Vol. 3, Issue 2 (2016)
Determinants of the preference of accounting method of oil and gas companies in Nigeria
Author(s): C. O Mgbame, I. O Ukpebor
Abstract: The focus of this study was to examine the determinants of the preference of accounting method of oil and gas companies in Nigeria. Specifically, the study examines the significance of Securities underwriting, Debt covenants, Political cost and Managerial compensation in the preference of accounting methods. the Using the survey research design and the spearman ranked correlation analysis, the study finds that putting these factors in perspective; Securities underwriting, Debt covenants, Political cost and except for Managerial compensation, the Full cost method appears to have a stronger correlation than the successful cost method. This may imply that in the determination of the choice of accounting methods to be used by oil and gas companies, these factors may present full cost method as more preferable. However, caution is suggested in drawing too much inferences from the results as other more sophisticated techniques like discriminant analysis and logistic regression may be needed to substantiate these findings.