CORPORATE GOVERNANCE AND FINANCIAL PERFORMANCE OF LISTED

DEPOSIT MONEY BANKS IN NIGERIA.

BY

ADEWUMI OLUWATOYIN ADENIKE

S01/ACC/2015/8792

FEBRUARY, 2024.

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 CORPORATE GOVERNANCE AND FINANCIAL PERFORMANCE OF LISTED

DEPOSIT MONEY BANKS IN NIGERIA.

BY

ADEWUMI OLUWATOYIN ADENIKE

S01/ACC/2015/8792

A PROJECT SUBMITTED TO THE DEPARTMENT OF ACCOUNTANCY, FACULTY OF

IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE AWARD OF HIGHER

FEBRUARY, 2024

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 DECLARATION

ADEWUMI OLUWATOYIN ADENIKE with matriculation number S01/ACC/2015/8792

declare that this project work was carried out by Me under the supervision of MR. SOYINKA,

K.A. of the Department of Accountancy, Rufus Giwa Polytechnic, Owo, Ondo State. I attest that

this project has not been presented either wholly or partly for the award of any diploma elsewhere.

All sources of data and scholarly information used in this project are duly acknowledged.

ADEWUMI OLUWATOYIN ADENIKE ……………………….

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 CERTIFICATION

We, certify that this research work titled “Internal Control Systems and Performance of Listed

Firms in Nigeria” is an original work carried out by ADEWUMI OLUWATOYIN ADENIKE

Matriculation number, S01/ACC/2015/ 8792 in the Department of Accountancy, Rufus Giwa

Polytechnic, Owo, Ondo State, Nigeria, under the supervision of MR. SOYINKA K.A. We have

examined and found the work acceptable for the award of Higher National Diploma (HND) in

Accountancy.

MR. SOYINKA K. A. (ACA, ACIT) ________________________

(SUPERVISOR) SIGNATURE & DATE

MR. LODIKERO OLUSOLA. (FCA) ________________________

(HEAD, DEPARTMENT OF ACCOUNTANCY) SIGNATURE &

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 DEDICATION

This project is dedicated to the Almighty God, the source of all knowledge, for giving us the

strength to pursue and complete this work.

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 ACKNOWLEGEMENTS

My appreciation goes to Almighty God for granting me healthy life, mercy, protection and grace

to complete this project work successfully.

My sincere appreciation also goes to my parent MRS ADEWUMI and my well-wisher for

their financial support, advise, and prayer. from the beginning of my course of study.

In fact you are more than millions of gold I will forever appreciate you. Big thanks to you.

Our sincere appreciation goes to my friends, The person of AKINNUOYE JULIUS A,

AKEREDOLU SEGUN J. AND SAMSON ADEKUNLE thank you all for your understanding,

support, encouragement and patience throughout the program. My sincere thanks also go to all my

colleagues, the members of 2021/2022 H.N.D Accountancy class.

My profound gratitude to my able project supervisors, MR SOYINKA, K.A and to my able

H.O.D, MR. OLODIKERO F.C.A for their fatherly advice and for their full supports in this

project May the lord continue to bless you (Amen).

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 TABLE OF CONTENTS

Page

COVER PAGE i

TITLE PAGE ii

DECLARATION iii

CERTIFICATION iv

DEDICATION v

ACKNOWLEDGEMENTS vi

TABLE OF CONTENTS vii

LIST OF TABLES xi

LIST OF APPENDIX xii

ABSTRACT xiii

CHAPTER ONE

INTRODUCTION

1.1 Background to the study 1

1.2 Statement of the Research Problem 3

1.3 Research Questions 5

1.4 Aim and Objectives of the study 5

1.5 Research Hypotheses 6

1.6 Scope of the Study 6

1.7 Significance of the Study 7

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CHAPTER TWO

LITERATURE REVIEW

2.1 Preamble 8

2.2 Conceptual Review 8

2.2.1 Corporate Governance 8

2.2.2 Corporate Governance Characteristics 10

2.2.3 Financial Performance 10

2.1.4 Measurement of Financial 15

2.3 Theoretical Review 16

2.3.1 The Agency Theory 17

2.2.2 The Stakeholder’s Theory 19

2.3.3 Theoretical Justification 20

2.4 Empirical Review 21

2.4.1 Board Size and Financial performance 21

2.4.2 Board Composition and Financial Performance 23

2.4.3 Audit Committee Size and Financial Performance 25

2.5 Summary and Gaps in Literature 27

CHAPTER THREE

METHODOLOGY

3.1 Preamble 30

3.2 Research Design 30

3.3 Study Population 30

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3.4 Sample Size and Sampling Techniques 31

3.5 Data Collection 31

3.6 Measurement of Variable 31

3.8 Data analysis Techniques 33

CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS

4.1 Preamble 34

4.2 Data Presentation 34

4.3 Data Analysis 34

4.3. Descriptive Analysis of Data on Relevant Variables 35

4.4 Testing of Hypotheses 37

4.5 Discussion of Findings 40

CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS

5.1 Preamble 42

5.2 Summary of Findings 42

5.3 Conclusion 42

5.4 Recommendations 42

5.5 Contribution to Knowledge 44

5.6 Limitations of the Study 44

5.7 Suggestion for Further Research 45

REFERENCES 46

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 APPENDIX 52

LIST OF TABLES

Table 3.1: Measurement of Variable 41

Table 4.1: Descriptive Statistics 46

Table 4.2: Correlation Analysis 47

Table 4.3: Variance Inflation Factor 48

Table 4.5 Panel Regression Analysis 49

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LIST OF APPENDIX

APPENDIX 1 68

APPENDIX 2 68

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 ABSTRACT

This study examined the impact of internal control system on performance of listed companies in
Nigeria. The specific objectives of this study is to find out if there is a significant relationship
between internal control attributes (internal control activities, internal monitoring activities,
internal risk assessment activities) and performance of listed companies in Nigeria. The study
adopted a correlational research design and panel data analysis. In addition, the corporate annual
reports and website for the periods 2017-2021 were utilized as the main sources of secondary data.
In testing the research hypotheses and to ascertain the significant effect of the variables, the study
utilized panel estimation technique methods of data analysis. The findings revealed a significant
positive relationship between internal control activities, internal monitoring activities, internal risk
assessment activities with firm performance. The study, therefore recommended that the Nigerian
listed companies should increase the internal control activities, internal monitoring activities,
internal risk assessment activities in order to increase the level of their firm performance.

Keywords: Control activities; Firm performance; Internal control system; Monitoring activities;
Risk assessment.

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