Original Research Article | OPEN ACCESS
Corporate Attributes and Earnings Quality: The Moderating Effect of Corporate Age

Gloria Pam Dachomo1 , Bala Hussaini2 ,

1Department of Accounting, Faculty of Management Sciences, Kaduna State University, Nigeria..

For correspondence:-  Gloria Dachomo   Email: glodachomo@gmail.com

Received: July 15, 2020        Accepted: August 25, 2020        Published: September 30, 2020

Citation: Dachomo GP, Hussaini B, Corporate Attributes and Earnings Quality: The Moderating Effect of Corporate Age. Account Tax Rev 2020; 4(3):1-10 doi:

© 2020 The authors.
This is an Open Access article that uses a funding model which does not charge readers or their institutions for access and distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0) and the Budapest Open Access Initiative (http://www.budapestopenaccessinitiative.org/read), which permit unrestricted use, distribution, and reproduction in any medium, provided the original work is properly credited..

Abstract

It has been argued that corporate age is more than a surrogate that only serves as a control variable, and thus, thedebate between young and old firms in itself requires a revision.Therefore, this study provides a unique finding of the influence of corporate age diversity on the relationship between corporate attributes and earnings quality of listed companies in Nigeria. The study employs 616 firm-year observations for the period of 2012 to 2018. The data for the study are extracted from the annual reports of the listed firms and Thompson Reuters DataStream. Accruals model developed by Collins et al. (2017) is used as a proxy for earnings quality. A robust model is used to estimate the primary model of the study. The study documents that corporate sizeis less likely to reduce earnings manipulation than larger firms. It also reveals thatcorporate leverage, corporate board expertiseand corporate age plays a crucial role in preventing earnings manipulation. The study also shows that corporate age moderates the negative relationship between corporate growth and earnings quality of listed companies in Nigeria. This suggests that older firms are more manured, and thus, they are more likely to protect their reputational capital than younger firms.

Keywords: Corporate attributes, earnings quality, corporate age, discretionary accrual, investments


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