Influence of Corporate Governance Practices on Quality of Financial Reporting in the Nigerian Public Sector
DOI:
https://doi.org/10.47672/ajacc.1381Keywords:
Corporate governance, financial service, public institutions, complianceAbstract
Purpose: This study assessed the influence of corporate governance (CG) practices on quality of financial reporting (QFR) in public sector institutions in Nigeria.
Methodology: Descriptive research design and survey method was used to collect data from a total of two hundred and ten (210) senior level officers from finance and accounts, internal audit and senior management staffs from related departments of ten (10) public sector entities were sampled and selected using Multi-Stage sampling method. Relevant information was elicited from selected personnel using structured questionnaire. Data analysis involved descriptive and inferential statistics using Stata. In determining the relationship between corporate governance and quality financial reporting (QFR), some principles of good governance as listed by Organization of Economic Corporation and Development (OECD) were regressed against the characteristics of quality financial reporting as identify in the accounting framework.
Findings: It was discovered that some of the corporate governance principles like compliance with regulations, fairness, effective risk management, good internal auditing and ownership inclusiveness do positively and significantly influence quality of financial reporting. Characteristics like officer responsibility, openness and responsiveness shows weak influence. Gender and other demographic characteristics also have weak effect on QFR. Even the level of awareness of application of corporate governance principles to public sector is low and this affects compliance.
Recommendation: The study recommend creation of better awareness and compliance with CG principles will help to improve quality of financial reporting in the public sector.
Downloads
References
Agyei-Mensah (2017), “Impact of Corporate Governance Attributes and Financial Reporting Lag on Corporate Financial Performance,” African Journal of Economic and Management Studies Vol 9. (3) pp 349–66, https://doi.org/10.1108/AJEMS-08-2017-0205
AL-Shatnawi H.M. (2019) “Measuring the Quality of the Interim Financial Reports Using the Qualitative Characteristics of the Accounting Information and Its Effect on the Investment Decisions According to the ‘IAS 34,’” International Journal of Economics and Finance Vol.9 (5) pp.159, https://doi.org/10.5539/ijef.v9n5p159.
FRCN (2018) Adoption and Compliance with Nigerian Code of Corporate Governance.
G20/OECD (2016) Principles of Corporate Governance, G20/OECD Principles of Corporate Governance, https://doi.org/10.1787/9789264257443-tr
Goel P (2018) Implications of Corporate Governance on Financial Performance: An Analytical Review of Governance and Social Reporting Reforms in India,” Asian Journal of Sustainability and Social Responsibility, https://doi.org/10.1186/s41180-018-0020-4
IFAC (2012) Integrating Governance for Sustainable Success: How Professional Accountants Integrate Governance into Their Organizations’ Drivers of Sustainable Success.
Kemei F.K. & Mweberi E. (2017) “Effect of Corporate Governance Practices on Financial Management in Non-Governmental Organization, Kenya,” International Journal of Economics, Commerce and Management United Kingdom V, no. 4. Pp.599–615, http://ijecm.co.uk/.
Kachouri M & A. Jarboui (2017), “Exploring the Relation between Corporate Reporting and Corporate Governance Effectiveness,” Journal of Financial Reporting and Accounting, https://doi.org/10.1108/jfra-06-2016-0053.
Khalid M. A, Alam M.M & Said J (2016) “Empirical Assessment of Good Governance in the Public Sector of Malaysia,” Economics and Sociology Vol.9 (4) pp289–304, https://doi.org/10.14254/2071-789X.2016/9-4/18.
Kiranmai J &Mishra R.K (2021) Recent Advances in Corporate Governance: A Global view. Open Access Peer Review Chapter; Intech Open. Doi:10.5772/intechopen.100135
Koech P. G. S. Namusong G.S. & Mugambi F.M (2016) “" Board Characteristics as A Determinant of Effectiveness of Corporate Governance in State Corporation in Kenya ".,” International Journal of Business and Commerce Vol 5 (4) pp 37–62.
Kontogeorgis G (2018). The Role of Internal Audit Function on Corporate Governance and Management, International Journal of Accounting and Financial Reporting, Vol 8 (4) pp 100-114 https://doi.org/10.5296/ijafr.v8i4.13626
Marshall J.B. (2020) The Impact of Globalisation on Corporate Governance practices in Nigeria: An Assessment. International Journal of innovative legal and Political Studies Vol 8(4) pp106-119
Mashavave M. (2017) “A Corporate Governance Perspective to State Owned Enterprises in Zimbabwe: A Case Study of Air Zimbabwe,” Management, 7(6), pp209–222, https://doi.org/10.5923/j.mm.20170706.04
Nakpodia F, Adegbite E AmaeshI K &Owolabi A.(2018).Neither Principles nor Rules; Making Corporate Governance work in Sub Sahara Africa. Journal of Business Ethics 151(2):391-408 B. K.
Osadchy E.A (2018) “Financial Statements of a Company as an Information Base for Decision-Making in a Transforming Economy,” European Research Studies Journal, https://doi.org/10.35808/ersj/1006.
Patrick V. (2021). The link between corporate governance and corporate financial misconduct. A review of archival studies and implications for future research Corporate Ownership and Control •Vol.14 (4)
Prasad V. H. & James K. (2018) Good Corporate Governance; Evidence from Fijian Listed Entities, International Journal of Finance, https://doi.org/10.5923/j.ijfa.20180703.03
Rughoobur S. (2018) “An Assessment of Good Corporate Governance in State Owned Enterprises of Mauritius,” Studies in Business and Economics,13no.1 pp166-180 https://doi.org/10.2478/sbe-2018-0013.
Stafford A. & Stapleton P (2017) “Examining the Use of Corporate Governance Mechanisms in Public–Private Partnerships: Why Do They Not Deliver Public Accountability?” Australian Journal of Public Administration Vol. 76 (3) pp 378–91, https://doi.org/10.1111/1467-8500.12237.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2023 Omimakinde John Akintayo, Adejuwon Joshua A
This work is licensed under a Creative Commons Attribution 4.0 International License.
Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution (CC-BY) 4.0 License that allows others to share the work with an acknowledgment of the work’s authorship and initial publication in this journal.
