Citation:

Mohammed Abba, Bilyaminu Yusuf Hanga, Mohammed Mahmud Kakanda, Alhaji Lukman Babarabi. "Ownership Structure and Earnings Management of Listed Healthcare Companies in Nigeria" International Research Journal of Economics and Management Studies, Vol. 2, No. 2, pp. 150-157, 2023.

Abstract:

Corporate management does participate in practices like earnings management that harm investors' interests given the recent rise in economic difficulties around the world. As a result, this study looked at how ownership structure affected how listed healthcare companies in Nigeria managed their earnings. Ex-post facto research was used in this study, which had specified healthcare companies in Nigeria as of December 31, 2021 as its target audience. Based on their thorough annual reports, seven (7) of the ten (10) stated companies were particularly selected for the study (2012–2021). The collected data were examined using multiple regression analysis. The results of the analysis demonstrate that institutional ownership has a major negative impact on the methods used by the listed Nigerian healthcare companies under study to manage their earnings, whereas block-holder ownership and foreign ownership have favourable and significant impacts. This implies that businesses with institutional ownership did not employ earnings management to the same extent as Nigerian healthcare companies listed on the stock exchange with the highest proportion of block-holding and foreign ownership. Because block-holding investments and foreign investment were found to tend to encourage earnings management practices, the study advised listed healthcare businesses in Nigeria to reject them. Institutional investors should be supported, though, as it has been discovered that they have a negative impact on how corporations manage their earnings. This would aid in lowering the practice of earnings management in Nigerian healthcare organizations.

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Keywords:

Earnings Management, Healthcare Companies, Nigeria, Ownership Structure.