AUDIT COMMITTEE’S ATTRIBUTES AND QUALITY OF FINANCIAL REPORTING ON LISTED CONSUMER GOODS FIRMS IN NIGERIA

Abstract

Confidence of the community in general and the investment community in particular in the
accuracy of the Nigerian companies' financial reports has decreased due to the repeated
documentation of accounting manipulations in financial statements. This has led to business
takeovers and collapse. The prevalence of takeovers and or collapse has caused significant
concern about how well corporate governance procedures guarantee the preparation and
disclosure of more effective accounting records. Therefore, this study examined the effects of audit
committees’ attributes on the quality of financial reporting of listed consumer goods firms in
Nigeria. The data for the study was obtained from the annual reports of the sample of sixteen
consumer goods firms listed for the period 2009 to 2022. The data was analyzed using fixed effect
regression analysis after conducting the Hausman test and the Breusch-Pagan test. The study
found that audit committees independence (ACI), audit committees’ size (ACS), and shareholders
involvement in the committees (SIAC) have a considerable tendency to enhance the standard of
published financial information of Nigerian consumer goods businesses that are listed. The study
concluded that the audit committee affects the quality of the financial statements of listed consumer
goods companies in Nigeria. To maintain an effective oversight function and foster a positive
environment for the legally required audit that promotes a reliable and unbiased perspective of
the financial information, this study proposed that the governing board of executives guarantee
the nomination of appropriate audit committee members who have adequate financial skills,
including shareholders.