ABSTRACTThis paper studies the relationship between different corporate governances mechanisms and earnings management.

It examines two categories of governance devices; internal (ownership concentration and board structure) and external (take-over pressure and institutional ownership).

Controlling for other characteristics, I find that firms with stronger internal governance, such as higher ownership concentration and smaller boards, manager earnings more, while firms with stronger external governance, such as higher institutional holdings and high take over pressure, manage earnings less.

The evidence indicates that earnings management is not mainly driven by the conflict between ownership and control but by the conflict between insiders and outsiders. Frank Yu’ June (2006).

A set of listed companies have been investigated to analyze the relationship for the year 2006. Quality has been measured by assigning weights to a set of related variables, whereas earnings management has been quantified by discretionary accruals. Modified cross sectional Jones model has been used to determine the discretionary accruals. Ordinary Least Square estimation indicates the presence of positive relationship between corporate governance and earnings management.

Result appear unconventional, it may be due to the transition phase through which the Pakistani companies are passing after promulgation of Code of Corporate Governance in 2002 which has created a tendency to increase discretionary accruals as a risk averse measure. Euro Journals Publishing Inc, 2009.

The purpose of this research work is to determine the impact of corporate governance on earnings management in selected fifteen commercial banks in Nigeria. The Commercial banks are Zenith International Bank Plc, Afribank Plc, Union Bank Plc, Skye Bank Plc, Intercontinental Bank Plc, United Bank for Africa Plc, Wema Bank Plc, First City Monument Bank Plc, Equitorial Trust Bank Plc, Platinum Habib Bank Plc, Fidelity Bank Plc, First Bank Plc, Unity Bank Plc and Spring Bank Plc.

The research study found out that:

1. Corporate governance impacts on earnings management in most commercial banks in Nigeria.

2. It was not true that corporate governance does not impacts on earnings management in commercial banks in Nigeria.

3. There is relationship between different corporate governance mechanism and earnings management of commercial banks in Nigeria. Source: Response from Questionnaire.

TABLE OF CONTENTS

Title Page

Declaration

Certification

Dedication

Acknowledgement

Table of Contents

Abstract

CHAPTER ONE

1.0 Introduction

1.1 Statement of Research Problem

1.2 Objectives of the Study

1.3 Scope of Study

1.4 Relevance of the Study

1.5 Statement of the Research Hypothesis

CHAPTER TWO: LITERATURE REVIEW

2.0 Introduction

2.1 Earnings Management

2.1.1 Management Compensation Contracts
2.1.2 Earnings Management Using Classification Shifting

2.1.3 Earnings Management and Resource Allocation

2.1.4 Earnings Management and Investment Decisions

2.1.5 Earnings Quality and Investment Decisions

2.1.6 Lending Contracts

2.1.7 Earnings Management Internal Control Sarbanes-

Oxley, Section 404

2.1.8 Earnings Management Investor Protection and

National Culture

2.1.9 Impact of Investor Protection and Culture on

Earnings Management

2.20 Corporate Governance

2.2.1 Scoring Corporate Governance Practices

2.2.2 Corporate Governance and Financial Reporting

2.2.3 Board Independence

2.2.4 Size of the Board

2.2.5 Block Holders

2.2.6 Board Structure

2.2.7 Institutional Ownership

2.2.8 Takeover Pressure

2.2.9 Internal Governance

2.2.9.1 Linkages Between Earnings Management and

Corporate Governance

CHAPTER THREE

3.0 Introduction

3.1 Population And Sample

3.2 Data Collection Methods

3.3 Sources of Data

3.4 Research Instruments

3.5 Data Analysis Method

3.6 Analytical Tools

3.7 Limitation of Study

CHAPTER FOUR

4.0 Introduction

4.1 Respondents Characteristics and Classification

4.2 Presentation and Analysis of Data According to

Test Hypothesis

CHAPTER FIVE

5.0 Introduction

5.1 Summary of Findings

5.2 Discussion of Findings

5.3 Recommendations

5.4 Conclusion

Bibliography

Appendix