International Journal of Accounting, Management, and Economic Review
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LEVERAGE AND TAX STRATEGIES: AN EMPIRICAL STUDY IN THE CONTEXT OF THIN CAPITALIZATION RULES
Get PDFIn this research, we are examining the effect of leverage, thin capitalization and their relationship with corporate income taxes in a panel database of multinational enterprises over an eight years period (2015-2023). Thinly capitalized firms will be identified through their Debt-to-Equity ratio, which indicates the amount of debt vs. equity used to finance the firm. The leverage of the firm will be identified through Total liabilities divided by Total Assets. The greatest contribution of the current research study to the existing body of knowledge is the use of pooled Ordinary Least Squares Analysis with Heteroskedasticity Consistent Standard Errors in the analysis of Debt-related Tax incentives and the three dependent variables of Tax base Proxy, Net Income and ETR (Effective Tax Rate). Empirical results of this analysis indicate that thinly capitalized firms with low leverage have lower values for the Tax base Proxy and Net Income than firms that are heavily leveraged. However, it was found that the relationship between ETR and thinly capitalized firms is weak and highly dependent on the specific specification of the model. The results of this research are consistent with the existing literature on Debt-related Tax Incentives as it relates to Thin Capitalization, however, this study provides further evidence of the negative effects on profitability due to excessive use of Debt Financing and expands the current body of knowledge regarding thin capitalization with accounting-based proxies. The study does recognize limitations in measuring the available proxies and the differences between tax regimes in different jurisdictions
INTERNALLY GENERATED REVENUE AND FOREIGN DEBT: EVIDENCE FROM NIGERIA’S NORTH CENTRAL STATES (2010-2023)
Get PDFThe issue of Debt sustainability has brought several debates and reactions by stakeholders in accounting literature. There have been mixed results as to either financing operations of the states by debt or not and this remains inconclusive thereby motivating this paper. Sustaining the high debt profile of North Central states has become worrisome that needs urgent attention. The study therefore investigated the effect of Internally Generated Revenue (IGR) on debt sustainability in Nigeria with special focus on the North Central States. Ex-post facto research design was adopted. The population of the study was 6 States in the North central, Nigeria which also constitute the sample of the study. Data covering a period of 14 years (2010-2023) were extracted from audited accounts of the States. The reliability of the data was premised on the Nigerian regulatory and legal framework. Descriptive and inferential statistics were used to analyze the data at 0.05 level of significance. From the post estimation tests the regression results suggested the Fixed effect with Driscoll-Kraay SE. Findings reveal that internally generated revenue measured with PAYE and ORS having a significant effect on size of foreign debt (Adj R2 = 0.719, F (4, 79) = 75.62, p < 0.005). The study concluded that internally generated revenue impacted debt sustainability of North Central States in Nigeria especially on the size of foreign debt. The study recommends that the government of the states in North Central Nigeria should prioritize policies aimed at diversifying revenue streams by investing in sectors that encourage economic growth and generate substantial internally generated revenue (IGR)
AUDIT QUALITY AS A MODERATOR OF CORPORATE GOVERNANCE RISKS AND MARKET VALUE: EVIDENCE FROM NIGERIA’S QUOTED DEPOSIT MONEY BANKS
Get PDFThe study objective is to examine the moderating effect of audit quality (AQ) and corporate governance risks management on market value of quoted deposit money banks (DMBs) in Nigeria for period of 2018 to 2023 of the Nigeria code of corporate governance implementation. The study used a sample of the Twelve (12) quoted banks out of the population of Fourteen (14) using purposive sampling technique. Longitudinal research design was adopted and secondary data were analyzed through Panel regression model. The study results with R-square of 89% revealed positive significant effect of board size, Board independence, Agency accounting mitigating factor and (AQ) on market value measured in the modified Tobin-Q of DMBs but the variables were also significant when they were moderated with (AQ); but management report lag was positively insignificant. The study concluded that audit quality has strong moderating effect on risks management and market value and accounting monetary benefits alignment is the major factor that reduces conflicts of interest (risks) to maximize shareholders wealth. Also, a proportionate increase in board size to the assets of banks and increase in number of non-executive directors reduce corporate governance risks thereby increase market value of quoted DMBs. It is recommended that government through the CBN and FRCN mechanism should make policies to promote audit firm’s merger, specialization and reserve certain sensitive industry to certain size of audit firms to audit. Also, the minimum number of non-executive directors in DMBs board should be pecked at 75% proportion and benefits alignment ratio between management team and shareholders should be pecked at range of 60% to 40% respectively
EFFECT OF PROFITABILITY AND FIRM GROWTH ON FINANCIAL REPORTING QUALITY OF LISTED INDUSTRIAL GOODS FIRMS IN NIGERIA
Get PDFThe objective of this study is to investigate the effect of profitability and firm growth on financial reporting quality of listed industrial goods firms in Nigeria. Given the distinctive challenges characterizing the industrial goods sector such as high capital intensity, cyclical demand patterns and exposure to economic fluctuations, it is essential to examine how these factors influence the relationship between firm performance metrics like profitability and growth on financial reporting quality in this sector. A sample of 9 industrial goods firms were selected from the population of 13 firms listed on the Nigerian Exchange Group (NGX). Data was collected through secondary sources from annual reports of the companies from 2014- 2023. The study adopted the ex-post factor research designs and employed the use of generalized least squares regression as a tool for data analysis. The effect of corporate attributes on financial reporting quality was measured using the residuals from the modified Jones model by Dechow, Sloan and Sweeney (1995). The results showed a positive significant effect of profitability on discretionary accruals proxied by financial reporting quality (FRQ). For firm growth, a negative but significant effect on discretionary accruals was reported. Based on the findings, it is recommended that managers of industrial goods firms may choose to pursue firm growth strategies, through diversifying product lines and strengthening distribution channels, as it has been found empirically to enhance the quality of the firms’ reporting. Regulators such as Central Bank of Nigeria (CBN), Securities and Exchange Commission (SEC) and Financial Reporting Council of Nigeria (FRCN) should monitor compliance with firms’ disclosure requirements, and impose strict penalties for violations especially in areas of financial misreporting to deter unethical reporting practices
EMPLOYEE INVOLVEMENT IN DECISION MAKING AND THEIR CONTRIBUTIONS TOWARDS EMPLOYEES’ PRODUCTIVITY; EVIDENCE FROM CEMENT FIRMS FCT METROPOLIS
Get PDFThe purpose of this research was to examine the contribution of employees’ participation in decision making on employee productivity in cement firms, FCT metropolis. Research was conducted using a survey methodology. The study\u27s sample size was 202 people drawn from certain organisations. Regression analysis was used to assess the strength of association between the independent and dependent variables. SPSS was furthermore used to check the study\u27s assumptions. The results showed a positive relationship between employee productivity and management that encouraged input from all team members. The results suggested that participative management had the potential to increase productivity by helping employees better understand their roles within the organisation. The research concluded that businesses would benefit from more employee participation in decision-making if they did so in order to achieve their goals more rapidly and enhance their revenues
EXAMINING THE MODERATING EFFECT OF INDUSTRY TYPE ON THE RELATIONSHIP BETWEEN BOARD BUSYNESS AND CORPORATE SUSTAINABILITY REPORTING: EVIDENCE FROM NIGERIAN LISTED FIRMS
Get PDFThis study examines the impact of industry type on the relationship between busy board and corporate sustainability reporting. The study adopts quantitative research design using a panel data approach and data were collected from annual reports of 94 companies listed on the Nigerian Exchange Group (NGX) for the period of seven years (2016 to 2022). Panel corrected standard error (PCSE) was used to analyze the data. The results shows that there is no significant relationship between busy board and corporate sustainability reporting. However, the findings shows that there is positive significant relationship between industry type and corporate sustainability reporting. Furthermore, it was found that, industry type significantly influences the relationship between busy board and corporate sustainability reporting. The study recommends that, companies should regularly reassess their board composition to ensure alignment with sustainability objectives, prioritizing the appointment of directors with relevant expertise and a commitment to sustainability, despite the study\u27s finding of a negative and insignificant relationship between busy boards and sustainability reporting. Similarly, regulatory agencies should develop tailored reporting standards that consider industry-specific challenges and opportunities
MARKET RISK AND FINANCIAL PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA
Get PDFThis study examines how market risk components interest rate risk, exchange rate risk, and political risk affect the financial performance of Nigerian deposit money banks over the period 2010–2024. Using random effect robust regression on panel data from fifteen banks, the analysis reveals that interest rate risk exerts a positive and significant effect on return on assets (coefficient = 0.286, p < 0.01), indicating that a one percentage point increase in interest rate volatility raises bank profitability by approximately 0.29%. Similarly, exchange rate risk demonstrates a positive and significant relationship with financial performance (coefficient = 0.341, p < 0.05), suggesting effective foreign exchange risk management and profitable international transactions. Conversely, political risk exhibits a negative and significant effect on return on assets (coefficient = -0.512, p < 0.01), with heightened political uncertainty reducing bank profitability by 0.51% for each unit increase in the political risk index. These findings are consistent with efficient market hypothesis predictions in stable risk environments but underscore the vulnerability of banking operations to governance instability. The study recommends that monetary authorities maintain accommodative interest rate policies that balance macroeconomic stability with banking sector profitability, while banks should strengthen political risk hedging through geographic diversification and enhanced stakeholder engagement with policymakers to mitigate regulatory and operational disruptions
BOARD INDEPENDENCE, BOARD CAPACITY, AUDIT COMMITTEE EXPERTISE, AND SUSTAINABILITY REPORTING OF LISTED OIL AND GAS FIRMS IN NIGERIA
Get PDFDrawing on agency theory and legitimacy theory perspectives, the purpose of this paper is to investigate theeffectofgovernancefactorsonthe sustainability reporting of Nigerian traded oil and gas firms. The study employed ex-post-factor research design. The population for the study consisted of all ten (10) listedoiland gas firms on the Nigerian Exchange Group (NGX) as at 31 December, 2024. The collected data were analysed using multiple regression analysis. Diagnostic tests such as Multicollinearity, and Heteroskedasticity in order to enhance the reliability of the regression results. The regression model was statistically significant (F = 3.93, p = 0.014) with an R² of 0.2042, indicating that the governance factors explain approximately 20.4% of the variation in sustainability reporting. Board independence (β = 0.3698, p = 0.011) and board capacity (β = 0.0835, p = 0.042) showed positive significant effects, while audit committee expertise (β = -0.6441, p = 0.011) demonstrated a negative significant influence. It is recommended that Nigerian-listed oil and gas companies continue strengthening board independence by adding more independent directors, as their presence improves transparency and positively impacts sustainability reporting.This study contributes to the literature by providing empirical evidence on the governance-sustainability reporting nexus, specifically within Nigeria\u27s oil and gas sector, addressing a significant research gap in emerging market contexts where sustainability practices remain inconsistent and poorly enforced
SHADOW BANKING AND MARKET-BASED FINANCING IN NIGERIA
Get PDFThis study examines the effect of various shadow banking on market-based financing (MBF) in Nigeria. The research focuses on five key variables: securitization intermediation, credit intermediation, assets-liabilities mismatch, leverage, and shadow banking index. Using a sample of 4 sectors of the non-banking financial institutions in Nigeria for the period 2018 to 2023, the study applies fixed-effect panel least squares regression analysis to assess the relationships between these variables and MBF. The findings reveal that securitization intermediation does not have a statistically significant effect on MBF. Credit intermediation, assets-liabilities mismatch, and shadow banking have statistically significant positive effects on MBF. However, leverage no statistically significant effect on MBF in Nigeria. Based on these findings, the study recommends that policymakers focus on enhancing the regulatory framework for securitization and leverage, while supporting shadow banking entities to bridge the credit gap left by traditional banks, particularly for underserved sectors in Nigeria The study underscores the significant role of credit intermediation, assets-liabilities mismatch, and shadow banking in promoting market-based financing in Nigeria, while highlighting the need for targeted regulatory measures to address the limitations of securitization and leverage practices. The findings emphasize the importance of strengthening regulatory frameworks to optimize the benefits of these financial mechanisms and ensure sustainable market-based financing in the Nigerian economy
EVALUATION OFTHE EFFECT OF EXAMINATION MALPRACTICE ON EDUCATIONAL DEVELOPMENT IN THE DEPARTMENT OF PUBLICADMINISTRATION KADUNA POLYTECHNIC, KADUNA
Get PDFThe paper is titled the evaluation of the effect of examination malpractices on educational development in the department of Public Administration, Kaduna polytechnic. Examination malpractice is any wrong doing a student or candidate will exhibit before, during or after any examination. The impact of this act is so grave and has seriously affected the quality of graduates from our higher institutions of learning in the country. Any form of examination malpractice is unacceptable, fraudulent, and signifies an act of academic dishonesty with significant punitive consequences. This study investigated the effect of examination malpractice in the department of public administration Kaduna Polytechnic. The objectives of this study includes; to identify the factors responsible for students‟ involvement in examination malpractice; unravel the various forms of examination malpractice, Kaduna polytechnic; and to ascertain the consequences of examination malpractice in the department of Public Administration, Kaduna polytechnic. The study adopted a survey design for this research and targeted students and lecturers as well as examination malpractice committee of the institution. Simple random sampling technique was used to select 142 out of a total student’s population of 1467 for the study. They responded mainly to questionnaire and a few open ended questions to provide the needed data for analysis. The findings suggest that (i) smuggling of prepared notes on pieces of papers (foreign material) into the examination hall,(ii) writing of examination answers on palms, thighs and other body parts, and (iii) communication by seeking for answers from colleagues are the three topmost forms/methods students engage to cheat during examinations. The desire to obtain good grades just as the more intelligent students pushes some students to cheat during examinations. The introduction of scanners and e-search software, the spacing of sitting arrangements, installation of Closed Circuit Television (CCTV) The study provided certain recommendations to curb the challenges of examination malpractice in the study area. All material consulted in this paper were duly acknowledged in the references