Institutional Characteristics and the Faithful Representation of Financial Reporting of Selected Listed Deposit Money Banks in Nigeria

Abstract

Deposit money banks play an important role in any economy as they maintain balance in the economy by moving funds from the excess area of the economy to the deficit are of the economy. Appropriate control and monitoring is needed to ensure their sustenance. In this regard, quality financial reporting helps to monitor the activities of the bank. Hence, this study is aimed at examining the effect of institutional characteristics on the faithful representation of financial reporting of selected listed deposit money banks in Nigeria. This study is pitched on the theoretical lens of agency theory. The study population was made up of the twelve listed deposit money banks in Nigeria out of which a sample of ten was intentionally satisfied. Secondary data was collected from the audited annual reports of the selected banks over a ten-year period. The multiple regression model was used to examine the effect of the independent variable (institutional characteristics) on the dependent variable (faithful representation). The result shows that institutional characteristics have a moderate effect on the faithful representation of financial reporting of listed deposit money banks in Nigeria. It is concluded from the study that institutional characteristics has a significant effect on the faithful representation of financial reporting of listed deposit money banks in Nigeria. It is recommended from the study that accounting standards be developed to take care of institutional characteristics as they affect the financial reports.