Effect of firm size and firm profitability on earning management among listed firms on Nigeria Exchange Group

Segun Idowu Adeniyi

doi:10.29358/sceco.v0i40.581

Authors

Segun Idowu Adeniyi Nnamdi Azikiwe University, Awka.

DOI:

https://doi.org/10.29358/sceco.v0i40.581

Keywords:

earning management; accrual-based earnings management; real earnings management; firm size; firm profitability

Abstract

The main objective of the study is to evaluate the effect of firm size and firm profitability on earning management among listed firms on Nigeria Exchange Group. This study specifically seeks to ascertain the effect of firm size and firm profitability on both accrual-based earnings management and real earnings management activities. The study focused on non-financial listed firms on Nigeria Exchange Group for the period of 2013 to 2023. The study adopted ex post facto research design and purposive sampling was used to select sample population. Secondary source of data was extracted from financial reports and accounts of sample firms from either companies’ corporate web site or Nigeria Exchange Group Factbooks. This study found that firm size and firm profitability affects both discretionary accruals management and real earnings management. the study recommends among others that since profitable firms tend to engage in both discretionary accruals management and real earnings management. Though profitability showed management’s ability to generate profit, financial regulators should encourage them to improve their financial reporting quality and reduce earning management practice.

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Author Biography

Segun Idowu Adeniyi, Nnamdi Azikiwe University, Awka.

Name: Segun Idowu Adeniyi PhD

Rank: Senior Lecturer

Department of Accountancy,

Faculty of Management Sciences,

Nnamdi Azikiwe University,

Awka,

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