Determinant of Financial Reporting Quality on Ethiopian Insurance Companies
Abstract:
This study intends to assess the determinants of
financial reporting quality of Ethiopian insurances companies over a period of
2019/20-2023/24. Consequently, the study used document review of insurances’
audited financial statements. The explanatory variables used in this study were
board size, leverage, profitability (ROA), Liquidity and Auditor change. In the
study bank age and firm size were used as control variables. In this study
fourteen Insurance companies were selected from a total population of insurances
companies to accomplish a study for the period of six years (2019/20-2023/24)
with the total of 95 observations. To test the hypotheses, the study adopted
the quantitative research approach. The secondary data were analyzed using
descriptive statistics, correlation matrix and linear regression analysis and
data from document reviews were interpreted qualitatively. The study used panel
data and random regression model to analyze the determinant of financial
reporting quality of Ethiopian insurance companies. The study found that
profitability ratio has positive and significant effect on financial reporting
quality. While, auditor changes, board size, leverage and liquidity were found
to be insignificant effect on financial reporting quality of Ethiopian
insurance companies.
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