Ownership Concentration and Earnings Management of Listed Manufacturing Firms in Nigeria: Audit Committee Financial Expertise (Published)
Significant corporate shareholders can exert undue pressure on managers to enhance earnings in order to increase corporate value, and that as a result of this undue pressure, managers to resort to earnings management practice in the corporations they manage. This study examined the moderating role of audit committee expertise on the relationship between ownership concentration and real-earnings management in Nigeria. The independent variable (ownership concentration) was measured as shareholders who have more than 5% equity stake in a company, and real-earnings management was measured using the Roychowdhury approach. Audit committee financial expertise which is the moderator, was measured in binary form, 1 if at least one member of the committee has accounting experience, and 0 otherwise. This paper used a sample of 34 manufacturing companies listed on the Nigerian Exchange (NGX) over a period of 15 years from 2007 to 2021. Data was collected from the annual financial reports of the sampled companies. Descriptive statistics, Pearson correlation and Quantile regression was employed for data analysis and the findings show OWNCON has a positive and insignificant effect on REM. However, when audit committee financial expertise was used as a moderator, the effect of ownership concentration on the real- earnings management of listed manufacturing companies in Nigeria became statistically significant. Based on the findings, the study recommends that manufacturing companies should have more concentrated owners because the higher the concentration the less tendency of REM of listed manufacturing companies in Nigeria.
Citation: Irom M.I., Okpanachi J., Ahmed N.M. and Agbi S.E. (2023) Ownership Concentration and Earnings Management of Listed Manufacturing Firms in Nigeria: Audit Committee Financial Expertise, International Journal of Business and Management Review, Vol.11, No. 2, pp.50-73
Keywords: Earnings Management, audit committee financial expertise, ownership concentration, real earnings management
Usefulness of Voluntary Disclosures in Annual Reports of Listed Companies in Nigerian: An Examination of Users’ Perception (Published)
In spite of the increase in firms disclosing information beyond mandatory information to meet the broad range of users’ information needs, there is limited knowledge from Nigeria as a developing economy on whether voluntary disclosures are useful for the user’s judgments and decisions. That is, research validating that additional disclosures enhance users’ decision making is limited. The purpose of this study is to evaluate whether users in Nigeria perceive voluntary disclosures in annual reports to be useful when making investment decisions. To measure users’ perception, survey research design was employed. Relevant data were obtained from survey of seven user groups (Investors, Accounting Practitioners, Regulators, Financial analysts, Academics, Customers and Students) in South East Zone of Nigeria to test the hypothesised usefulness. Empirical results were obtained through one sample t-test using SPSS software. Results revealed that voluntary disclosure of forward looking information is reliable for detecting earnings management. Voluntary disclosure of sustainability, environmental and social issues provide better understanding of companies’ long term performance. Based on the findings, it was recommended among other things that companies in Nigeria should adopt voluntary disclosures to supplement the conventional reporting model, since the new forward looking reporting framework create longer term value, and also drives quality capital market decisions.
Citation: Emeka-Nwokeji, N. A., Ekwueme, C. M.,Okeke, P. C.(2021) Usefulness of Voluntary Disclosures in Annual Reports of Listed Companies in Nigerian: An Examination of Users’ Perception, International Journal of Business and Management Review,Vol.9, No.5, pp.22-48
Keywords: Earnings Management, Perception, Reliability, Usefulness, Voluntary Disclosure, forward looking information
IFRS ADOPTION AND ACCOUNTING QUALITY OF QUOTED MANUFACTURING FIRMS IN NIGERIA: A CROSS SECTIONAL STUDY OF BREWERY AND CEMENT MANUFACTURING FIRMS (Published)
This paper investigates the differences in the quality of accounting information Pre and post IFRS adoption by manufacturing firms in Nigeria over a five year period. Multiple regression analysis was performed on accounting quality variables and t-test was carried out for equality of mean to compare pre and post IFRS. Results indicate a decline in accounting quality using earnings management, value relevance, and timely loss recognition as independent variables. Earnings and book value of equity are less value relevant and timely loss recognition is less in post-IFRS compared to pre-IFRS period
Keywords: Accounting quality, Earnings Management, IFRS, Timely loss recognition, Value Relevance