CORPORATE GOVERNANCE AND QUALITY OF FINANCIAL REPORTING BY BANKS IN NIGERIA
The level of owners investment required to finance deposit money banks in Nigeria is getting astronomical by the day as the regulatory authorities believe that only a robust capital base can assist to ward off undue competition occasioned by the recent liberalisation of the industry. The high stake...
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| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
Kwara State University, Malete Nigeria
2023-11-01
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| Series: | Malete Journal of Accounting and Finance |
| Subjects: | |
| Online Access: | https://majaf.com.ng/index.php/majaf/article/view/24 |
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| Summary: | The level of owners investment required to finance deposit money banks in Nigeria is getting astronomical by the day as the regulatory authorities believe that only a robust capital base can assist to ward off undue competition occasioned by the recent liberalisation of the industry. The high stake by owners and the excessive work load on executives in the industry always make stakeholders to demand that operational effort at all levels be close to perfection, with appropriate control mechanism to ensure compliance. This therefore necessitates some codes that will guide the relationship between owner’s representative and executives, to ensure a balanced corporate administration. This study examines the relationship between elements of good corporate governance and quality of financial reporting (measured as discretionary accruals) by deposit money banks in Nigeria. The major study objective is to determine whether or not the elements of good corporate governance actually reduce the vulnerability of financial institutions to the excesses of the managers. The study employs a Generalized Method of Moment (GMM) for a period of seven years (2012-2018). The study found that both board composition and audit committee size have negative impact on discretionary accruals, and positive impact on the quality of financial reporting. The study therefore, concluded that board composition can be used to achieve better financial reporting quality. It also recommends that the composition of board of directors be improved as well as the number of directors in the audit committee in order for them to perform their internal audit role more effectively.
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| ISSN: | 2735-9603 |