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

Author

Listed:
  • 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)

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.

Suggested Citation

  • Fodio Inuwa MUSA & Foluke Omolayo OLORUNTOBA & Victor Chiedu OBA, 2014. "Examination of the relationship between audit committee characteristics and financial reporting quality of Nigerian deposit banks," EuroEconomica, Danubius University of Galati, issue 1(33), pages 57-65, May.
    • Handle: RePEc:dug:journl:y:2014:i:1:p:57-65
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    File URL: http://journals.univ-danubius.ro/index.php/euroeconomica/article/view/2153/2496
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    References listed on IDEAS

    as
    1. Musa Mangena & Richard Pike, 2005. "The effect of audit committee shareholding, financial expertise and size on interim financial disclosures," Accounting and Business Research, Taylor & Francis Journals, vol. 35(4), pages 327-349.
    2. R.M. Haniffa & T. E. Cooke, 2002. "Culture, Corporate Governance and Disclosure in Malaysian Corporations," Abacus, Accounting Foundation, University of Sydney, vol. 38(3), pages 317-349, October.
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    Cited by:

    1. Adegboye Kehinde Adewale & Maryam Isyaku Muhammad & Bilyaminu Yusuf Hanga, 2019. "Effect of Firm Attributes on Financial Reporting Quality: Evidence from Listed Consumer Goods Companies in Nigeria," Indian Journal of Commerce and Management Studies, Educational Research Multimedia & Publications,India, vol. 10(1), pages 55-64, January.
    2. Samuel Akpovwre Eyenubo & Mudzamir Mohamed & Mohammad Ali, 2017. "An Empirical Analysis on the Financial Reporting Quality of the Quoted Firms in Nigeria: Does Audit Committee Size Matter?," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 7(9), pages 50-63, September.
    3. Olusola David Fajembola & Nora Azureen Abdul Rahman & Rohani Md-Rus, 2018. "Audit Committee and Banking System Stability: A Conceptual Framework," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 8(6), pages 463-474, June.

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