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

Abstract

Financial reporting of listed deposit money banks is important for monitoring and to enhance decision making. To be able to achieve these functions it needs to be comparable with information gotten from other reporting entities for the users of account to make meaning from it. Hence, this study is designed to examine the effect of institutional characteristics on the comparability of financial reporting of selected listed deposit money banks in Nigeria. This study is hinged on the stakeholders’ theory which explains the interaction between the dependent and independent variables and the business environment. The expost facto research design is used in this study and the type of data used is the secondary data which was gathered from the various audited annual reports of the sample banks selected. The population of this study is made up of the twelve listed deposit money banks in Nigeria out of which a sample size of ten were purposively selected. Multiple regression was used in examining the effect of the independent variable (institutional characteristics) on the dependent variable (comparability). The result of the data analysis shows that institutional characteristics have a low effect on the understandability of financial reporting of listed deposit money banks. However, it is concluded that institutional characteristics has a significant effect on the understandability of financial reporting of listed deposit money banks in Nigeria. It is therefore recommended from the study that to enhance comparability, global accounting bodies need to promote it.