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Assessing Audit Committee Effectiveness on Real Earnings Management of Listed Non-Financial Firms in Nigeria

Author

Listed:
  • Ahmad Muhammad Ahmad

    (Department of Accounting)

  • Inyada Sunday

    (Department of Accounting)

Abstract

The study is aimed at investigating the potential impact of audit commi?ee in the financial performance of listed non-financial firms in Nigeria for a period of 10years spanning 2011- 202. The dependent variable of the study is real earnings management proxy Srivastava (2019) revised model while the independent variable of the study is audit commi?ee proxy by audit commi?ee independence, audit commi?ee size, audit commi?ee diversity and audit commi?ee meetings. The study arrived at 760 firm year observations from a population of 113 listed non-financial companies in Nigeria; the extracted secondary data was analysed using PCSE and the results revealed that audit commi?ee independence audit commi?ee size and audit commi?ee meetings have no significant impact on real earnings management while only audit commi?ee diversity among all the variables showed a significant positive impact on real earnings management of listed non-financial firms in Nigeria. The study recommends that the number of members in the audit commi?ee should be increased by the relevant authority and the percentage of women in the composition in the audit commi?ee should also be increased as this will help in reducing earnings management and improve the efficiency of the commi?ee.

Suggested Citation

  • Ahmad Muhammad Ahmad & Inyada Sunday, 2023. "Assessing Audit Committee Effectiveness on Real Earnings Management of Listed Non-Financial Firms in Nigeria," Multidisciplinary Journal of Social Sciences, Association of Forensic Accounting Researchers (AFAR), vol. 3(1), pages 181-196, June.
    • Handle: RePEc:ris:amjoss:0009
    as

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    References listed on IDEAS

    as
    1. Roychowdhury, Sugata, 2006. "Earnings management through real activities manipulation," Journal of Accounting and Economics, Elsevier, vol. 42(3), pages 335-370, December.
    2. Naila Tabassum & Ahmad Kaleem & Mian Sajid Nazir, 2014. "Earnings management through overproduction and subsequent performance: an empirical study in Pakistan," International Journal of Indian Culture and Business Management, Inderscience Enterprises Ltd, vol. 9(3), pages 267-282.
    3. Anup Srivastava, 2019. "Improving the measures of real earnings management," Review of Accounting Studies, Springer, vol. 24(4), pages 1277-1316, December.
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