EFFECT OF GOVERNANCE MECHANISMS ON MANIPULATIVE ACCOUNTING OF LISTED INDUSTRIAL GOODS FIRMS IN NIGERIA

Abstract

Corporate governance plays a critical role in enhancing financial reporting quality by promoting transparency, accountability, and ethical managerial practices in corporate organizations. This study examines the effect of governance mechanisms on manipulative accounting of listed industrial goods firms in Nigeria. Ex-post factor was used as the research design for the study while positivism was used as the philosophical view of the study. The adjusted population of the study comprises of the thirteen (13) listed industrial goods firms in the Nigerian Exchange Group as at 31st December, 2024. The adjusted population was obtained after using purposive filter as the sampling technique. The accounting econometric data was obtained from the annual financial reports and accounts of the listed industrial goods firms for the period of ten (10) years spanning from 2015 to 2024. Pooled Ordinary Least Square (OLS) regression was used as the technique for data analysis. The findings from the study revealed that board independence and board size have positive significant effect on manipulative accounting of listed industrial goods firms in Nigeria. On the other hand, board meeting and board gender diversity have insignificant effect on manipulative accounting of listed industrial goods firms in Nigeria. It is recommended therefore, that the nomination committee of the board of directors of listed industrial goods firms should ensure gender equality in the composition of the board members by nominating female directors into the firms’ board of directors. This is based on the fact that female are usually considered to be more conservative when it comes to financial matters. Hence, could have more oversight power than their male counterparts in dealing with manipulative accounting tendencies by the management.