Moderating effect of audit committee on board diversity and earnings management in Nigerian banks.
This study examines the impact of board diversity and audit committee on earnings management of listed deposit money banks and the effects of moderating factors that overcome the tendency of managers to engage in earnings manipulation. Using a population of fifteen listed deposit money banks in Nigeria, secondary data were obtained from the annual reports and accounts of the banks for the period 2008-2015. Multiple regression technique was adopted and Stata 13 used as the tool of data analysis. The findings revealed that before moderation all the variables, except board size, have significant effect on earnings management of banks. After moderation, the findings revealed that explanatory variables explained the extent of earnings management better than before moderation. The study recommends that the percentage of women director, shares held by directors and number of foreign directors should be increased, while the number of non-executive directors on audit committee should also be improved upon in order to mitigate the tendencies for manipulation of earnings management in banks. This study claims originality in the use of audit committee as moderating variable and the test of applicability and the usefulness of Chang, Shen and Fang (2008) model in Nigerian Banking Sector