Leverage

Firms Attributes and Sustainability Disclosures a Study of Less Sensitive Environmental Sector in Nigeria (Published)

This research delves into how firm attributes influence sustainability disclosure, focusing on a comparative analysis within the less environmentally sensitive sector in Nigeria. The specific aims include determining the variance in the impact of Leverage on sustainability disclosure and exploring the distinction in the effect of profitability on sustainability disclosure within this sector. Employing a longitudinal and ex-post facto research design, the study targets a population of 150 listed firms in Nigeria, selecting a sample of 20 firms from both financial and non-financial sectors through judgmental sampling. Data spanning from 2012 to 2021 were gathered from the annual reports and accounts of the chosen firms, along with information from the Nigeria Exchange Group (NGX) fact book. Hypotheses were tested using panel regression and t-test techniques. The primary findings reveal a significant difference in the influence of firm size on sustainability disclosure in more environmentally sensitive industries (P= 0.0002). In summary, the adoption of sustainable development strategies by companies reflects management’s acknowledgment of stakeholder perceptions. The study suggests that regulators prioritize environmental and social concerns to encourage sustainable practices, including enhanced disclosure on environmental, social, and governance fronts.

Keywords: Leverage, Sustainability Disclosures, firms’ size, less sensitive environmental profitability

Corporate Financial Attributes and Waste Disposal Cost Disclosure of Listed Industrial Goods Companies in Nigeria (Published)

This study examines the impact of corporate financial attributes on waste disposal cost disclosure (WDCD) of listed industrial goods companies in Nigeria from 2013-2020. A sample of ten (10) companies listed as industrial goods using census sampling technique was drawn from the population of thirteen (13) companies. Audited annual reports and accounts were used for data extraction. The analysis was done using descriptive statistics and multiple regressions. Explanatory research design was adopted in the study to find out the impact of corporate financial attributes on WDCD. Variables used include firm size, leverage, ROA and sales growth and WDCD measured using ordinal coding scheme based on GRI guidelines (G4). Robustness tests such as multicollinearity test, heteroscedasticity test, normality test and Hausman specification test were conducted to validate the results. The study revealed that there is negative significant relationship between FSIZE, LEV, SGWRT and WDCD while negative insignificant relationship between ROA and WDCD of listed industrial goods companies. The study therefore, recommends that the federal government of Nigeria should make WDCD mandatory especially among industrial good companies considering the nature of their activities polluting the environment. This can be done by making environmental reporting as part of the requirements for listing companies on the floor of Nigerian stock exchange.

Keywords: Leverage, ROA, WDCD, firm size, sales growth

Responsiveness of Biological Assets to Board size, Firm size, and Firms’ age of Agricultural Firms in Nigeria (Published)

This study examined the responsiveness of biological assets to board size, firm size and firm age of quoted Agricultural firms in Nigeria. The specific objectives were to examine the effect of board size, firm size, and firm age on the biological assets of quoted Agricultural firms in Nigeria. An ex-post facto research design was used which made use of secondary panel data drawn from annual reports and accounts of the sampled firms for a period of ten (10) years, 2011-2020. Panel least squares were applied in the test of hypotheses. The result of the analysis showed that board size, firm size and firm age have an insignificant effect on biological assets. The implication is that none of the three variables can predict the increase or decrease in biological assets of agricultural firms in Nigeria. The study recommends that agricultural firms should maintain a robust board size so that they can continue to reap the benefits of the two good heads theory. Efforts should be made to ensure continuous firm growth because of the positive link it has with biological assets. Firms are encouraged to continuously effect changes in both assets and other activities that may be affected by the age of the firm. Management should maintain current innovations in the industry to attract new investors, boost productivity and enhance shareholders’ funds.

Citation: Nnajieze E.I.,  Igwe A.O.,  Nwabuisi A.O. (2022) Responsiveness of Biological Assets to Board size, Firm size, and Firms’ age of Agricultural Firms in Nigeria, European Journal of Accounting, Auditing and Finance Research, Vol.10, No. 11, pp.36-51

Keywords: Board size, Leverage, Liquidity, Profitability, biological assets, firm age, firm size, nigeria agricultural sector

Impact of Social Costs on Financial Performance of Listed Firms in Nigeria (Published)

To succeed in the business world, organisations need to provide reliable and credible efforts to their stakeholders, to ensure that their business activities would not harm the safety of stakeholders in the area where they are operating. The operation of business conducts in recent time, changes drastically due to the emergence of an increasing number of external factors which impose on corporate performance. Hence, this study examined the impact of social costs on the financial performance of listed firms in Nigeria. The study adopted ex-post facto research designs. Secondary data sourced from the published annual reports of 52 firms, purposively selected for a period of 11 years (2008 to 2018), giving 572 firm-year observations. Data analysed by panel data regression of pooled OLS, random effects, fixed effects models and the Feasible General Least Squares (FGLS) regression for the objectives. Findings revealed that Social Costs (SOCO) had significant and positive effect on ROA (R2 = 0.42, β = 0.202, t(570) = 4.869, p < 0.05). In addition there is evidence that SOCO, firm age, firm size and leverage jointly exerted significant effect on ROA (Adj.R2 = 0.608, F(6, 565) = 5904.01, p < 0.05). The study concluded that social costs have a significant impact on the financial performance of listed firms in Nigeria. It recommended that the practice of elimination of social costs should be intensified by corporate firms to improve on their business reputation.

Keywords: Leverage, Return on Assets, business reputation, firm age, firm size, social costs

Evaluation of Integrated Reporting and the Value of Listed Manufacturing Firms in Nigeria (Published)

Integrated reporting is gaining attention of world-leading organizations and countries who are demonstrating global leadership in this emerging field of corporate reporting. However, the disclosure of non-financial information and its integration with financial information (integrated reports) and the benefits to the company and other stakeholders is not yet properly assessed in Nigeria. Prior studies in this area in different environments have produced mixed results and conclusions. This study examined the effect of integrated reporting on the value of listed manufacturing companies in Nigeria. The study adopted ex-post facto research design. The population of the study comprised 53 manufacturing companies quoted on the Nigerian Stock Exchange (NSE) as at 30th June 2017, from which 38 companies were purposively selected comprising companies from consumer goods and industrial goods during the study period (2012-2016). Data were sourced from the published audited financial statements validated by the external auditors’ report. Descriptive and inferential statistics using regression analyses were employed. The findings revealed that integrated reporting had significant effects on firm’s value measured by Tobin’s Q (TQ) (F(4, 131) = 22.75, Adj. R² = .1470, p <0.05). Disclosure of Financial Capital (DFC) had a significant negative effect on TQ (β₁ = -4.41; t(135)= -6.71, p <0.05); Disclosure of Manufactured Capital (DMC) had an insignificant positive effect on TQ (β₂ = 0.051; t(135)= 0.14, p >0.05); Disclosure of Intellectual and Human Capital (DIHC) had an insignificant negative effect on TQ (β₃ = -0.994; t(135)= -0.69, p >0.05); and Disclosure of Natural Capital (DNC) had an insignificant negative effect on TQ (β₄ = -0.438; t(135)= -0.41, p >0.05). Firms’ size (SIZE) and leverage (FLEV) had significantly controlled the influence of integrated reporting on TQ (F(6,129) = 24.08, Adj. R² = .1636, p <0.05). The study concluded that integrated reporting is still at its early stage of adoption in Nigeria and could be useful in determining the firm’s value of listed manufacturing companies in Nigeria. It was recommended that regulators should increase awareness, training and provide a framework for the mandatory adoption of integrated reporting in Nigeria.

 

Keywords: Disclosure, Leverage, Size, firm’s value, integrated reporting, integrated thinking, tobin’s q. transformation, value creation

Evaluation of Integrated Reporting and the Value of Listed Manufacturing Firms in Nigeria (Published)

Integrated reporting is gaining attention of world-leading organizations and countries who are demonstrating global leadership in this emerging field of corporate reporting. However, the disclosure of non-financial information and its integration with financial information (integrated reports) and the benefits to the company and other stakeholders is not yet properly assessed in Nigeria. Prior studies in this area in different environments have produced mixed results and conclusions. This study examined the effect of integrated reporting on the value of listed manufacturing companies in Nigeria. The study adopted ex-post facto research design. The population of the study comprised 53 manufacturing companies quoted on the Nigerian Stock Exchange (NSE) as at 30th June 2017, from which 38 companies were purposively selected comprising companies from consumer goods and industrial goods during the study period (2012-2016). Data were sourced from the published audited financial statements validated by the external auditors’ report. Descriptive and inferential statistics using regression analyses were employed. The findings revealed that integrated reporting had significant effects on firm’s value measured by Tobin’s Q (TQ) (F(4, 131) = 22.75, Adj. R² = .1470, p <0.05). Disclosure of Financial Capital (DFC) had a significant negative effect on TQ (β₁ = -4.41; t(135)= -6.71, p <0.05); Disclosure of Manufactured Capital (DMC) had an insignificant positive effect on TQ (β₂ = 0.051; t(135)= 0.14, p >0.05); Disclosure of Intellectual and Human Capital (DIHC) had an insignificant negative effect on TQ (β₃ = -0.994; t(135)= -0.69, p >0.05); and Disclosure of Natural Capital (DNC) had an insignificant negative effect on TQ (β₄ = -0.438; t(135)= -0.41, p >0.05). Firms’ size (SIZE) and leverage (FLEV) had significantly controlled the influence of integrated reporting on TQ (F(6,129) = 24.08, Adj. R² = .1636, p <0.05). The study concluded that integrated reporting is still at its early stage of adoption in Nigeria and could be useful in determining the firm’s value of listed manufacturing companies in Nigeria. It was recommended that regulators should increase awareness, training and provide a framework for the mandatory adoption of integrated reporting in Nigeria.

Keywords: Disclosure, Leverage, Size, firm’s value, integrated reporting, integrated thinking, tobin’s q. transformation, value creation

Determinants of Survival of Listed Deposit Money Banks in Nigeria (Published)

In the business world, stakeholders are subject to several risks on investment including losing their venture. The existence of a healthy corporate structure is vital to the pursuit of the going concern objective of firms. This study investigates determinants of listed Deposit Money Banks’ (DMBs) survival in Nigeria. The sixteen listed DMBs in Nigeria as at December 2017 were used as the population and fifteen were sampled by applying a judgemental sampling technique. The study adopted descriptive and ex-post facto research design. The Emerging Market score (EM score) model was applied in the prediction of going concern status of sampled DMBs. The data used were obtained from the annual reports and accounts of the DMBs for 2007 to 2017 accounting periods. The data were analysed using Robust GLS Regression model. The study found that there is a positive and significant impact of liquidity, leverage, profitability, solvency and asset management on DMBs’ going concern (GC). This implies that, any increase in these determinants would lead to increase in GC of DMBs. With the adjusted r² of 0.98 and F-value significance at 0.000 from the model used in the study, the study concludes that the independent variables in the EM score model are relevant in determining the GC of DMBs. It is highly recommended that DMBs should enhance their survival status (EM score of 5.48) by improving on their liquidity, profitability, solvency, leverage and asset management ratios to solidify their GC status.

Keywords: Asset Management, EMscore, Leverage, Liquidity, Profitability, Share Price, Solvency

Determinants of Disclosure Completeness of Financial Statements an Empirical Study in Indonesia (Published)

This study aims to determine the effect of firm size, liquidity, and leverage on the completeness of the disclosure of financial statements on mining companies listed on the Indonesia Stock Exchange in 2010-2014. The data used in this research is secondary data, such as financial statements. The number of companies who researched many as 18 companies over five years, bringing the total number of samples totaling 90 samples. Data analysis technique used is multiple linear regression analysis using software eviews 8.0. The results of this study showed that simultaneous company size, liquidity, and leverage significant effect on the completeness of the disclosure of financial statements. Partially size and liquidity significantly influence the completeness of the disclosure of financial statements, but leverage does not significantly influence the completeness of the disclosure of financial statements

Keywords: : Company Size, Financial Statements, Leverage, Liquidity