OWNERSHIP STRUCTURE MECHANISMS AND REPORTED EARNINGS QUALITY: EVIDENCE FROM QUOTED CONSUMER-GOODS FIRMS IN NIGERIA

This study investigates the effect of ownership structure on the earnings quality of listed consumer goods firms in Nigeria from 2012 to 2024. Earnings quality is a central issue in corporate reporting because it influences stakeholders’ decision-making and reflects the credibility of financial statements. Ownership structure is widely regarded as an important corporate governance mechanism that can mitigate opportunistic earnings manipulation. The study formulated four hypotheses to examine the influence of managerial ownership, institutional ownership, ownership concentration, and foreign ownership on earnings quality. Using the Modified Jones Model to measure earnings quality, secondary data were extracted from the annual reports of 22 consumer goods firms listed on the Nigerian Stock Exchange. Panel regression analysis was used to estimate the relationships among the variables. The results show that managerial ownership has a positive and significant effect on earnings quality, implying that managers with equity stakes are more committed to transparent and responsible financial reporting. Ownership concentration, on the other hand, exhibits a significant negative impact, suggesting that high control by a few shareholders may promote earnings manipulation. Institutional and foreign ownership both showed positive but statistically insignificant effects, indicating limited influence on earnings quality within the study period. The study concludes that ownership structure is a key determinant of earnings quality in Nigeria’s consumer goods sector. It recommends enhancing managerial shareholding to improve financial reporting credibility while discouraging excessive ownership concentration.

0 19 Dec, 2025

pg: 22

JBMIC PORTAL SYSTEM

Contri. 3+