BOARD STRUCTURE, AUDIT COMMITTEE AND EARNINGS MANAGEMENT OF DEPOSIT MONEY BANKS IN NIGERIA
There is an increasing demand in the quality of earnings as this has become a key challenge for banks since the witness of financial scandals around the world. The financial scandals were blamed on pervasiveness of earnings manipulations by managers. Thus, this study examines the effect of board structure and audit committee on earnings management of listed Deposit Money Banks in Nigeria. Chang, Shen and Fang (2008) model was used to proxy earnings management, while women director, foreign director, board ownership, board size, board composition and audit committee represents board structure. Data were obtained from the annual reports and accounts of the 14 listed banks between 2006 and 2016. The study adopted Ordinary Least Square regression. The findings revealed that, women director and board size have significant negative effect on earnings management, while board ownership and audit committee were found to have significant but positive effect on earnings management of the banks. However, foreign director and board composition did not exert any significant effect on earnings management. The study recommends amongst others that the number of women director and board size be improved upon by the management, while percentage of shares held by directors and audit committee be reduced as this will ensure credibility and reliance in financial reports.