




































American International Journal of Agricultural Studies  

Vol. 2, No. 1; 2019 

ISSN 2641-4155   E-ISSN 2641-418X 

Published by American Center of Science and Education, USA 

 

9 

 

An Assessment of Compliance with Disclosure Requirements of IAS 

41 (Agriculture) By Listed Agricultural Firms in Nigeria 

 
 

Nura Ibrahim  

Busary Department 

Umaru Musa Yar’adua University Katsina-Nigeria 

 

Shafi’u Abubakar Kurfi
 

Department of Accounting 

Umaru Musa Yar’adua University Katsina-Nigeria  

E-mail: abubakarkurfishafiu@gmail.com  

Tel: +2348034810371 

 

 

 

Abstract 

This study examined the extent of compliance with disclosure requirements of IAS 41 by agricultural companies 

listed on the Nigerian Stock Exchange (NSE) for the period of 5 years (2013-2017). The data for the study were 

obtained from the published financial statements of the sampled firms for the period under review from which a 

compliance index were constructed, The tools for analysis used were the qualitative grading using a compliance 

index and the one way ANOVA purposely to test the hypotheses proposed. The study observed that three out of the 

four Companies achieved more than 70% with overall mean scores of 76.02%. This shows that majority of the 

agricultural firms in Nigeria strongly complied with the disclosure requirements of IAS 41. Based on the findings 

the study recommends among others that firms should strive at all times to comply with all regulatory and statutory 

requirement in the preparation and presentation of financial statements, giving the fact that it is a set of documents 

that prescribe the performance of the reporting entity. The Financial Reporting Council of Nigeria should publish 
annually the compliance status of all listed firms in Nigeria; so that the compliance status of every firm will become 

known to all interested users of financial statements; and also the Council should urge external  auditors of firms to 

ensure that their clients are complying with the requirements of IASs issued by the International Accounting 

Standards Board (IASB). 

 

Keywords: Agricultural firms, Compliance, Disclosure, Nigeria 

 

1. Introduction 

Agriculture is a major source of livelihood throughout the world, In Nigeria in has over the years been largely a 

private indigenous activity in spite of the recent intensification of interest by government in the sector and its official 

effort to infuse foreign private participation. Agriculture covers diverse range of activities; these include raising 
livestock, forestry, annual or perennial cropping, cultivating orchards and plantations, floriculture, aquaculture (plus 

fish farming). Agricultural activities cannot be detached from the operational processes that comprise the 

purchasing, transformation, harvesting and the associated sale of produce or offspring (Biljon, 2016). These 

operational processes are recorded and valued to allow agriculturalists to control budgets, increase production, and 

meet financial obligations and drive profits (Bayboltaeva, Makulova, Abaeva, Alibekova & Bolysbayeva. 2015). To 

allow agriculturalists and other users a comparative review and analysis of the financial results, a uniform criterion 

on how to record and report on the operational activities should exist (Baigrie, 2014). 

Accounting standards were developed to detail the requirements of how and when transactions should be 

recorded (Vukmirovic, Arsenovic, Lalic & Milovanovic, 2012). The recording of these transactions and the 

reporting thereon is regarded as financial accounting. Deegan and Unerman (2011) define financial accounting as a 

‘process involving the collection and processing of financial information to assist in the making various decisions by 

many parties internal and external to the organisation’. Their definition refers to the investors, suppliers, lenders, 
employees, government, customers and the community as parties interested in the business operations. Consistency 

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http://en.wikipedia.org/wiki/International_Accounting_Standards_Board
http://en.wikipedia.org/wiki/International_Accounting_Standards_Board


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in the financial reporting processes of organisations, supported by a uniform valuation and disclosure technique will 

ensure that financial information can be compared with that of other organisations (Gonçalves & Lopes, 2015). The 

harmonization of financial reporting therefore enhances comparability of financial information as the degree of 

variation of information is restricted (Deegan & Unerman, 2011).  

A number of accounting standards have been developed as the required criterion to record agricultural 

activities and to provide fairly presented results to the financial statement users. The International Accounting 
Standard (IAS) 41 prescribe the accounting treatment to record the initial purchase of the biological assets, to 

account for the biological transformation, to value and report on the biological assets and to derecognise the assets at 

the point of harvest when the inventory is recognised (IASB, 2013). It was issued in 2001 and is applicable to 

entities engaged in agricultural activities for periods beginning on or after 1st January, 2003 

The objective of this study is to determine whether listed agricultural firms in Nigeria have complied with disclosure 

requirement of IAS 41 in financial reporting framework; and to determine the level of the compliance. In the light of 

the above; the following hypotheses were tested: 

 

H01: Agricultural firms in Nigeria have not complied with the disclosure requirement of IAS 41 in financial 

reporting framework. 

H02: There is no significant difference in the level of compliance with the requirements of IAS 41 among listed 

agricultural firms. 
 

2. Literature Review  

Accounting Standard is defined by Yahaya (2011) as an information system through which financial and monetized 

information is generated for economic, social and political decisions. They are documents developed by standard 

setting bodies locally and internationally to ensure a high degree of standardization, uniformity and comparability in 

published financial statements. They have proved to be effective in providing necessary guides on how accounting 

information should be prepared and presented in order to enhance the value of its contents and facilitate its thorough 

understanding. The quality of financial information according to Kothari (2000) is a function of both the quality of 

accounting standards and the regulatory enforcement or corporate application of the standards. Absence of adequate 

enforcement, therefore, renders the best accounting standards useless, ineffective and inconsequential. In Nigeria, 

Until 2003 when the Nigerian Accounting Standards Board (NASB) Act was enacted, now Financial Reporting 
Council of Nigeria Act, 2011 makes it mandatory for accountants preparing corporate reports to adhere strictly to 

the provisions of all issued accounting standards, It is imperative therefore that in applying accounting standards it is 

important to be guided by the spirit and reasoning behind their issuance. However, if in exceptional circumstances 

compliance with the requirements of an accounting standard is inconsistent with the requirement to give a true and 

fair view, the requirements of the accounting standard departure from the standard could be permissible to the extent 

necessary to give a true and fair view. In such cases informed and unbiased judgment should be used to devise an 

appropriate alternative treatment, which should be consistent with the economic and commercial characteristics of 

the circumstances concerned (Siyanbola, Musa, & Wula, 2014). 

IAS 41 prescribes the accounting treatment, financial statement presentation, and disclosures related to 

agricultural activity. Agricultural activity is the management of the biological transformation of biological assets 

(living animals or plants) and harvest of biological assets for sale or for conversion into agricultural produce or into 

additional biological assets. IAS 41 establishes the accounting treatment for biological assets during their growth, 
degeneration, production and procreation, and for the initial measurement of agricultural produce at the point of 

harvest. It does not deal with processing of agricultural produce after harvest (for example, processing grapes into 

wine, or wool into yarn). It does not also apply to land related to agricultural activity (IAS 16 Property, Plant and 

Equipment and IAS 40 Investment Property); and intangible assets related to agricultural activity (IAS 38 Intangible 

Assets). Examples of biological assets are sheep, Tress in plantation forest, plants, Dairy cattle, bushes, fruit trees, 

etc. Examples of agricultural produce are wool, felled trees, cotton, harvested cane, milk, leaf, grapes, picked fruits 

etc. (IASB, 2013). 

2.1 Theoretical Framework 

Accounting theory encompasses assumptions, methodologies and frameworks used in the study of financial 

principles. This involves a review of the historical foundations of accounting practices, as well as the way in which 

accounting practices are verified and added to the regulatory framework that governs financial statements and 
financial reporting. This paper dwells on two theories; Agency theory and the stakeholder theory.  

 

 



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2.1.1The Agency Theory  

The agency theory states that when one party (the principal) delegates decision-making powers to another party (the 

agent) under a contract, a principal–agent relationship arises (Clarke, 2004). The principal-agent relationship is a 

contract under which one or more persons (principals) engage another person (the agent) to perform some services 

on their behalf, which involves giving some decision-making authority to the agent. From the business perspective, 

the agency relationship arises when shareholders (who are the owners of resources) delegate the administration of an 
entity to management (who administers the enterprise), thus making management the agent of the shareholders. In 

this kind of relationship, the expectation is that the agent (management) will pursue the shareholders’ wealth 

maximisation objective (Fama & Jensen, 1983) 

The agency theory is relevant to this study because the sampled companies are those listed on the Nigerian 

Stock Exchange. The managements of these companies are separated from the owners (shareholders) and are 

required by the respective legal and regulatory authorities to render the account of stewardship to the shareholders at 

the annual general meetings. In fulfilling this obligation, managements employ the accounting standards and other 

relevant provisions to disclose information to the shareholders. 

 

2.1.2 The Stakeholders Theory 

This theory was developed to address the shortcomings of the Agency theory. The agency theory was criticized for 

prioritizing the interest of the shareholders above the general interest of other stakeholders such as government, 
employees, and the society at large. This theory argued that firm is a social person and therefore is responsible and 

accountable not only to the shareholders but to numerous other stakeholders. In the light of this, firms should 

disclose more information in their financial statement to satisfy the interest of various stakeholders (Arthur & 

Busenitz, 2004) 

 

2.2 Review of Empirical Study 

Several studies have been conducted to determine compliance with disclosure requirements of accounting standards 

within and outside Nigeria. Hodgdon, Tondkar, Adhikari & Harless (2009) investigate the extent of disclosure 

compliance by companies from developed countries with non US listings that claim to have complied with IASs in 

1999 and 2000. The study reveals that the level of compliance from a sample of 101 companies selected from 13 

countries (Austria, China, Czech Republic, Denmark, Finland, Germany, Hong Kong, Hungary, Italy, Netherlands, 
South Africa, Sweden and Switzerland) is 58% and 64% in 1999 and 2000 respectively. Ballas and Tzovas (2010) 

further affirmed significant non-compliance by examining the extent to which Greek firms comply with the 

disclosure requirements of IFRS. Financial statements of 32 Greek firms were examined for compliance. The 

compliance ratio was computed as what a company disclosed in its report to what it is obliged to disclose for each 

category. The study revealed that no single firm fully complied with disclosure requirements while the average 

compliance rate was 62.9%. The study also revealed that, level of compliance was positively related with company 

attributes such as listing status, size, and profitability while a negative relationship was established for sector 

classification. 

Al-Mutawaa and Hawaidy (2010) empirically investigate the extent of compliance of Kuwaiti listed 

companies with IAS/IFRSs disclosure requirements and examined the factors associated with the level of 

compliance. 2006 annual report of 48 non-financial companies were randomly sampled from 121 Kuwaiti 

companies listed and carefully scrutinized for compliance with IASs disclosure compliance. Standards examined 
were IAS 1, 10, 14, 16, 18, 21, 23, 24, 27, 28, 32 and 34. The study revealed an overall average compliance rate of 

70%.  IAS 18 was reported as the standard with the highest mean compliance score of 95%.  

Al-Shammari (2011) evaluated the extent of compliance with disclosure requirements of international 

financial reporting standards (IFRSs) by 168 companies listed on the Kuwaiti Stock Exchange in 2008 using a self-

disclosure compliance index and multivariate regression analysis to test the relationship between the level of 

disclosure compliance with IFRSs and nine company characteristics. The results showed that the level of 

compliance by sampled firms is 82%. The findings suffer limitations because the model was able to explain only 

40% of the compliance variation coupled with the fact that it is based on assumption that compliance items have the 

same weight and that companies that are disclosing the most information would have selected the most important 

information. Al-Jabri & Hussain (2012) assessed the level of disclosure in the annual reports of 94 manufacturing 

and service firms listed on Muscat Securities Market (MSM) in Oman. A disclosure checklist consisting of 66 
mandatory items was developed to assess the level of disclosure in the 2003 annual reports of the sampled firms to 

investigate the level of compliance with eight standards namely IAS 1, IAS 2; IAS 10; IAS 16; IAS 21; IAS 24; IAS 

28 and IAS 33. The study reveals that the mean level of compliance by all the sampled firms was 79% while the 



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minimum compliance level observed was 41%. Disclosure with IAS 16 shows that it enjoys mean level of 

compliance of 83%, while item by item analysis reveals a maximum and minimum level of compliance of 100% and 

23% respectively. Equally significant from the study is the existence of considerable variation between individual 

companies in terms of the level of compliance with international accounting standards.  

Research on compliance with accounting standards disclosure practice in Nigeria include: Barde (2009) appraised 

the extent of compliance with disclosure requirements of SAS 2 (information to be disclosed in financial statements) 
by Nigerian Oil Marketing Companies. Through the compliance index and chi square technique the study affirms 

that compliance by sampled firm was 50% for disclosure relating to balance sheet and its content, 100% for all other 

disclosure requirements of the standard. In a similar study, Nyor (2010) who examines compliance with SAS 2 

(information to be disclosed in financial statements), SAS 10 (accounting by banks and nonbank financial 

institutions) and SAS 18 (on statement of cash flows) by Nigerian banks for a sample of 6 out of 24 banks listed on 

the Nigerian Stock Exchange (NSE) between 1999 and 2008. The result exposes existence of several areas of 

noncompliance in each standard.  

Yahaya (2011) assesses the level of Nigerian banks’ compliance with 16 statements of accounting 

standards. Twenty selected banks quoted on the Nigerian Stock Exchange constituted the target sample. Both 

primary and secondary sources of data were adopted in carrying out the study with a researcher-designed 

questionnaire used to obtain data from sampled banks. A total of five hundred randomly selected senior and 

management staff of banks were chosen as respondents for the study. The annual financial reports of the selected 
banks from 2005-2009 were also used. The result of ANOVA reveals that there is significant difference between the 

banks in their level of compliance with Statement of Accounting Standards.  

Sa’idu and Umar (2014) study the level of compliance with IFRSs as a reporting framework in the Nigerian Banking 

Industry. Using ex-post facto and survey research designs, the study sourced data from structured questionnaire and 

recent audited financial reports of the sampled banks. Qualitative Grading System (QGS) was employed in 

determining the degree of compliance of the banks while Multivariate regression and Chi-squire test were used in 

measuring the effect of the factors responsible of such compliance and identified probable difficulties in the process 

respectively. The study concludes that, Nigerian banking industry complied (semi-strongly) with the requirements of 

IFRS-framework 

Siyambola, Zaharadden & Adegboye (2014) examined the extent of disclosure compliance with SAS 3 and 

IAS 16 by companies listed on the Nigerian Stock Exchange (NSE) for the years (2002-2011). The data for the 
study were obtained from the published financial statements of the sampled listed agricultural firms from which two 

sets of compliance indexes were constructed, one for the Statement of Accounting Standard (SAS) and the other for 

the International Accounting Standard (IAS). The tools of analysis used were the compliance index and the 2 way 

ANOVA purposely to test the hypotheses proposed. The study observed that at present Nigerian companies are far 

from achieving the disclosure requirements of IFRS going by poor level of compliance with the International 

Accounting Standard (IAS) 16 of 34.72% 

However, studies relating to the implementation of the IAS 41 include Elad and Herbohn (2011) who 

conducted a survey concerning biological assets in three countries, Australia, the United Kingdom and France. They 

have concluded that, as main lessons, the costs of measuring and reporting biological assets at fair value outweigh 

the benefits and that the fair value accounting model prescribed by the IAS 41 increases the volatility of earnings. 

Also Silva, Figueira, Pereira, and Ribeiro (2012) have developed a disclosure index concerning the information 

related to the agricultural sector of 45 Brazilian firms regarding the 2010 annual report. The disclosure of the types 
of biological assets and the reconciliation of the carrying value of their changes are the most frequently reported 

items, but other items are neglected, such as management risks and other restrictions of biological assets. They have 

concluded that a higher transparency level in disclosure helps to mitigate information asymmetry.  

From the review of empirical study above, few studies were conducted on the compliance with requirements of IAS 

41 (Agriculture) and are not related to Nigerian firm. It is a result of this therefore that, this study attempt to fill this 

existing gap in determining whether listed agricultural firms in Nigeria have complied with disclosure requirement 

of IAS 41 in their financial reporting framework; and to determine the level of the compliance. 

 

3. Methodology 

This study investigates the level of compliance of quoted companies on the Nigerian stock exchange (NSE) under 

Agricultural sector with the provisions of IAS 41. The study employs secondary data which are sourced from the 
published financial statements of the firms listed in the sector. The population of study comprises of five listed 

companies as contained in the NSE website as at September, 2018. They are Ellah Lakes Plc., FTN cocoa 

processing Plc., Okomu Oil Palm Plc., Presco Plc. and Livestock Feeds Plc. Of the five listed above, four of them 



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namely: Ellah Lakes Plc., Okomu Oil Palm Plc., Presco Plc. and Livestock Feeds Plc. were selected. The basic 

criteria for sample selection are that the sample firms must meet the application criteria provided by IAS 41. 

Qualitative grading using a compliance index and ANOVA Statistics similar to Siyanbola et al., (2014) were used in 

the data analysis.  

 

4. Data Analysis and Discussion 
In this study, Qualitative grading using a compliance index and ANOVA Statistics were used in the data analysis. A 

total of 21 requirements were developed from the international accounting standard based on a critical review of 

relevant literatures and concept of IAS 41. Each of the requirement was assigned a number “R” from requirement 1 

(R1) to the last requirement (R21), this study adopted a scoring system of assigning numbers between 1 – 10 

depending on the extend of compliance. The criteria used for assessing the overall level of compliance with the 

requirements of IAS 41 in financial reporting by agricultural firms are set out in Table 1 below. The criterion set out 

above provides the decision rule to which the computed compliance index will be lead to acceptance or rejection of 

the hypothesis of the study.  

Table 1 

Criteria for grading compliance with requirement of IAS 41 by Listed Agricultural Firms in Nigeria 

S/No. Percentage Point Form 

1 70% - 100% 7 - 10.0 Strongly Applied (SA) 

2 50% - 69% 5 - 6.9 Semi Strongly Applied (SSA) 

3 40% - 49% 4 - 4.9 Weakly Applied (WA) 

4 20% - 39% 2 - 3.9 Very Weakly Applied (VWA) 

5 0% - 19% 0 - 1.9 Non Application (NA) 

Source: Adopted with modification from Siyanbola et al., (2014) 

 

The disclosure requirements of IAS 41 are clearly arranged in Table 2 as it relates to issues that must be 

addressed in the preparation of financial statements by reporting entities globally. This is to facilitate ease of 

comparison with the financial statements, awarding scores appropriately and ultimately provide data for analysis 

using the ANOVA method. The approach adopted for data presentation and analysis is in tandem with Siyanbola et 

al., (2014). The sample companies are Ellah Lakes Plc., Okomu Oil Palm Plc., Presco Plc. and Livestock Feeds Plc. 
are represented as company 1, company 2, company 3 and company 4 respectively. 

 

Table 2:  Disclosure Requirement of IAS 41 

Variable 

Representin

g Disclosure Requirement 

R1.  Disclosure of the aggregate gain or loss for the period on initial recognition of biological assets   

R2.  Disclosure of the aggregate gain or loss for the period on initial recognition of agricultural produce  

R3.  
Disclosure of the aggregate gain or loss for the period on change in fair value less estimated point-
of-sale costs of biological assets 

R4. Disclosure of the Description and the nature of activities involving each group of biological assets 

R5. 
Disclosure of non-financial measures or estimates of the physical quantities of agricultural produce 

output for the period and biological assets as at the year-end date 

R6. Disclosure of the Methods and significant assumptions in determining fair value 

R7. Disclosure of the fair value less costs to sell of agricultural produce harvested for the period 

R8. Disclosure on the Restrictions on title, pledges and commitments in respect of biological assets 

R9. Disclosure of the Financial risk management strategies related to agricultural activity 

R10. 
Disclosure of the reconciliation of changes in the carrying amount of those biological assets 

between the beginning and the end of the current period. 



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R11. Disclosure of the nature and extent of government grants recognised in the financial statements 

R12. Disclosure of the Unfulfilled conditions and other contingencies attaching to government grants 

R13. Disclosure of the Significant decreases expected in the level of government grants. 

R14. Disclosure of the Description of those biological assets 

R15. Disclosure of the Explanation of why fair value cannot be measured reliably 

R16. Disclosure of the range of estimates within which fair value is highly likely to lie (if possible) 

R17. Disclosure of the  gain or loss recognised on disposal of those biological assets impairment  

R18. Disclosure of the Losses (if any), reversals of impairment losses (if any) and depreciation expense 

R19. Disclosure of the depreciation method used 

R20. Disclosure of the useful lives or the depreciation rates used 

R21. 
Disclosure of the gross carrying amount and the accumulated depreciation (aggregated with 

accumulated impairment losses) at the beginning and end of the period. 

Source: Researcher’s Field Work, 2018 from IASB 2013 

 

A critical look at Table 3 below shows that the compliance of the firms with IAS 41 is remarkable. The 

companies, company 1, company 2 company 3 and company 4 achieved 76.54%, 86.62%, 87.19% and 53.71% 

respectively. It is apparent from the summary of the scores that the total compliance with the disclosure 

requirements of IAS 41 is significant at 76.02% mean scores. Using the grading scale it can be inferred that the 

Nigerian agricultural firms comply with the provisions of the standard. On examining the requirement by 

requirement basis all the firms attained a higher compliance on requirements 1, 3, 4, 10, 11, 12, 13, 14, 17, 19, 20 & 

21 at above 70%. None of the firms comply with the provision of requirement 8, 15, & 16 and only one of them 

complied with requirement 5 of the standard. Year by year analysis revealed that the compliance rate for all the 

years were above 70%.  
 

Table 3:  Summary of Compliance Index with IAS 41 by Listed Agricultural Firms in Nigeria 

Company Year 

Total 

Observed 

Total 

Expected 

Compliance 

Index Remark 

Ellah Lakes Plc.  2013 143.5 210 68.33% SSA 

Ellah Lakes Plc.  2014 146.5 210 69.76% SSA 

Ellah Lakes Plc.  2015 158.5 210 75.48% SA 

Ellah Lakes Plc.  2016 177.6 210 84.57% SA 

Ellah Lakes Plc.  2017 177.6 210 84.57% SA 

Sub-Total 803.7 1050 76.54% SA 

Okomu Oil Palm Company Plc. 2013 176.7 210 84.14% SA 

Okomu Oil Palm Company Plc. 2014 181.7 210 86.52% SA 

Okomu Oil Palm Company Plc. 2015 183.7 210 87.48% SA 

Okomu Oil Palm Company Plc. 2016 183.7 210 87.48% SA 

Okomu Oil Palm Company Plc. 2017 183.7 210 87.48% SA 

Sub-Total 909.5 1050 86.62% SA 

Presco Plc.  2013 175.7 210 83.67% SA 

Presco Plc.  2014 183.7 210 87.48% SA 

Presco Plc.  2015 184.7 210 87.95% SA 

Presco Plc. 2016 185.7 210 88.43% SA 

Presco Plc.  2017 185.7 210 88.43% SA 

Sub-Total 915.5 1050 87.19% SA 



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Livestock Feeds Plc. 2013 112.8 210 53.71% SSA 

Livestock Feeds Plc. 2014 112.8 210 53.71% SSA 

Livestock Feeds Plc. 2015 112.8 210 53.71% SSA 

Livestock Feeds Plc. 2016 112.8 210 53.71% SSA 

Livestock Feeds Plc. 2017 112.8 210 53.71% SSA 

Sub-Total 564 1050 53.71% SSA 

Total 3192.7 4200 76.02% SA 

Source: Researcher’s Field Work, 2018 

 

4.1 Discussion of the result of Hypotheses Tested  

Table 4: Agricultural Firms Compliance with Disclosure Requirements of IAS 41 in Nigeria 

Compliance Index N Mean Df F Sign. 

Ellah Lakes Plc. 5 76.542  

16 

 

73.162 

 

0.000** Okomu Oil Palm Company Plc. 5 86.620 

Presco Plc. 5 87.192 

Livestock Feeds Plc. 5 53.710 

Source: Researcher’s Field Work, 2018 (SPSS Output). Note: (**) indicates significant at 5%. 

 
Table 4 above presents summary of ANOVA result on agricultural firms’ compliance with disclosure 

requirements of IAS 41 in Nigeria. The F statistics of 73.162 is significant at 5% level of significant. In testing the 

hypothesis one (H01), the null hypothesis which states that “agricultural firms in Nigeria have not complied with the 

disclosure requirements of IAS 41 in financial reporting” is rejected since the P – value 0.000 is less than 0.05 level 

of significant. This shows that agricultural firms in Nigeria have complied with the disclosure requirements of IAS 

41 in financial reporting. 

 

Table 5: The Level of Compliance with Requirements of Disclosure of IAS 41 among Agricultural Firms in Nigeria 

Compliance Index N Mean Df F Sign. 

Strongly Complied 13 85.668 18 128.726 0.000** 

Semi Strongly Complied 7 58.091 

Source: Researcher’s Field Work, 2018 (SPSS Output).  Note: (**) indicates significant at 5%. 

 

Table 5 above presents summary of ANOVA result on the level of compliance with disclosure 

requirements of IAS 41 among agricultural firms in Nigeria. The F statistics of 128.726 is significant at 5% level of 
significant. In testing the hypothesis two (H02), the null hypothesis which states that “there is no significant 

difference in the level of compliance with requirements of disclosure of IAS 41 among agricultural firms in Nigeria” 

is rejected since the P – value 0.000 is less than 0.05 level of significant. This shows that majority of the agricultural 

firms in Nigeria strongly complied with the disclosure requirements of IAS 41. 

 

5. Conclusion and Recommendation 

The aim of every research work is to arrive at credible findings that will provide correct answers to the research 

hypothesis. Using a constructed disclosure compliance checklist, the extent of compliance with disclosure 

requirement of IAS 41 by 4 listed companies under the agricultural sector of the Nigerian Stock Exchange at the end 

of 2017 were measured. Data was collected manually from annual reports of companies. Company 1, 2, 3, & 4 

achieved 76.54%, 86.62%, 87.19% and 53.71% respectively. It is apparent from the summary of the mean scores 

that the total compliance with the disclosure requirements of IAS 41 is significant at 76.02%. 
The results suggest that enforcement mechanisms to ensure total compliance should be put in place to 

address the existing compliance gap particularly on the requirement 5, 8, 15, & 16 of the standard. To this end, the 

study recommends that our firms should strive at all times to comply with all regulatory and statutory framework in 

the preparation and presentation of financial statements, giving the fact that it is a set of documents that prescribe the 

performance of the reporting entity. The Financial Reporting Council of Nigeria should publish annually the 

compliance status of all listed firms in Nigeria; so that the compliance status of every firm will become known to all 

interested users of financial statements; and also the Council should urge external  auditors of firms to ensure that 



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their clients are complying with the requirements of IASs issued by the International Accounting Standards Board 

(IASB) 

 

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Appendix 

 

One-way ANOVA 

Notes 

Output Created 16-OCT-2018 04:41:16 

Comments  

Input Data C:\Users\user\Documents\Compliance Index.sav 

Active Dataset DataSet2 

Filter <none> 

Weight <none> 

Split File <none> 

N of Rows in Working Data 

File 

20 

Missing Value Handling Definition of Missing User-defined missing values are treated as missing. 

Cases Used Statistics for each analysis are based on cases with 

no missing data for any variable in the analysis. 

Syntax ONEWAY CPI BY CMP 

  /STATISTICS DESCRIPTIVES 

  /MISSING ANALYSIS. 

Resources Processor Time 00:00:00.02 

Elapsed Time 00:00:00.03 

Descriptive 

Compliance Index   

 N Mean Std. Deviation Std. Error 95% 

Confidence 

Interval for 

Mean 

Lower Bound 

Ellah Lakes PLC 5 76.5420 7.80157 3.48897 66.8551 

Okomu Oil Palm Company 

PLC 

5 86.6200 1.44734 .64727 84.8229 

Presco PLC 5 87.1920 2.00794 .89798 84.6988 

Livestock Feeds PLC 5 53.7100 .00000 .00000 53.7100 

Total 20 76.0160 14.40737 3.22159 69.2731 

 
 

 

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18 

 

Descriptives 

Compliance Index   

 95% Confidence Interval 

for Mean 

Minimum Maximum 

Upper Bound 

Ellah Lakes PLC 86.2289 68.33 84.57 

Okomu Oil Palm Company PLC 88.4171 84.14 87.48 

Presco PLC 89.6852 83.67 88.43 

Livestock Feeds PLC 53.7100 53.71 53.71 

Total 82.7589 53.71 88.43 

 

ANOVA 

Compliance Index   

 Sum of Squares df Mean Square F Sig. 

Between Groups 3675.911 3 1225.304 73.162 .000 

Within Groups 267.964 16 16.748   

Total 3943.875 19    

Descriptives 

Compliance Index   

 N Mean Std. Deviation Std. Error 95% Confidence Interval for 

Mean 

Minimum 

Lower Bound Upper Bound 

SA 13 85.6677 3.49830 .97025 83.5537 87.7817 75.48 

SSA 7 58.0914 7.49409 2.83250 51.1605 65.0223 53.71 

Total 20 76.0160 14.40737 3.22159 69.2731 82.7589 53.71 

 

 

 
 

 

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Copyright for this article is retained by the author(s), with first publication rights granted to the journal. This is an 

open-access article distributed under the terms and conditions of the Creative Commons Attribution license 

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