STOCK ASSESSMENT METHOD AND FINANCIAL DATA IN SOME PRODUCTION COMPANIES​

The study examined the effect of stock assessment methods on financial data in selected production companies in Rivers State, Nigeria. The study was motivated by the increasing concern over the absence of a universally accepted stock assessment technique and the effect of different valuation methods on financial statements, taxation, and investment decisions. Specifically, the study sought to determine whether stock assessment methods influence assessable income tax, examine the effect of prevailing economic conditions on the choice of stock assessment methods, and evaluate the extent to which variations in stock assessment methods affect the financial data positions of production companies.A survey research design was adopted for the study. Data were collected from three selected production companies namely Emenite Limited, Innoson Technical and Industrial Company Limited, and AloAluminumproduction Company Limited. Both primary and secondary sources of data were utilized. The primary data were obtained through questionnaires and oral interviews, while secondary data were sourced from textbooks, journals, and other relevant materials. A sample size of 142 respondents was determined using the Taro Yamane formula, and the data collected were analyzed using simple percentages, regression coefficient analysis, and Z-test statistical techniques.The findings revealed that stock assessment methods significantly affect financial statements, tax assessment, cost of goods sold, and closing stock values. The study further discovered that the Last-In-First-Out (LIFO) method is more suitable during inflationary periods, while the weighted average method provides a balanced and realistic valuation approach. The study concluded that consistency and proper disclosure of stock assessment methods are essential for presenting a true and fair view of financial statements. Consequently, the study recommended the adoption of the weighted average method for production companies.