Corporate Governance and Quality of Financial Reporting on Food and Beverage Companies in Nigeria

Abstract

The focus of the study is to empirically examine the implications of Corporate Governance in financial reporting quality for Food and Beverage companies. The specific objectives are to identify the effect of board size, board independence and board expertise on financial reporting quality. This study employs a longitudinal research design. This design involves repeated observations of the same variables over long periods of time unlike the cross-sectional design which examines variables at a point in time. The sample for the study was eleven (11) companies in the Food and Beverage sectors. Secondary data used for this study was retrieved from corporate annual reports of the sampled companies from 2010 – 2017. The generalized least square regression analysis was used in the estimation of the models and in the determination of the causal relationship between the variables. The findings revealed that Board size (BSIZE) ,Board independence (BDIND) and  Board expertise (BDEXP)  all has negative effect negative on accrual based reporting manipulation and are statistically significant at 5% level. Thus corporate Governance is essential since it guarantee minimum level of assurance to the stakeholders, the study  recommend Corporate Governance should be taken very seriously since It influences how the objectives of the company are set and achieved, how risks are monitored and assessed and how performance is optimized by the shareholders.