AUDIT COMMITTEE CHARACTERISTICS AND FINANCIAL REPORTING QUALITY OF CONSUMER GOODS FIRMS IN NIGERIA

The study examines the effect of audit committee characteristics on financial reporting quality of listed food and beverage firms a sub- sector of consumer goods sector in Nigeria. The study adopts experimental research design using panel data of six years (2012 to 2017). Data were collected from the Nigerian Stock Exchange. The study has a population size of seventeen (17) listed food and beverage firms in Nigeria. Eight (8) firms were selected as sample size after a filtering process. The study used modified Kothari, Leone and Wasley (2005) model to measure level of earnings quality, a proxy for financial reporting quality. The data were analyzed using panel data regression with aid of computer software (STAT A). The study found that audit committee size, frequency of meeting, financial expertise and independence all have significant and positive relationship with earnings quality with the exception of audit committee multiple directorships that is significant but have negative relationship with earnings quality. The study concludes that audit committee size, frequency of meetings, financial expertise and independence improve financial reporting quality under the sampled firms. The study recommends that appointment of multiple directors should be reduced as these directors are not always available; corporate managers capitalize on their unavailability in meetings to make critical financial decision to manage earnings.