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Does Earnings Management Practice Affect The Performance Of Listed Consumer Goods Firms In Nigeria?

Author

Listed:
  • Oyefemi Olympus OWORU

    (Department of Accounting, Federal University of Agriculture, Abeokuta, Nigeria)

  • Jayeola OLABISI

    (Department of Accounting, Federal University of Agriculture, Abeokuta, Nigeria)

  • Olagunju ADEBAYO

    (Department of Accounting, Osun State University, Nigeria)

  • Efetobore OKORODUDU

    (Department of Accounting, Federal University of Agriculture, Abeokuta, Nigeria)

Abstract

The study investigated the effect of earnings management practices on the financial performance of listed consumer goods firms in Nigeria. The study adopted ex-post-facto design to collect data for the study on the events already in existence. The purposive sampling technique was employed to select 10 firms out of 21 listed firms contingent on the availability of data. The study generated secondary data, over a period of eleven years 2008-2018, from the audited financial reports of sampled firms. The data were analyzed using descriptive and inferential statistics coupled with multiple regressions. In the model, Return on Asset (ROA) was used to measure financial performance while Earnings per Share (EPS), Operating Cash Flow (OCF), and Firm Size (FSIZE) were surrogates for earnings management. The study showed a significant and positive influence of EPS on ROA (p-value

Suggested Citation

  • Oyefemi Olympus OWORU & Jayeola OLABISI & Olagunju ADEBAYO & Efetobore OKORODUDU, 2020. "Does Earnings Management Practice Affect The Performance Of Listed Consumer Goods Firms In Nigeria?," Contemporary Economy Journal, Constantin Brancoveanu University, vol. 5(1), pages 94-103.
    • Handle: RePEc:brc:brccej:v:5:y:2020:i:1:p:94-103
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    References listed on IDEAS

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    1. Cornett, Marcia Millon & Marcus, Alan J. & Tehranian, Hassan, 2008. "Corporate governance and pay-for-performance: The impact of earnings management," Journal of Financial Economics, Elsevier, vol. 87(2), pages 357-373, February.
    2. Uwalomwa Uwuigbe & Uwuigbe, Olubukunola Ranti & Okorie Bernard, 2015. "Assessment of the Effects of Firms Characteristics on Earnings Management of Listed Firms in Nigeria," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 5(2), pages 218-228, February.
    3. Mohammad M. Alhadab & Bassam Al-Own, 2017. "Earnings Management and Banks Performance: Evidence from Europe," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 7(4), pages 134-145, October.
    4. Roychowdhury, Sugata, 2006. "Earnings management through real activities manipulation," Journal of Accounting and Economics, Elsevier, vol. 42(3), pages 335-370, December.
    5. Uwalomwa Uwuigbe & Uwuigbe Olubukunola Ranti & Okorie Bernard, 2015. "Assessment of the Effects of Firms Characteristics on Earnings Management of Listed Firms in Nigeria," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 5(2), pages 218-228.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Earnings Management; Performance; Return on Asset; Earnings per Share; Operating Cash Flow; Firm Size;
    All these keywords.

    JEL classification:

    • P34 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Finance
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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