Board Specific Attributes and Financial Reporting Quality of Listed Consumer Goods Firms in Nigeria

Clement Okeke

MPRA Paper from University Library of Munich, Germany

Abstract: Financial reporting quality is very important in the consumer goods sector in Nigeria as it guarantees transparency, accountability, and investors’ confidence. Meanwhile, the high-profile scandals that resulted in the loss of multiple investments at the beginning of the 21st century linked to lapses in financial reporting quality have continued to cast doubts in the minds of investors about the reliability of financial reports that are churned out by financial experts in all the sectors including the consumer goods sector. Some scholars have reviewed different variables that impact the quality of financial reporting such as a review of the effect of board characteristics on the financial reporting quality of firms, a review of corporate governance on the quality of financial reports, and so on. However, there is a need to carry out more of such investigations in a sector such as the consumer goods industry due to its vital role in the economic development of any nation. This paper therefore examined the relationship between Board Specific Attributes and Financial Reporting Quality of Listed Consumer Goods Firms in Nigeria. The study used an ex post facto research approach and secondary data were retrieved from the annual financial reports of selected consumer goods firms in Nigeria for eleven years from 2013-2023. STATA 13 was used to carry out correlation and regression analysis of the effects of relevant variables. The study confirmed that board size had a significantly negative effect on the financial reporting quality of listed consumer goods firms in Nigeria. The study also found that board independence and board diversity had negative and insignificant effects on the financial reporting quality of the listed consumer goods firms. The study therefore recommended that consumer goods firms need to reduce the number of non-executive directors on the board to minimize management costs. The study also encourages the firms to have a good mix of experience, gender balance, and independence in the boards’ configurations.

Keywords: Board Specific Attributes; Board Independence; Board Diversity; Board Size; and Financial Reporting Quality (search for similar items in EconPapers)
JEL-codes: G3 G32 M40 (search for similar items in EconPapers)
Date: 2024
New Economics Papers: this item is included in nep-acc
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Published in International Journal of Accounting, Finance and Information System 2.5(2024): pp. 206-2018

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