Ownership Structure and Financial Reporting Quality of Listed Consumers Goods Companies in Nigeria

Abstract

This study examines the impact of ownership structure on financial reporting quality in Nigeria’s listed consumer goods companies. It focuses on managerial ownership, institutional ownership, and ownership concentration. Using an ex-post facto and correlational design, the study analyses secondary data sourced from annual reports of 15 out of 20 consumer goods companies in Nigeria, selected based on availability of data and age of listing, over a ten-year period (2012-2021). The Modified Jones model is applied to assess financial reporting quality through discretionary accruals. Data was analysed using panel regression. The results show that managerial and institutional ownership have negative but non-significant effects on reporting quality, while ownership concentration has a positive, though also non-significant, effect. The study concludes that while managerial and institutional ownership do not significantly affect reporting quality, ownership concentration shows a potential positive influence. It recommends optimising managerial ownership, leveraging institutional investors' monitoring role, and strengthening governance for firms with high ownership concentration to improve financial reporting quality.