IIARD International Institute of Academic Research and Development

Journal of Accounting and Financial Management (JAFM )

E-ISSN 2504-8856
P-ISSN 2695-2211
VOL. 11 NO. 3 2025
DOI: 10.56201/jafm.vol.11.no3.2025.pg1.16

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Accounting Alchemy and Reported Market-Based Financial Performance: Evidence from Publicly Quoted Firms in Sub-Saharan Africa

Edesiri Godsday OKORO, PhD, Ebipanipre Gabriel MIESEIGHA, PhD

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Abstract

There is rareness of empirical studies on the relationship between accounting alchemy and reported market-based financial performance, particularly in sub-Saharan Africa. This paper employs a dissimilar accounting alchemy modeling evaluating Tobin’s Q (a measure for reported market-based financial performance). Thus, this study seeks to (1) apply certain components of accounting alchemy in advancing a dissimilar alchemy model; (2) ascertain the effect of accounting alchemy on reported market-based financial performance of firms in sub- Saharan Africa. Data were gathered from 112 publicly quoted firms of 3 stock exchanges in sub- Saharan namely Nigeria and Kenya, South Africa from 2012-2021. Wald statistics showed that reported market-based financial performance of firm is influenced by accounting alchemy. However, it was found that accounting alchemy is more practiced in Nigeria (mean score=0.64), followed by South Africa (mean score=0.51) and lastly, Kenya (mean score=0.47). Finding calls for stringent policy recommendations for management of firm, regulatory framework of accounting, government and accounting researchers alike.

keywords:

Accounting alchemy; Accounting methods and choices; Tobin’s Q; Earnings

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