INTERNATIONAL JOURNAL OF ACCOUNTING, FINANCE AND TAXATION

FIRM ATTRIBUTES AND EARNINGS MANAGEMENT OF FIRMS IN NIGERIA

Justin Joseph Dawom

September 8, 2025

Citation

INTERNATIONAL JOURNAL OF ACCOUNTING, FINANCE AND TAXATION , Vol. 2 (2) (2025) , pp. 103-118

Details

ISSN: 3027-0378
Published: September 8, 2025
Status: Published

Abstract

The study assessed the effect of firm characteristics on earnings management of quoted oil and gas firms in Nigeria. To achieve the objectives of this study, the entire 12 oil and gas companies listed on the Nigerian Exchange Market were analyzed for the study.  The annual financial reports of the different firms for the period 2018 – 2023 were used for the study. In testing the research hypotheses, the study adopted the use of the Ordinary Least Square (OLS) regression model for the sampled listed firms. Findings from the study revealed that firm size and firm corporate strategy have non-significant impact on earnings management (which is represented by discretionary accruals). However, the findings also revealed that there is a significant relationship between financial leverage and discretionary accruals of the Nigerian firms considered in the sample. The study concludes that large firms tend to have higher incentives and more prospects in engaging in the manipulation of earnings and inflation earning figures due to the complexity of their operations and inherent intricacies for users to identify overstatement. However, the study recommends that potential investors should watch out for red flags associated with earnings management in small firms since small firms may likely indulge in earnings management as compared to larger firms since regulatory authorities don not beam their search light on them as compared to larger firm. 

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