Abstract

BOARD CHARACTERISTICS AND REAL ACTIVITY MANIPULATION (RAM) OF LISTED NIGERIAN CONGLOMERATE FIRMS

Abdullahi Hassan Gorondutse, Halliru Ishaq, SalimonMaruf Gbadebo

Volume: 8 Issue: 4 2018

Abstract:

This work is an examination of how characteristics of Board of Directors affect real activity manipulation of Nigerianlisted Conglomerate firms for eleven years period (2006-2016). The study employed multiple regressions as a method of data analysis obtained from listed Nigerian conglomerate firms annual reports and accounts using residuals of Roychowdhury (2006) to determine Real Activities Manipulation. Board of Directors characteristics were used as the independent variables of the study where Real activity Manipulation (RAM) was used as dependent. It was revealed from the findings that, the characteristics of board of directors’, predominantlygrey and women directors were having significant effect in check-mating the dysfunctional attitude of managers in the listed Nigerian conglomerate firms but Executive and Non-executive directors proved to have less effect in restraining mangers from their opportunistic behavior in the Nigerian listed conglomerate firms. Therefore, the study recommends that listed Nigerian conglomerate firms should increase the number of grey and women directors in the committee as they are found to be highly effective in restraining managers from opportunistic behavior that leads to managements of earning in Nigerian listed conglomerate firms.

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