ROLE OF FINANCIAL STATEMENT IN INVESTMENT DECISION MAKING. (A CASE STUDY OF FIRST BANK OF NIGERIAN PLC)

ABTRACT

Corporate organizations owe a duty to fully disclose matters concerning their operations so as to aid investors in making investment decisions because Investment decision makers rely on information obtained from financial statements to predict future rates of return. Without the financial statement, there will be a problem of how to determine the profit of a company, and evaluation of performance of a company. The general objective is to ascertain the role of financial statement in investment decision making. The study will be based on survey and questionnaire will be used to gather information. There is a total population of 70 personnel but the sample size is 60 using Taro Yamanes formula. The methods used in analysing this study are simple percentage and chisquare. We discovered from the test of hypotheses that financial statement is relied upon in investment decision making and financial statements are useful for forecasting companys performance. Concluded was drawn based on the findings that financial statement plays a vital role in investment decision making and recommends that no investment decision should be taken without the consideration of a companys financial statements

TABLE OF CONTENT

Cover pagei

Title pageii

Certification pageiii

Dedicationiv

Acknowledgementv

Abstractvi

Table of contentvii

CHAPTER ONE

1.0 Introduction1

1.1 Historical background2

1.2 Statement of the problem3

1.3 Objective of the study4

1.4 Research hypotheses5

1.5 Research questions6

1.6 Significance of the study7

1.7 Scope of the study8

1.8 Limitation of the study8

CHAPTER TWO: LITERATURE REVIEW

2.0 Introduction10

2.1 Features of financial statement12

2.2 Functions of financial statement12

2.3 Objectives of financial statement13

2.4 Analysis of financial statement14

2.5 Users of financial statement14

2.6 Attributes of an ideal financial statement18

2.7 Types of financial statement21

2.8 Definition and nature of investment decision29

2.9 Importance of investment decision32

2.10 Types of investment decision34

2.11 Investment evaluation criteria36

2.12 The role of financial statement in investment decision making42

2.13 Types of ratios and their uses43

Reference

CHAPTER THREE

RESEARCH METHODOLOGY

3.0 Introduction49

3.1 Research design49

3.2 Area of the study50

3.3 Population of the study50

3.4 Sample size and sample technique50

3.5 Instruments for data collection52

3.6 Sources of data collection52

3.7 Methods of data collection53

3.8 Method of data presentation and analysis54

3.9 Validity of instrument used56

3.10 Reliability of the instrument used56

Reference

CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS

4.1 Data presentation58

4.2 Data analysis58

4.3 Test of hypotheses67

CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS

5.1 Summary of findings72

5.2 Conclusion73

5.3 Recommendations74

Bibliography 76

Appendixes 78