Board Independence and Earnings Management of Healthcare Firms in Nigeria
This study was undertaken to examine the relationship between board independence and earnings management of listed healthcare firms in Nigeria. Using convenience sampling, a panel data from eleven (11) healthcare companies that are listed on the Nigerian Stock Exchange were collected from 2012 to 2019. Inferential analyses were done using ordinary least square and logit regression techniques based on 5% level of significance. Earnings management was operationalized with earnings restatement and discretionary accruals. On the final analysis, it was found that board independence was negatively and significantly related to both earnings restatement and discretionary accruals. Therefore, on the basis of the results obtained, the study came to the conclusion that is consistent with independent directors having strong incentives to curb earnings management tendencies. It is therefore recommended that listed healthcare companies should ensure adequate and reward remuneration package to attract and retain industry-experienced independent professionals to serve on their boards.
