preview

Agency Theory and Accounting Choice

Decent Essays

CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
This study analyses the effect of the agency theory and accounting choice usually been made by managers of Nigeria listed companies. It (agency theory and accounting choice) can be demonstrated in the modern day companies where management is usually separated from the ownership of business. The professional managers are supposed to make decisions and take actions that are consistent with the objective of maximising shareholders wealth. But this may not be happen in practice because the managers may have goals that are inconsistent with those of the shareholders (Isenmila, Erabhe, & Ogiedu (2010). Prior researchers like Hagerman & Zmijewski (1979) and Zmijewski & Hagerman …show more content…

Their annual report and accounts for the year ended 2011 was considered as our analysis is set to cover this period.
The researcher has restricted this study to just 100 Companies for the purpose of having a manageable size of sample.
1.6 SIGNIFICANCE OF THE STUDY
This study is relevant to the following interest group: 1) Existing and potential investors as well as business oriented individuals will find the research findings useful for investment decisions. 2) The various companies in Nigeria most especially the quoted ones will find the research findings report useful in decision making. 3) Government authorities and its agencies such as SEC will find the research findings useful in the process of making laws or rules for the purpose of protecting the investors. 4) Analysts and future researchers such as professional accountants,auditors and

Get Access