ABSTRACT

This study focuses on the effect of financial report on share market price of banks in Nigeria. An investor who is faced with a decision to either buy or sell a particular stock, there is need to resort to financial analysis of the company 's business over a period, to determine whether profits are rising or falling and the implication of future performance. However, due to the problems of acquiring adequate information, available finance may be directed into wrong firms or organizations. The study made used of an ex-post facto research design. The data collected were then tabulated and analyzed using the simple regression analysis. The result revealed that the estimated coefficient of the regression parameter have a positive sign and thus conform to our a-priori expectation. The implication of this sign is that the dependent variable Share Market Price (SMP) is positively affected by Earning Per Share (EPS), Dividend Per Share (DPS) and Profit After Tax (PAT). The study also revealed that there is a very high relationship between Earning Per Share (EPS), Dividend Per Share (DPS,), Profit After Tax (PAT) and Share Market Price (SMP). Conclusively, As every financial report is published to provide accounting information to external users, it does not guarantee a success in their investment. However, adequate understanding of financial report and the application of this accounting report would result to favourable investment. It can therefore be concluded that financial report has a great impact on the investment decisions of investors based on their reliance, understanding and application of this information. It is recommended that investors should be interested in understanding the components of the annual reports as a better understanding would lead to better and more profitable investment. Investors should not only rely on the annual report but should also strengthen their knowledge and understanding of their investment through newspapers, magazines, stock exchange market and even from advice of stock brokers.