Financial Accounting Ratios and Corporate Performance of Firms in Nigeria

This study examined financial accounting ratios and corporate performance of firms in Nigeria. The main purpose of the study is to examine the effect of financial accounting ratios and corporate performance of firms in Nigeria. After exhaustive literature review, secondary data was sourced from Dangote Nigeria plc. financial accounting ratios were proxied with current ratio, quick ratio, and debt/equity ratio while corporate performance was proxied with return on equity. The study employed ordinary least square (OLS) using SPSS statistical package. Findings reveals that current ratio have positive and insignificant relationship with return on equity, quick ratio have negative and insignificant relationship with return on equity and debt/equity ratio has positive but insignificant relationship with return on equity of firms in Nigeria. We conclude that financial accounting ratios have positive but insignificant relationship with corporate performance of firms in Nigeria. The study therefore recommends that since the current ratio had a positive but insignificant effect on ROE, firms should avoid relying solely on liquidity management as a performance driver.