Department of Accounting and Finance
Abstract
The study evaluated the effect of firm characteristics on discretionary expenses and discretionary production costs in listed oil and gas firms in Nigeria. The study adopted a longitudinal research approach. The populations of this study encompassed the 12 oil and gas companies listed as of the last quarter of 2021 on the Nigerian Exchange Group (NGX). The study made use of secondary data from the 2002–2021 annual reports of oil and gas companies listed on the Nigerian Exchange Group. The study adopted Pooled Ordinary Least Square (OLS) regression analysis as the method of data analysis. According to the findings, the firm characteristics proxies used had a significant impact on discretionary expense and also firm characteristic variable had a positive effect on discretionary cost. Based on the above findings, this study concludes that firm characteristics play a major role in the management of earnings in Nigeria's oil and gas industry. The study therefore recommended that Managers of publicly traded companies in the oil and gas sector that have discretion in both operating choices and financial reporting may utilise this discretion to increase profit predictability and give stakeholders positive information.
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