Examination of the relationship between audit committee characteristics and financial reporting quality of Nigerian deposit banks

Fodio Inuwa Musa (), Foluke Omolayo Oloruntoba () and Victor Chiedu Oba ()
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Fodio Inuwa Musa: Nasarawa State University, Department of Accounting
Foluke Omolayo Oloruntoba: Nasarawa State University, Department of Accounting
Victor Chiedu Oba: Nasarawa State University, Department of Accounting

EuroEconomica, 2014, issue 1(33), 57-65

Abstract: This study investigates the effects of audit committee characteristics on the quality of financial reporting by deposit banks in Nigeria. The study employs a multivariate regression analysis to assess the aggregate and individual effect of certain audit committee characteristics on financial reporting of sample banks. The study documents a positive relationship between audit committee independence and quality of financial reporting. Findings also revealed that audit committee expertise has positive effect on the quality of financial reporting. Results demonstrate that audit committee size has an insignificant effect on quality of financial reporting; however, an aggregate significant effect of audit committee characteristics on financial reporting quality was established. The recommendations from this study highlight the need for financial expertise as a means of strengthening the monitoring and oversight role that the audit committee plays in financial reporting. Also, emphatic considerations should be given to audit committee independence as a key factor for ensuring the credibility of financial reports.

Keywords: financial credibility; audit independence; accruals; audit committee size. (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (3)

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