Assessment of Financial Reporting Quality in a Developing Country Using Nice Qualitative Characteristics Measurement


  • Martin Kabwe University of Zambia, Great East Road Campus, Lusaka, Zambia



Quality of Financial Information, FRQ Direct Measurement Tool, Developing Country


Purpose: The use of different indirect measurement methods by prior empirical studies has led to contradictory findings about financial reporting quality. Therefore, this study assessed the extent of financial reporting quality using the direct method.

Methodology: Data was collected through quantitative content analysis of annual reports and audited financial statements of 20 Zambian listed companies for the period 2012 to 2018 using a direct measurement tool developed by the Nijmegen Center for Economics (NiCE). Descriptive statistics were used to assess the extent of financial reporting quality.

Findings: The study showed that the mean and median score for financial reporting quality is 2.62(52.3%) and 2.55(51%) respectively with a minimum of 2.06(41.2%) and maximum of 3.21(64.2%). The level of financial reporting quality was moderately low. Further, relevance and comparability of financial reports were poor, and companies used only or mostly historical cost instead of fair value as basis for measurement as proposed by the IFRS for its FRQ standard. Therefore, the financial reporting quality of listed companies do not meet all the criterion set out in the IFRS conceptual framework.


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How to Cite

Kabwe, M. (2023). Assessment of Financial Reporting Quality in a Developing Country Using Nice Qualitative Characteristics Measurement. International Journal of Finance and Accounting, 8(1), 1–22.