Determinants of Financial Reporting Quality of Listed Deposit Money Banks in Nigeria

Financial reporting quality (FRQ) is central to corporate governance, transparency, and investor confidence, particularly in emerging markets. This study examines the impact of audit committee independence, audit committee meeting frequency, audit committee financial expertise, audit committee gender diversity, and audit committee tenure as determinants of FRQ of Nigerian listed deposit money banks between 2010 and 2024. The population comprises 14 listed deposit money banks on the Nigerian Exchange Group, of which 12 banks were purposively sampled due to data availability. Drawing on agency theory, which highlights conflicts of interest between shareholders and management, the study posits that effective audit committees mitigate opportunistic managerial behavior, such as earnings manipulation, thereby enhancing reporting integrity. Using panel data from the sampled banks and employing Panel-Corrected Standard Errors (PCSE) regression analysis, the study finds that audit committee independence and meeting frequency positively and significantly influence FRQ, while gender diversity and prolonged tenure exhibit negative effects. Financial expertise shows a positive but statistically insignificant effect. The findings underscore the critical role of audit committee design in strengthening oversight and safeguarding financial transparency. Practically, the study informs regulators and bank management on governance mechanisms that optimize reporting quality, while theoretically extending agency theory to the context of Nigerian financial institutions.

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