Impact of Board Attributes on Real Earnings Management of Listed Consumer Goods Companies in Nigeria
DOI:
https://doi.org/10.61143/umyu-jafr.2(2)2021.001Keywords:
Board Attributes, Real Earnings Management, Agency TheoryAbstract
This study examines the impact of board attributes on real earnings management of listed consumer goods companies in Nigeria. Secondary data were sourced from the annual reports of 16 listed consumer goods companies on the Nigerian Stock Exchange for the period 2011 to 2020. Ordinary least square regression was used. The study measured board attribute with board size, board independence and board financial expertise, while the dependent variable real earnings management with Srivstava (2019) Cohort Adjusted Measure, whereas firm size, firm growth and firm age were used as control variable. The study documents that board size and board financial expertise has significant negative impact on real earnings management of the listed consumer goods companies in Nigeria. Furthermore, board independence has significant positive impact on real earnings management of listed consumer goods companies in Nigeria. In line with the findings, the study recommended that regulatory bodies like FRCN, SEC, and NSE should ensure that listed consumer goods companies in Nigeria increase the size of the board and directors who are expert in finance as it will decrease the level of real earnings management and non-executive directors number shall be reduced as it increases the level of real earnings management.
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