ARTIFICIAL INTELLIGENCE AND QUALITY OF FINANCIAL REPORTING IN NIGERIA

ABSTRACT Despite the adoption of International Financial Reporting Standards (IFRS) in Nigeria in 2012, the quality of financial reporting remains suboptimal, characterized by delayed submissions, errors, incomplete disclosures, and weak institutional enforcement. These challenges undermine transparency, investor confidence, and access to capital. Globally, Artificial Intelligence (AI) is transforming financial reporting through enhanced accuracy, timeliness, and reliability, yet its adoption in Nigeria remains limited and fragmented. This study investigates the impact of AI adoption specifically AI strategy development, AI-driven decision making, and AI-powered process automation on financial reporting quality among listed firms on the Nigerian Exchange Group (NGX) from 2015 to 2024. Using an ex-post facto research design and robust regression analysis on panel data from 398 firm-year observations, the study finds that AI strategy development (coef. = -0.031, p = 0.615), AI-driven decision making (coef. = 0.041, p = 0.744), and AI-powered process automation (coef. = -0.063, p = 0.278) have statistically insignificant effects on financial reporting quality. These findings suggest that AI adoption in Nigeria is nascent, constrained by infrastructural deficiencies, low digital literacy, and lack of strategic integration. The study recommends that corporate managers and regulators prioritize comprehensive AI strategies, invest in decision-support systems, and expand automation to strategic reporting areas to enhance transparency and compliance. This research contributes to the Technology Acceptance Model (TAM) by highlighting the critical role of perceived usefulness and ease of integration in realizing AI’s potential in emerging economies.