Corporate Governance Attributes and Financial Reporting Quality of Nigerian Listed Firms: Pre and Post IFRS Regimes

ABSRACT
This study investigates the impact of corporate governance characteristics on financial reporting quality of companies listed on Nigerian Stock exchange in the pre and post IFRS adoption during 2010 – 2013.
In this study, to determine the treatment of discretionary accruals as financial reporting quality indicator, the original Jones Model (1991) has been applied. This study specifies a multiple regression model that puts financial reporting quality as a function of theoretically proven explanatory factors.
The study reveals that directors’ independence, board size and firm’s performance have significant impact on financial reporting quality in both pre and posts IFRS regimes in the Nigerian Listed Firms. The study also shows that gender diversity of directors and leverage had no significant negative impact on financial reporting quality in both regimes, while equity returns volatility had significant positive influence on financial reporting quality. From the study, it was revealed that there is a little decrease of 2% in the discretionary accruals and this indicates that there is a little increase in the quality of financial reporting after the adoption of IFRS in Nigeria. Although the conceptual basis and many of the general principles are quiet similar under IFRS and Nigerian IAS, the application of IFRS may be nevertheless significantly different and the adoption of IFRS may bring up many changes in terms of financial reporting by Listed Companies in Nigeria. Consequently, the differences between the two regimes may impact on the leeway provided by accounting standards to aid financial manipulation. This study recommends that there is need for Nigerian companies to increase their board size from a minimum of ten (10) to a maximum of twenty (20) as this may inject some level of dynamics into the board level interactions. Finally, the study recommends that all those personnel involved in companies financial reporting should be intensively trained to become certified accountants, and also the capacity to prepare and present financial statements conforming to accounting standard need to be exploited other than being kept idle by Listed companies in Nigeria.