MODERATING EFFECT OF LEVERAGE ON THE VALUE RELEVANCE OF ACCOUNTING INFORMATION IN THE NIGERIAN LISTED OIL AND GAS FIRMS

The study investigates the moderating effect of leverage on the value relevance of accountinginformation in the Nigerian listed oil and gas firms. The study used correlational research designand the data was extracted from the published annual financial reports of the firms for theindependent variables and the moderator. On the other hand, the data for the dependent variable(share prices) was collected from Nigerian stock exchange website. A sample size of 6 firms wereused for a period of eight years (2011-2018). The data was analysed using multiple regressionanalysis. Findings from the analysis showed that earnings per share, and leverage to be valuerelevant. Additionally, book value per share moderated with leverage was value relevant in additionto earnings per share moderated with leverage as well. Based on the findings, the study recommendsthat listed oil and gas firms in Nigeria should strategize to improve their earnings, Moreover, theyshould also find way of managing their book value, as any unnecessary investment means negativeeffect on share price. Additionally, listed oil and gas firms should maintain an appropriate level ofleverage so that the cheap cost of leverage will reduce the weighted average cost of capital andsubsequently increase value to investors. Finally, the explanatory power of the moderated variablesare more than the ones not moderated.