Competitor Accounting and Profitability of Listed Financial Institutions in Nigeria

Abstract

Companies strive to be profitable to maximize shareholder’s wealth. They can only do that by mastering their current trend in the business environment and having competitive strategies that will give them an edge over other companies. This study examined the relationship between competitor accounting and profitability of listed financial institutions in Nigeria. Specifically, the study investigated the relationship between competitor cost assessment, competitive position monitoring, competitor’s financial statement performance appraisal,  and  net profit margin  of listed financial institutions in Nigeria. The ex-post facto research design was used. The study population was fifty-three (53) out of which a sample size of forty (40) was obtained using judgmental sampling technique. Multiple regression was used to test the postulated null hypotheses with the aid of Stata12. The study revealed a positive and significant relationship between competitor cost assessment and net profit margin, a negative and significant relationship between competitive position monitoring and net profit margin, and a positive and insignificant relationship between competitor financial statement performance appraisal and net profit margin. The implication of these findings is that managers of listed financial institutions in Nigeria should continuously analyse the financial statement of competitors to gain competitive advantage and be profitable.