Title:
EFFECT OF BOARD OF DIRECTORS’ ATTRIBUTES ON FINANCIAL INFORMATION QUALITY: EVIDENCE FROM NIGERIAN LISTED MANUFACTURING COMPANIES

Authors:
A.B. Mauda and Dr K. Ormin

Abstract:
This study examines the effect of board of directors’ attributes on the financial information quality of listed manufacturing companies in Nigeria for the period of six years (2011-2016). The sample of the study consists of 24 listed manufacturing companies from the population of 56 listed on the Nigerian stock exchange. The study employed multiple panel regression as a tool of analysis, using the longitudinal data extracted from the sampled companies’ audited financial statements. The study also extracted the residuals of Rowchowdhury (2006) model of real activities manipulation to determine financial information quality of the listed manufacturing companies in Nigeria. Board of directors’ attributes (inside directors, outside directors, gray directors, and women directors) was used as independent variables and real activity manipulation as dependent variable of the study. The results reveal that outside directors and gray directors has positive and significant effect on real activities manipulation practice by management of listed manufacturing companies in Nigeria whereas the variables of inside directors and women directors has positive but insignificant effect. The study recommends that the Securities and Exchange Commission and Nigerian Stock Exchange should make it mandatory that board of listed manufacturing companies should be dominated by outside and gray directors as they appear to be effective in deterring manipulative practices by management of companies’ therefore it provide high financial information quality in the Nigerian manufacturing sector