AUDIT COMMITTEE ATTRIBUTES AND EARNINGS QUALITY: EVIDENCE FROM LISTED FINANCIAL SERVICES FIRMS IN NIGERIA
DOI:
https://doi.org/10.37231/apj.2024.7.2.626Abstract
Abstract: Information on earnings is an important earnings quality metric in financial reporting. Poor disclosure of such information could lead to poor information asymmetry, which often triggers negative reactions from the market and stakeholders. Therefore, this study investigates the relationship between audit committee attributes and earnings quality among listed financial services firms in Nigeria. The study conducts robust regression analysis with 11-year panel data for 41 listed firms. Our findings reveal the effect of audit committee attributes on earnings quality. In specific terms, the findings of the study reveal that audit committee independence, audit committee accounting expertise, the expertise of women on the audit committee, and the audit committee meetings improve earnings quality. The findings of the study confirm the code of corporate governance in Nigeria and agency theory postulations. The study makes some appreciable contributions to the literature by examining gender diversity beyond women’s inclusion on the committee to include expertise, examining audit committee independence from the point of view of the representatives of the shareholders, and earnings quality from a long-term sustainable point of view.
Keywords: Audit Committee Independence; Audit Committee Size; Earnings Predictability; Earnings Smoothen; Shareholders’ Representatives
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