Misstatement of accruals is a major hindrance on the credibility of financial statements prepared by companies across the globe. When accruals are not correct, the information conveyed by the financial statements end misleading those relaying on them for crucial decisions. The objective of this study was to investigate the effect of accuracy of accruals on the market value of formal manufacturing firms in Kenya. The relationship between accuracy of accruals and market value was moderated by firm size. Signaling effect theory was used in supporting this study. This study adopted the mixed research design. Stratified random sampling technique was used in sample size determination. The study used both primary and secondary data. The p-value of 0.000 which was less than 0.05 confirmed that accuracy of accruals has a significant positive effect on the market value of the formal manufacturing firms in Kenya. The p value of 0.484 which was greater than 0.05 on the moderated relationship model, confirmed that firm size has no significant moderating effect on the relationship between accuracy of accruals and market value. The researcher recommends that formal manufacturing firms should focus on strengthening their accuracy of accruals reporting strategies, because they significantly affect their market value.