Motivated by agency conflicts of real earnings management and upper echelons in CEO demographic characteristics, this study examines the effect of CEO attributes on real earnings management and addresses the question of whether the presence of an independent board ensures accurate and reliable financial reporting practice. The study also examines the extent to which independent boards moderate the relationship between CEO attributes and real earnings management. Using a sample of 292 observations from Nigeria, an emerging market, from 2018 to 2021, a feasible generalized least square (FGLS) regression model was used to analyze the data. The authors also consider alternative measures of real earnings management. Our results demonstrate that CEO financial expertise, compensation, and CEO nationality reduce real earnings management and improve the financial reporting quality. Accordingly, the results show that independent directors on the board strengthen the CEO’s ability to reduce likely earnings manipulation. However, we find that the presence of a female CEO does not mitigate real earnings manipulation, but that the presence of independent directors enhances the ability of female CEOs to reduce earnings manipulation and produce reliable financial reports. Our results are robust and may have implications for regulators, shareholders, managers, and researchers because it shows that CEO attributes and the presence of independent directors on the board are associated with higher earnings quality.

This study examines factors influencing and constraining the decision to recognize zero goodwill impairment in a sample of 52 Singaporean listed firms from 2010–2012. Using binary logistic regressions, the results reveal that firms that are approaching violation of their debt covenants have a higher likelihood of exercising the recognition choice, while a higher proportion of audit committee independence constrains this choice. The policy implication of this study is that to improve the quality of the financial statements, the relevant authorities need to monitor firms’ reporting incentives closely. This study contributes to the literature on IFRS by providing evidence that supports the applicability of the debt hypothesis in explaining the decision of Singaporean listed firms to recognize zero goodwill impairment.

The present study investigates whether ethnic diversity among firms’ directors influences the decision to take goodwill write-offs, after considering the economic factors of impairment (measured in terms of the market capitalization indicator), reporting incentives, and firms’ internal governance. The analysis focuses on energy firms in Malaysia from 2006 to 2018. The regressions results based on binary logistics show that energy firms are less likely to take goodwill write-offs even when the market indicates the possibility for the write-offs. The results also show the absence of the direct relationship between goodwill impairment decisions and ethnic diversity of the board of directors. Nevertheless, the results reveal that board ethnicity moderates the relationship between firms’ goodwill impairment decisions and the market capitalization indicator, suggesting that as firms encounter increasing market indicator of impairment losses, the board with diverse ethnicity positively influences firms in taking goodwill write-offs. The results of the present study add to the literature on board diversity and firms’ decisions with regard to goodwill impairment by highlighting the beneficial roles of having ethnically diverse board of directors, in that they use the market indicator that goodwill may be impaired in their monitoring role on the goodwill impairment decisions. The results offer input to the policymakers by suggesting that to strengthen the monitoring roles of the board of directors, they need to be diverse and equipped with indicators that would assist them in their monitoring decisions. AcknowledgementThe author acknowledges’ the research funding (i.e., FRGS grant 13591 provided via Universiti Utara Malaysia) from the Ministry of Higher Education in Malaysia.