European Journal of Accounting, Auditing and Finance Research (EJAAFR)

EA Journals

Non-financial firms

Board Structure and Accounting Conservatism in Listed Non-Financial Firms in Nigeria (Published)

The study examines the impact of board structure on accounting conservatism in listed non-financial firms in Nigeria. The longitudinal research design was adopted and the study covered the period from 2010-2019. study period, there are 75 quoted non-financial firms in the Nigerian Exchange Group classification and these will constitute the sample.  In this study, secondary data, by way of annual reports and accounts of the sampled companies in Nigeria and some relevant Nigerian Exchange Group fact books were used to collect data. The effect of corporate governance structure on accounting conservatism was analysed using panel regression. This study employed descriptive statistical methods and includes descriptive techniques such as the mean, standard deviation, range, frequency distribution. More importantly, the random effects (RE) and fixed effects (FE) regression as estimated. The findings of the study reveals that Board size (BDS) has a significant impact on accounting conservatism particularly for Market to book (MTB) and income statement based indicators of accounting conservatism. Also, Board independence (BDIND) has a significant impact on accounting conservatism and this is persistent across all three measures of accounting conservatism used in the study. Board gender diversity (BGD) has a significant impact on accounting conservatism particularly, for accrual based indicators. Hence the study recommends the need for corporate boards to reflect and represent all significant stakeholder interests so that board decisions will not be skewed unhealthily. Therefore, the study recommends for the presence of more independent directors in corporate boards. The study recommends the need for an increase in the level of gender diversity in corporate boards. The study recommends that there is need for shareholders to look closely in order to monitor the practices of management.

Citation: Chiedu Christian O., Anichebe, S. A., Emeka-Nwokeji, N. A. (2022) Board Structure and Accounting Conservatism in Listed Non-Financial Firms in Nigeria, European Journal of Accounting, Auditing and Finance Research, Vol.10, No. 3, pp.42-58


Keywords: Accounting Conservatism, Board Structure, Nigeria, Non-financial firms

Relation between Audit Risk and Audit Fees – Evidence from Listed Firms in the Us (Published)

This study analyses association between audit risk and audit fees and also studied the influences of industry differences on audit pricing-risk association. Strong empirical evidence has found to suggest that the inherent risk and control risk have positive influence on audit fees. The sample of empirical research comprises a total of 507 listed companies, 260 observations in the United States in 2007 fiscal year and separated into two sub-samples, financial and non-financial firms. Client financial distress factor was tested with the help of Z-score model. The analysis shows that in the similar level of total assets financials are charged lower audit fees than non-financial firms and compared with financials, the audit fees for nonfinancial firms are more sensitive to the financial indicators. It also concluded that the auditors did not seem to take financial firms business risk into consideration when decided audit fees as there is a positive relation between audit fees and companies’ solvency and the possibility of bankruptcy. Auditors considered not only the non-financial firms’ profitability, but also the liquidity, activity, solvency and possibility of bankrupt when they decide audit fees.

Keywords: Audit Fees, Audit Risk, Control Risk, Detection Risk, Inherent Risk, Non-financial firms

The Impact of Working Capital Management on Corporate Performance: Evidence from Listed Non-Financial Firms in Ghana (Published)

Working Capital Management (WCM) plays a significant role in the successful operation of businesses due to its significant effect on corporate profitability and liquidity. This study empirically examines the impact of working capital management on the performance of non-financial firms in Ghana. Using secondary data of five listed non-financial firms for the period 2010-2015, the Random effect model was employed to establish the relationship that exists between the various components of working capital management and firm performance and whether these WCM components impact significantly on firm performance. The results show that average payment period and current ratio have a positive relationship with firm performance. Average collection period, inventory turnover, cash conversion cycle, and firm size on the other hand have a negative relationship with firm performance. However, only average collection period, average payment period, cash conversion cycle, and current ratio are found to have a significant impact on firm performance. The study recommends that managers of non-financial firms in Ghana should formulate sound working capital management policies that will enable firms to deal with liquidity challenges and enhance their performance.

Keywords: Non-financial firms, Performance, Working Capital Management

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