The effect of audit committee characteristics on earnings management in Nigerian listed firms

Authors

DOI:

https://doi.org/10.15587/2706-5448.2023.272875

Keywords:

audit committee, financial expertise, firm size, earnings management, discretionary accruals, Listed Firms in Nigeria

Abstract

This study focuses on the effect of audit committee characteristics on earnings management among Listed Firms in Nigeria with aim to ascertain whether audit committee characteristics has effect on earnings management. Audit committee in an organization is to support firm’s governance and oversight functions with the regard to financial reporting, risk management system internal control structure, ethical accountability and internal and external audit functions. Earnings management is an attempt by managers to alter financial information either for their private gain or for the gain of stockholders. The study population was 190 firms listed in the Nigerian Stock Market. The study sample was 150 firms because 40 firms could not provide the needed data for the study as at 2014 to 2019. The study data was generated from the Thomson Reuters Data stream and other variables were handpicked from the firm’s annual reports covering the period of 2014–2019. A Generalized Least Square (GLS) estimator was used in estimating the parameters. The study provides positive and significant relationship between Audit Committee Independence (ACIND), Audit Committee Meetings (ACMT) and Earnings Management of listed Nigerian Firms in Nigeria. However, negative relationship between Audit Committee Size, Audit Committee Financial Expertise, Firm Size and Earnings Management was reported among the Listed Firms in Nigeria. Policy maker should provide policy on the composition of Audit for the committee members to clearly spelt out to enable members perform their functions effectively. Further study should look at diversity of audit committee, ethnicity, and religious influence because of the Nigerian diversity on ethnicity and religion.

Supporting Agency

  • Presentation of research in the form of publication through financial support in the form of a grant from SUES (Support to Ukrainian Editorial Staff).

Author Biographies

Abdulsalam Nasiru Kaoje, Usmanu Danfodiyo University Sokoto

PhD

Department of Accounting

Mohammed Yusuf Alkali, Waziri Umaru Federal Polytechnic Birnin Kebbi

PhD, Head of Department

Department of Accountancy

Abubakar Modibbo, Federal University Birnin Kebbi

Lecturer

Department of Accounting

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The effect of audit committee characteristics on earnings management in Nigerian listed firms

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Published

2023-01-30

How to Cite

Kaoje, A. N., Alkali, M. Y., & Modibbo, A. (2023). The effect of audit committee characteristics on earnings management in Nigerian listed firms. Technology Audit and Production Reserves, 1(4(69), 6–13. https://doi.org/10.15587/2706-5448.2023.272875

Issue

Vol. 1 No. 4(69) (2023): Economics of enterprises. Macroeconomics

Section

Economics and Enterprise Management

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Copyright (c) 2023 Abdulsalam Nasiru Kaoje, Mohammed Yusuf Alkali, Abubakar Moddibo

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