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CORPORATE GOVERNANCE MECHANISM AND STOCK PRICE PERFORMANCE: INSIGHTS FROM NIGERIA
Get PDFOver the years, firms from financial, real estate and construction sectors in Nigeria have been challenged heavily by corporate governance lapses. This seems to have affected major spheres of performance and specifically market stock price of the firms, thereby necessitating investigation into its level of influence. This study assessed how corporate governance practices affected listed businesses in Nigeria's firm performance. The study's goal is to assess the impact of board diversity, independence, size, and ownership on the stock price performance of a sample of Nigerian public companies. In order to achieve this, the study used secondary data, which was based on an ex post facto research strategy and used a pooled data set gathered from sixteen (16) quoted businesses during the period between the 2006 and 2019 financial period. Descriptive statistics, correlation matrices, and robust least squares regression analysis techniques were used to analyze the data that had been gathered. The Agency theory and entrenchment hypothesis served as the study's pillars. The results support the entrenchment hypothesis, which contends that large board ownership percentages have a negative impact on stock price performance. In particular, we discover that the stock price performance of listed companies in Nigeria throughout the study period was negatively impacted by the corporate governance variables of board size and board ownership, both of which are statistically significant at1%, 5%, and 10%. The entrenchment effect, which is already at work among our sample companies, leads us to urge, among other things, that consideration be given to the review of board ownership and size in light of the study's findings
EFFECT OF FINANCIAL LEVERAGE ON STOCK RETURNS OF LISTED COMPANIES IN NIGERIA CAPITAL MARKET
No full textThis study investigated the effect of financial leverage on stock returns of listed companies in Nigeria. The study population is listed companies in Nigeria capital market. The adjusted population is 103 companies. Monthly share prices and financial leverage from 2010 to 2018 were extracted from Bloomberg. Data were transformed to single period averages, and cross sectional regression and Z-test analysis were conducted. The outcome from the regression and z-test revealed that financial leverage has no significant relationship with stock returns. The outcome was consistent with Modiglianni and Miller theory. It was recommended that companies focus on investment strategies as opposed to financing strategies
IMPACT OF CAPITAL STRUCTURE ON FINANCIAL PERFORMANCE OF LISTED AGRICULTURAL COMPANIES IN NIGERIA
No full textA company is usually faced with the challenge of financing investments; the management is to decide on the optimal mix of capital structure decision. This study sets to investigate the influence that capital structure of a firm has on financial performance of listed manufacturing firms in Nigeria for period spanning from 2017-2021. The dependent variable of the study is financial performance proxy by return on asset (ROA) while the independent variable of the study is capital structure proxy by long-term debt, short term debt, total debt ratio and total equity ratio. The population of the study consist of all the 5 listed manufacturing firms in Nigeria and the sampling technique was the census arriving at a 25 firm year observations. The multiple regressions was employed for the data analysis and the study revealed that long-term debt ratio has a negative insignificant relationship with return on asset while short-term debt, total debt ratio and total equity ratio have positive significant influence on return on asset. The study recommends that the management of listed manufacturing firms in Nigeria should pay attention in curtailing long-term debt and improving on short term debts in order to improve financial performance
FINANCIAL PERFORMANCE OF BANKS IN SELECTED AFRICAN COUNTRIES: DOES INSTITUTIONAL QUALITY MATTER?
No full textThe importance of the banking sector to any nation's development cannot be overemphasized due to its ability to provide the loanable funds required for investment and capital formation. However, the decline in the financial performance of banks in Africa coupled with weak institutions prevalent in most countries in Africa have limited the banks' capacity to effectively stimulate economic prosperity. Hence, this study examined the effect of institutional quality on the financial performance of banks in selected African countries. The study population consisted of the 1017 banks operating in Africa from 2010 to 2020. Yamane formula and random cluster sampling was employed to select the top 200 banks in terms of assets, profits and size in Africa as at 2020. The study employed secondary data obtained from the Bank Focus database and the World Development Indicator. System Generalized Method of Moment was employed as the estimation technique. Findings revealed that institutional quality positively and significantly affects bank financial performance in selected African countries. Consequently, this study concluded that institutional quality is an important driver of bank financial performance. Thus, this study recommended that the selected countries' governments promote policies that would strengthen their nation's institutions because of their ability to further improve banks' financial performance
VALUE RELEVANCE OF INTERNATIONAL FINANCIAL REPORTING STANDARD FOUR OF LISTED NIGERIAN INSURANCE FIRMS
No full textThere is growing concern among regulators and investors over the depreciation in the value of listed insurance firms in Nigeria. The study examines the value relevance of the information content of IFRS 4: Insurance Contracts disclosure of listed insurance firms in Nigeria for the period 2012 to 2020. It further compares value relevance of accounting numbers, with high IFRS 4 disclosures and those with lower disclosures. The study adopted correlational research design. The population for the study consisted of all the 26 insurance firms listed on the Nigerian Stock Exchange as at 31st December 2020, with a sample size of 15 firms. The Ohlson Price Model was adopted for the study. Using robust ordinary least square regression, the study found IFRS 4 disclosures to be value relevant. Also, EPS of Insurance firms with high compliance with IFRS 4 is not more value relevant than that of firms with low compliance with IFRS 4, BVPS of Insurance firms with high compliance with IFRS 4 is more value relevant than that of firms with low compliance with IFRS 4. Overall, findings from the study strengthen the position that IFRS improves the quality of accounting information in annual reports. Furthermore, the study recommends among others that management of insurance firms should work towards improved compliance with IFRS 4 as this would boost investor confidence thereby improving their performance in the stock market
BOARD POWERS AND UNETHICAL ACCOUNTING OF PUBLIC QUOTED CORPORATIONS IN NIGERIA
Get PDFNumerous scandals have been committed globally due to excessive use of unethical accounting. Various research has been conducted on board activities and unethical accounting and their discoveries were assorted. None to the researchers’ awareness examined such association in an entire population of the registered public non-financial corporations in Nigeria for a period of 10 years (2010-2019). Secondary data was extracted from the annual reports and accounts, companies, and directors’ profile of the firms. The data was analyzed using Ordinary Least Square regression. The study found among other things that board power and its proxies except board capability have significant impact on the unethical accounting of listed firms in Nigeria. It is therefore, recommended that, the quoted firms in Nigeria should ensure the composition of all-encompassing and robust audit committees. They should also guarantee the presence of assorted gender, varied ethnic groups, directors with national honor and oversea directors on the boards. The organizations should ensure the formation of risk management committee in the entire corporations. The management should guarantee the existence of vastly skilled, experienced, and knowledgeable directors on the boards as these will aid in curbing the unethical accounting. The implication of the outcomes of this research to literature is that the discoveries of the research are to be utilized by researchers in confirming tokenism/critical mass theory, social capital theory. Also, to validate upper echelon theory, efficient contracting theory, resource dependency theory, signaling theory, human capital theory, behavioral theory of corporate boards and governance and agency theory. The discovery of the study is only applicable to listed organizations in Nigeria. The research utilized only six proxies of board power which is a limiting factor, and the result of the study might vary if other substitutions of board power are utilized. Moreover, the research did not capture the financial sector of Nigerian economy for the reason that the unethical accounting model utilized of Collins et al (2017) has elements which are only relevant to non-financial corporations. If other models of unethical accounting that can capture the financial industry are applied, the outcome of research may had been changed.
EFFECT OF CEO PAY AND CEO POWER ON RISK-TAKING OF LISTED DEPOSIT MONEY BANKS IN NIGERIA
No full textIt has been argued that increasing demand for high compensation by executives and powers in the hand of executives have contributed to increased risk-taking in the banking industry. The study aims to examine the effect of CEO Pay, CEO Ownership Power, and Expert Power on risk-taking of listed deposit money banks in Nigeria. A sample of 12 deposit money banks for the period 2009 – 2019 was studied and analysed using panel regression. The study found that CEO pay and CEO Expert power have no significant effect on risk-taking of listed deposit money banks in Nigeria. In contrast, CEO Ownership power was found to influence risk-taking significantly. The study recommends strengthening the influence of independent directors on the board to mitigate the influence of powerful CEOs
TRADE ORIENTED MONEY LAUNDERING AND ERA OF CYBERSECURITY TAX EVASION IN NIGERIA
No full textThis study examined at tax evasion also related trade-based money laundering mitigation strategies in Nigeria in the age of cyber security. Three objectives and research questions were designed to guide the study using a sample of 120 respondents. A survey research methodology was used for this study. The instrument used was a set of pre-coded, independently developed structured questionnaires. The study's analytical approaches included frequency distribution tables with percentages, bars, and charts, and logit regression was used to assess the objective. Since the majority of respondents (100%) are of working age based on the descriptive age group conclusion, they are qualified to understand how tax fraud and laundering of money affect economy growth. about educational achievement, it is implied that most of respondents has higher education standard than what the Cultural Organization, United Nations Educational and Scientific recommends for secondary school, which qualified them to provide an appropriate
response. This shows that, in terms of working experience, most of respondents have the fact and expertise necessary to comprehend the importance of laundering of money and tax evasion and in terms of economy growth. The findings indicated that among the duties of banks in recognizing cyber-scam were the development of the Bank Verification Number (BVN) and Single Treasury Account System,) and the instruction of collector of tax. In Nigeria's age of the cyber security, numerous measures have also been implemented to curtail and trade-oriented and tax evasion money laundering. According to logit regression, both laundering of money and tax evasion & were significant has indirect impact on economy growth. It follows, it is implied that both government revenue and economic growth are decreased as a result of large organizations' or individuals' tax avoidance. At a 5% level of significance, the logit regression outcome shows that tax collection (TAXC) was significant & positively connected with economy growth (ECOA). This means that 99.9% of the economic growth that the government funds through taxes is directly facilitated by the provision of infrastructure. For the amount of businesses that were registered, which was 5% and not statistical significant. This implied that the number of registered enterprises in the study area did not contribute enough to tax receipts to support economy growth. Tax evasion, its fact that it impacted on economy growth that was detrimental. Also, the findings indicated that Nigeria's economy growth would slow down as money laundering increased (MOLA). The marginal impact showed that laundering of money (MLA) was sensitive to economy growth at 99.9 percent and that it was statistically significant at 5 percent.
 
INDIRECT TAXES AND ECONOMIC GROWTH OF NIGERIA - THE REVENUE DIVERSIFICATION AGENDA
Get PDFAchieving sound economic growth is one of the major priorities of economic regulators. Nigeria economy majorly built on oil revenue in which unpredictability nature of the oil sector might adversely affected economic growth. Indirect taxes serve as the diversification means of generating revenue for an economy, but Nigeria economy has been characterized with challenges of high level of tax gap, mono-dependent oil revenue generation and weak tax system. These challenges have created problem of poor indirect tax revenue generation and deterioration in Nigeria economic growth rate. The objective of the study is to examine the effect of indirect taxes (VAT) and (CED) as economic revenue diversification on Nigeria economic growth in Nigeria. The study used expost facto research design with focused on RGDP, VAT, CED, interest rate and exchange rate in Nigeria within the period of 1995-2019. Autoregressive Distributed Lag (ARDL) method of analysis was employed, while unit root test was carried out among study variables and results shown that there were mixed levels of stationarity. Finding revealed that the short-run model indicated that CED, INT and EXR were major short-run determinants of Nigeria economic growth, while VAT was not short-run determinants of economic growth. Also, finding established that long run estimates established that, VAT, CED and INT show positive signs, indicating they influence RGDP positively while EXR has negative effect on GDP . The study concludes that both in the short and long runs VAT, CED, INT and EXR affect Nigeria economic growth. The study recommends that for an economy to achieve growth government should ensure that VAT, CED and INT are not highly charged on investors and consumers when buying products and services, acquiring raw materials from other countries, and seeking loan in the bank
CREDIT APPRAISAL, COLLECTION POLICY AND LOAN PERFORMANCE OF MICROFINANCE BANKS IN KWARA STATE, NIGERIA
No full textThe arrival of microfinance banks as another channel to mainstream the provision of financial services has become a major succour. Yet, the banks encountered high risk of default which is not unconnected with the peculiarities in its lending policies. In view of this, the study examines the effect of credit appraisal policy and credit collection policy on loan performance of MFBs in Kwara State, Nigeria. The study employed survey research design and the population consists of bank managerial and senior staffers from which one hundred and forty (140) were drawn conveniently as sample Data obtained through questionnaire were analyzed using descriptive and inferential statistics. The hypotheses for the study were tested using ordered logistic regression with average partial effects. The study found that collection policy significantly affects the loan performance of MFBs while credit appraisal policy does not significantly affect their loan performance as evidenced by their p-values. The study therefore concluded that collection policy influence loan performance of MFBs in Kwara State. Therefore, the study recommends that the credit appraisal policies should be restructure to capture the relevant information which will help these banks to determine the default intent of customers. Also, further monitoring mechanism should be put in place for bank loan collection policy in order that its effectiveness in increasing loan performance is improved