Quoted Companies In Nigeria Research Articles

Board Structure and Financial Reporting Quality in Quoted Non-Financial Firms in Nigeria

This study investigated board structure and financial reporting quality among quoted non-financial companies in Nigeria. The broad objective was to determine the relationship between, board independence, board expertise, board meetings and audit committee size and financial reporting quality among quoted companies in Nigeria. The study employed ex-post facto research design, covering a period of six years (2013 to 2018). The population size is one hundred and fourteen (114) non-financial companies in Nigeria, while fifty-nine (59) quoted companies constituted the sample size. Content analysis of financial statements of sampled companies were carried out and data were analysed using descriptive and inferential statistics, like correlation matrix and panel least square regression. The study found that board independence, board expertise and audit committee size have significant and positive relationship with financial reporting quality, which by implication, board independence, board expertise and audit committee size were critical factor enhancing financial reporting quality among quoted companies in Nigeria. The research also found board meetings to have negative relationship with financial reporting quality.The study recommended that board of companies should consists of more independence board members made up of male and female with professional financial expertise capable of enhancing financial reporting quality. Keywords: Board independence, Board expertise, Board meeting, Audit committee size, financial reporting quality, Panel Least Square Regression

The Effect of Audit Quality on The Financial Performance of Listed Deposit Money Banks in Nigeria

This study explored the influence of audit quality on the financial performance of listed deposit money banks in Nigeria. It successfully identified a significant and positive relationship between audit quality, represented by audit fees and audit firm specialization, and the performance of the sampled banks measured using ROA (Return on Assets) and EPS (Earnings per Share). The research collected annual data from 2009 to 2021, sourced from the annual reports and accounts of non-financial quoted companies in Nigeria. To address potential endogeneity issues, the study employed feasible generalized least square regression, aligning with the results of diagnostic tests. The analysis outcomes indicated that audit fees had a positive and statistically significant impact on the return on assets and earnings per share of the sampled banks. Similarly, audit specialization exhibited a positive and significant influence on both return on assets and earnings per share. Consequently, the study confirmed a noteworthy positive relationship between audit quality and the performance of Nigerian listed Deposit Money Banks. In light of these findings, the study recommends that regulatory authorities in the sector encourage banks to engage specialized audit firms.

FINANCIAL PERFORMANCE AND COMPANIES INCOME TAX OF LISTED COMPANIES IN NIGERIA

Taxes are compulsory levies that are regularly imposed and as a rule, not designated for a special purpose. The study examined the effect of financial performance and companies income tax of quoted companies in Nigeria. The study adopted ex-post facto research design. The population of this study was all quoted financial and non-financial companies which as at 2019 on the Nigerian Stock Exchange (NSE) was 173 for the period 2006 – 2020 and the sample size was 30 using stratified sampling technique and quota system. Data were sourced from the annual reports of the sampled quoted companies for the study. Data were analyzed using descriptive and inferential statistics. The findings revealed that financial performance has significant effect on companies income tax of the sampled quoted companies in Nigeria (Adj. R2 = 0.789, F(4, 445 ) = 1594.78, P<.05). Firm size was also introduced as a moderating variable and the results also show that it has significant effect on companies income tax in Nigeria (Adj. R2 = 0.36, F(4, 445 ) = 50.17, P<.05. The study concludes that financial performance has a significant effect on the companies income tax of quoted financial and non -financial firms in Nigeria. The study recommends that the management should pay adequate attention and care to their earnings and net profit by improving on their capital employed to further improve the effective tax rate of their companies and Companies should maintain adequate firm size for their operations as it can enhance their performance and will drive corporate taxes

Corporate Governance on Stakeholders’ Obligations of Non-financial Firms Quoted in Nigeria: Moderating Effect of Firm Size and Liquidity

Entities exist to create value for, not only their shareholders but all groups of stakeholders that affect and are affected by the entities’ activities. Studies have however revealed that companies do fall short of meeting stakeholders’ obligations for reasons not unconnected with ineffective corporate governance mechanisms. This study examined the effect of corporate governance on stakeholders’ obligations of non-financial quoted companies in Nigeria and the extent to which firm size and liquidity moderate this effect. The study adopted ex-post facto research design and the population comprised 73 companies from the non-financial sectors that have faced financial distress in the period of consideration and shall be classified as failed or financially distressed firms. Using the purposive sampling technique, a sample of 52 delisted or suspended firms were selected for the study using stratified and purposive sampling techniques. The study used data extracted from the annual reports of the sampled companies covering 2008 to 2019. The finding revealed that corporate governance had a significant effect on stakeholder’s obligations (Adj R2 = 0.117, Wald-Test = 32.57, p = 0.000). The study further shows that firm size and liquidity significantly moderated the effect of corporate governance on the stakeholders’ obligation of non-financial firms quoted in Nigeria. On the basis of these empirical findings, the study recommended that the management of non-financial quoted firms in Nigeria should properly consider their size and liquidity positions in their corporate governance policy.

Tax Planning, Corporate Governance and Financial Performance of Selected Quoted Non-Financial Companies in Nigeria (2007–2018)


 
 
 This study examines the interactive effect of tax planning and corporate governance on the financial performance of 50 non-financial quoted companies in Nigeria between 2007 and 2018. The study sample that covers 9 sectors was selected purposively through stratified random sampling. Data used were collected from the audited annual reports and accounts of selected quoted companies in Nigeria and fact books published by the Nigeria Stock Exchange. A system GMM was employed to estimate the dynamic models, and results show that ownership structure (OS) and capital intensity (CI) exerted a significant and positive impact on the returns on assets. This implies that OS plays a significant role to ensure that CI triggers an increase in the return on assets of the quoted Nigerian companies. However, board diversity and thin capitalization wielded a significant and negative influence on return on assets. This study thus recommends that companies should put in place a strong corporate governance mechanism that will monitor, check and balance tax planning activities and strategies adopted by the management of quoted companies in Nigeria.
 
 

Liquid Stock and Dividend Payment of Non-financial Quoted Companies in Nigeria

Payment of dividends among firms in Nigeria has become irregular and setting an optimal dividend policy has become an herculean issue. Studies in developed countries indicated that stock liquidity influences dividend payout and this has not been well established in Nigeria. Hence, this study examined the effect of liquid stock on dividend payment of fifty (50) non-financial quoted companies in Nigeria between 2012 and 2019. The study employed secondary source of data collection and analysis was done using descriptive statistics and inferential statistics. The study model expressed the effect of Turnover Ratio, Firm Size, Financial Leverage, Cash Holding and Investment Opportunity on Dividend Payment Ratio using OLS Panel Regression. The results based on the random effect model showed that turnover ratio (TOR) which is a proxy for liquid stock accounts for a significant positive influence on dividend payment while other variables showed negative influence except cash and cash equivalent. Based on the above findings, the study concluded that for most of the companies operating in the non-financial sector of the Nigerian economy, the influence of liquid stock on the amount paid as dividend is positive and significant and those firms with more liquid stocks pay higher amount of dividend than those with less liquid stocks.

English

Economic sustainability reporting enhances the financial strength of the company by meeting the diverse needs of stakeholders. Whereas, financial performance covers about 25% of the economic sustainability performance indicators as indicated in the GRI-4. To this extent, the study helps to fill this gap by considering the effect of corporate governance on economic sustainability reporting in quoted companies on Nigerian Stock Exchange. This study adopted ex-post facto research design. The population of the study comprised 169 quoted companies on the Nigerian Stock Exchange (NSE) as at December 31, 2019. A sample of 42 quoted companies for the period of 10years (2010-2019) was selected. Data were extracted from published audited annual reports and accounts of the companies. Data were analyzed using descriptive and inferential statistics. The hypotheses were tested at 0.05 significance level. The findings revealed that board size, female director and board ownership have positive and significant effect on economic sustainability reporting of selected quoted companies in Nigeria while CEO duality has negative effect on economic sustainability reporting and independent director has insignificant effect. The study concluded that corporate governance promotes economic sustainability reporting. It was recommended that the shareholders of companies should appoint experienced board members that will enhance sustainability reporting appoint more directors with shareholding interest and include more female on the board, as they boost economic sustainability reporting.   Key words: Board independence, board ownership, board size, CEO duality, economic sustainability reporting, female directors.

Do corporate attributes drive integrated reporting amongst listed companies in Nigeria?

Research purpose: The purpose of this paper was to investigate the association between corporate attributes and the implementation of Integrated Reporting (IR) among quoted companies on the Nigerian Stock Exchange which currently operates a voluntary based disclosure environment.Design and method: Using content analysis to derive the disclosure scores for integrated reporting and corporate attributes, the authors investigated the impact of corporate attributes on the implementation of the integrated reporting of a sample of 90 listed firms. The annual reports covering 2013–2017 were analysed using the disclosure methodologies developed by prior researchers in IR. The hypotheses were tested using panel least square regressions.Main findings: The authors found that corporate attributes have a statistically positive and significant impact on the implementation of integrated reporting framework, that share ownership structure and firm age have an insignificant influence over corporate implementation of the integrated reporting framework. The research findings extend integrated reporting research in Nigeria from mere primary data analysis to quantitative data analysis.Practical implications: The empirical findings provide regulators with evidence on the current level of integrated reporting disclosures and the influence of corporate attributes in driving integrated reporting.Originality and value: The study makes significant contributions to integrated reporting literature from a developing country’s perspective. It also provided empirical evidence of a high level of disclosure compliance with the IR framework among quoted companies in Nigeria.

Income Smoothing: A Means for Organizational Survival

This study examined the influence of income smoothing on organizational survival of selected quoted companies in Nigeria. The research study embraced the ex-post facto study design with a substantial dependence on secondary data produced from the annual reports of companies through 2007-2018. The population of the research study included 168 companies quoted on the Nigerian Stock Market (NSE) where a sample of 20 companies were attracted utilizing the judgmental sampling strategy. The Eview 9.0 analytical software application was utilized to examine the data. The research study wraps up that there is a connection in between the dimensions of income smoothing and organizational survival. Based upon the findings, the research study advises that appropriate and ideal procedure must be established for sufficient examination, evaluation and scrutinization of financial declarations of quoted companies. Likewise, the Nigerian Accounting Standard Board (NASB) ought to be more equipped to prepare a well-structured framework of accounting regulation, approve, review and examine financial declarations of all companies quoted on the Nigeria Stock market to guarantee conformity with GAAP, IFRS, CAMA and various other financial coverage Act. The paper advocates for extra strict supervisory system with operational implementation tools to ensure compliance with International Financial Reporting Standard and Auditing standards with the purpose of reducing income smoothing practices. The introduction of punitive measures could also assist in curbing the act of income smoothing amongst Nigerian companies. Keywords: Income smoothing, Organizational survival, Nigerian Stock Market DOI: 10.7176/RJFA/12-14-04 Publication date: July 31 st 2021

Working capital management and financial performance of non financial quoted companies in Nigeria

This study examines the effect of working capital management on the financial performance of Non-financial companies quoted on the Nigerian Stock Exchange over the period 2014 – 2018 while using a panel research design. This work is unique because it considers a sample of 71 companies drawn from all the 10 non-financial sectors of the NSE. Unlike most extant studies, financial performance was captured by earnings per share as a proxy, while the right-hand side variable being working capital management was denominated by Accounts receivable period, Inventory turnover period, and Accounts payable period. This study also considered the effect of some control variables namely annual capital expenditure, age of firm, GDP, firm size, growth of the company, and firm leverage on EPS. Data were retrieved from the Nigerian Stock Exchange 2019 Factbook. The model estimation technique adopted was the Pooled Ordinary Least Squares, fixed effect, and random-effect methods. Results from this study are consistent with the theoretical position that all aspects of working capital management have a significant effect on financial performance. While ITP and ACP were negatively related to EPS, APP was found to have a positive relationship with EPS. The research results also reveal that although all the control variables were found to be significant, only the age of the firm was deemed to be positively related to EPS. Based on the findings, the research recommends that firms should focus their managerial attention on lowering their ITP and ACP while increasing their APP, as results indicate that management of these elements of working capital can translate into liquidity and higher profitability.

Corporate Governance and Sustainability Reporting: The Controlling Effect of Company Size and Age in Selected Listed Firms in Nigeria

As a result of the deficiency of traditional financial reporting in information disclosure to stakeholders, the need for sustainability reporting has become a global phenomenon. This study investigated the controlling effect of company size and company age on corporate governance and sustainability reporting in selected quoted companies in Nigeria The study adopted ex-post facto research design. The population of study comprised 169 quoted companies on the Nigerian Stock Exchange (NSE) as at December 31, 2019. A sample of 42 quoted companies was selected through stratified and purposive sampling techniques for the period of 10years (2010-2019). Data were extracted from published audited annual report and accounts of the sample companies. Data were analyzed using descriptive and inferential (Multiple regression) statistics. The findings revealed that company size and company age controlled the effect of CG on sustainability reporting in Nigeria (Adj R 2 = 0.378, Wald-Stat = 447.64, p< 0.05). In addition, there is evidence that board size, board independence, female director, board ownership, company size and company age have significant relationship with sustainability reporting (BS= 0.349, t-test= 3.283, p< 0.05, BI= 0.336, t-test= 2.087, p< 0.05, FD= 1.208, t-test= 12.411, p< 0.05, BO= 0.004, t-test= 7.837, p< 0.05, CZ= 0.108, t-test= 6.328, p< 0.05 and CA = 0.154, t-test= 3.395, p< 0.05). However, CEO duality do not have significant relationship with the sustainability reporting (CD = 0.113, t-test= 1.668, p> 0.05) The study concluded that company size and company age controlled the effect of corporate governance on sustainability reporting. The study recommended that the shareholders should include more female and independent directors on board as it promotes sustainability reporting practices. Also, the shareholders are advised to include more directors with share ownership as it enhances sustainability reporting practices and CEO duality should be avoided as it does not significantly impact SR.

Creative Accounting Practice Among Public Limited Companies in Nigeria: Prevalence, Motives and Techniques

The study was to determine the prevalence of creative accounting practice, motive, and techniques employed among Public Limited Companies in Nigeria. The data obtained from professional accountants in public practice was analyzed using descriptive statistical techniques. All the respondents admitted to having encountered the practice among their clients in the course of their work as auditors. Officials’ gains and quest to gain stock market advantage was found to be the most popular motives for creative accounting practices among public limited companies in Nigeria. Fraudulent stock valuation and depreciation policies are the techniques mostly applied by the companies for the manipulations. Majority, seventy-two percent (72%) of participants admitted that creative accounting is either “totally legal” or “legal” if perpetrators simply exploit the loopholes in the standards, without being fraudulent and is rife among quoted companies in Nigeria and thus need to strengthen institutions regulating accounting.

Audit Committee Characteristics and Investors’ Stake in Nigerian Quoted Companies

Financial scandals that occurred in the early 21st century have put to test the integrity of financial reports that relay the performance of an entity to its investors. The audit committee has been argued in the extant literature as a factor that can put to rest the prevalence of these scandals. Nevertheless, these scandals still recur. This study investigated the nexus between audit committee qualities and investors’ stake in quoted companies in Nigeria. Ex-post facto was adopted as the research design, while the Fixed Effect Panel Analysis and Pairwise Granger Causality Test were used to analyze the data. The results of the Fixed Panel Analysis revealed that the financial expertise, audit committee meetings, numbers of non-executive directors on the audit committee, audit committee size, and the proportion of nonexecutive directors on the board of the selected companies demonstrated an insignificant effect on investors’ stake in the selected quoted companies in the country, while the Panel Granger Causality Test revealed unidirectional causality between earnings per share and proportion of non-executive directors of the company’s board in selected quoted companies in Nigeria. This study concluded that audit committee quality has affect on investors’ stake depending on the qualities adopted by the audit committee. Based on the above, the study recommended among other things, that the management and government should devise internal control mechanisms or strategies that will ensure the suitability of who could act as an independent nonexecutive director to a company. KEYWORDS: Audit Committee Qualities, Performance, Earning per Share, Standard Variance, Stakeholders.

EFFECTS OF MACROECONOMIC FACTORS ON STOCK RETURNS IN NIGERIA

Purpose: This study set out to examine the effects of macroeconomic factors on stock returns for top twenty-five most capitalized quoted equity firms in Nigeria. Emerging markets have different structure and institutional characteristics from developed stock markets, and in view of the fact that investors are interested in getting more insights into the activities of blue chip companies, it is imperative to find out whether stock returns in Nigeria respond differently to effects of macroeconomic factors or not. Hence, the study investigated the effects of inflation rate, interest rate and money supply on stock returns of selected quoted firms in Nigeria from 2007 – 2016.
 Methodology: The population comprises top twenty-five most capitalized quoted equity firms, out of which twenty-one companies represent the sample of the study. The study adopted ex-post facto research design. The study used secondary data obtained from the audited accounts of the sampled firms, Central Bank of Nigeria Statistical Bulletin and the Nigerian Stock Exchange database and website. Analysis of data was carried out using panel data regression.
 Findings: The panel regression results indicate significant negative effects between inflation rate, money supply and stock returns of selected quoted companies in Nigeria, while insignificant negative effect is revealed between interest rate and stock returns in Nigeria.
 Unique contribution to theory, practice and policy: The study recommends among others, taking note of the systematic risks revealed by inflation rate, interest rate and money supply when structuring portfolios and diversification strategies; and intensifying capital market sensitization campaigns by the Securities and Exchange Commission.
 Keywords: Inflation rate, interest rate, money supply and stock returns.

Dividend Policy and Share Price Fluctuations of Sampled Quoted Nigerian Companies

This focus of the study was to find out the impact of dividend policy on market price of shares on sampled quoted companies in Nigeria. Secondary data were sourced from the audited annual reports of ten selected companies, the prices from Central Security Clearing System‘s portal (CSCS) and annual returns on Nigeria Stock Exchange All Share Index-NSEASI from Proshareng.com for the period of 2011 to 2015. The data were analysed by the use of ols regression technique to find the level of significance of the variables: dividend payout ratio earnings per share and economy status on share price of sampled companies in Nigeria. The findings revealed that dividend payout ratio and earnings per share have significant effects on share price of equity while the economy status has insignificant effect on the share price of equity. The study also showed that earnings per share has a higher effect than dividend payout ratio and economy status of the country on market price of share of sampled companies in Nigeria during the period under review. It is recommended that in this recession period, risk averse investors should focus on high dividend payout ratio equities ,however they should be careful of these stocks because it means the companies may not have enough retained earnings to invest in profitable investments.

Corporate Governance and Tax Planning Among Non-Financial Quoted Companies in Nigeria

The study examined the impact of corporate governance on tax planning of non-financial quoted companies in Nigeria between 2004 and 2014.A sample of fifty (50) companies out of 151 non-financial quoted companies that covers 10 sectors were purposively selected on stratified random sampling basis. The data used in the analysis were collected from the audited financial statement of the selected non-financial quoted companies in Nigeria and Nigeria Stock Exchange Fact books and analysed using generalizes method of moments (GMM). The result showed that there is positive and significantly relationship between Effective Tax Rates (ETR) and firm value (TobinQ). The positive relationship as shown in the result implies that tax planning activities has not be benefiting the increase in firm value.All the variables such as leverage (LEV), Liquidity (LIQ), Net Working Capital (NWC), Growth opportunities (MTB) and capital intensity (CIN) were found to have a positive and significant relationship with the firm value.The recommendation thus is that firms need to institute more healthy tax planning practices and engage the services of professional tax consultants for higher firm value. Key Words: Tax Planning, Effective Tax Rate, Firm Value, Nigeria

Accounting Conservatism and its Benefits to Shareholders in Developing Capital Market: Evidence from Nigeria

This study investigated the relationship between accounting conservatism and shareholders value of selected quoted companies in Nigeria. The proxy for accounting conservatism was asymmetric accrual to cash-flow (AACF) and shareholders fund was the proxy for shareholders value. Exchange and inflation rates were included as control variables. This study adopted ex-post facto research design. The population of the study was all quoted companies on the Nigeria Stock Exchange from which a sample of 20 companies was chosen using judgmental sampling technique. Secondary data was obtained from annual report and accounts of the sampled companies for a period of ten years (2006 to 2015). Multiple regression analysis was used to analyze the data collected. The hypothesis was tested using F-Statistic. The result of the study revealed existence of a significant positive relationship between accounting conservatism and shareholders value with F-statistic p-value of 0.016 for all our explanatory variables. This result was validated with robustness checks and it was discovered that the relationship between conservatism and shareholders value was high for firms with higher information asymmetry. The finding implies that accounting conservatism is an efficient governance mechanism to mitigate information risk and control for agency problems. Hence, we concluded that shareholders derive benefits from accounting conservatism practice in Nigeria.

Auditors Reputation : The Impact on Compliance with International Accounting Standard 5 by Quoted Companies in Nigeria

Auditors Reputation : The Impact on Compliance with International Accounting Standard 5 by Quoted Companies in Nigeria

Audit Quality and Accrual – Based Earnings Management of Quoted Companies in Nigeria

This study examines the impact and relationship between audit quality and cash - based earnings management of companies in Nigeria. Using archival data based on a sample of 342 companies – year observations from the NSE and applying some commonly applied audit quality measures for purpose of robustness, a massive and all-inclusive multivariate analyses was conducted. The result showed that audit quality exerts significant negative relationship with cash - based earnings management of quoted companies in Nigeria. The study recommends that Professional Accountancy Bodies, the Financial Reporting Council of Nigeria and the Nigerian National Assembly should issue authoritative code for audit quality; companies should improve their earnings quality only through sales growth, cost control and cost reduction strategies; companies in Nigeria should present distinct statements of earnings quality while auditors should issue Integrated Audit Quality Assurance Report based on earnings quality assessment, supported by current best practices, statutorily backed by earnings monitoring of companies in Nigeria.

Compliance with the Requirements of Accounting Standard by Quoted Companies in Nigeria

This paper examines the level of compliance with the requirements of statement of Accounting Standards number 16 by Insurance Companies listed on the Nigerian Stock Exchange (NSE). The basic objective is to find out whether or not listed insurance companies in Nigeria apply the requirements of the standard relating to Accounting for Insurance Business. The population of the study is composed of all the insurance companies quoted on Nigerian Stock Exchange. The paper uses annual accounts and reports of 5 insurance companies. The technique of analysis adopted was the qualitative grading system, while the sample was selected using stratified random sampling technique of which 5 out of 19 quoted insurance companies which engage in composite insurance business were sampled. Results from the analysis shows that a gap exists between what insurance companies do and what is required of them by SAS 16, that is, compliance with the requirements of SAS 16 by listed insurance companies is good (i.e. 76.9%) and by our criterion we referred to it as compliance within the semi-strong range, which we discover to be inadequate, because accounting standards are expected to be complied with in total, that is 100% compliance. Therefore, the paper calls on the newly empowered NASB to, as a matter of urgency, organize campaigns and propaganda with sole aim of enlightening not only corporate bodies but also individual stakeholders on the advantages derivable from complying with accounting standards to intensify the relevance of the NASB Act 2003 to the insurance industry to achieve uniformity in financial reporting that meets the NASB requirements and finally to reduce the incidence of breach of the NASB Act 2003 and enhance compliance with set accounting standards.