Mountain Top University Library

ABSTRACT
The primary objective of this study is to investigate the effect of creative accounting on
shareholders’ wealth: Perception of selected auditors in Lagos State. The method employed for
the study was a cross-sectional survey research design, in which data were collected through a
well-structured questionnaire instrument. The population of the study comprised the Big4 audit
firms which were used as the sampling frame for the study with convenience (strata) sampling
technique. A total of 150 copies of administered questionnaire were returned and analyzed for this
study. The data underwent analysis using multiple regression analysis. The study reveals that
accelerated depreciation with sig. (.393), tax avoidance with sig. (.087), income smoothing with
sig. (.120) has no significant impact on shareholders’ wealth while inventory manipulation with
sig. (.000) has significant impact on shareholders’ wealth as the sig. is less than 0.05. In all, the
study concludes that inventory manipulation has significant effect on shareholders’ wealth. It was
therefore, recommended inventory manipulation has a positive linear significance on
shareholders’ wealth, so companies should undergo regular independent audits to ensure the
accuracy of their inventory valuation and minimize the risk of manipulation.