Board size and board independence as determinants of financial statement fraud prevention in Nigerian deposit money banks
DOI:
https://doi.org/10.33003/fujafr-2026.v4i2.301.343-354Keywords:
Board Size, Board Independence, Financial Statement Fraud, Corporate Governance, Deposit Money BanksAbstract
Purpose: This study examined board size and board independence as determinants of financial statement fraud prevention in Nigerian deposit money banks. The objective was to investigate how board size and board independence influence the prevention of financial statement fraud.
Methodology: The study employed a quantitative research design using secondary data obtained from the annual reports of twelve listed deposit money banks in Nigeria covering a ten-year period from 2014 to 2023. The data were analysed using descriptive statistics, correlation analysis, and panel regression techniques based on a fixed-effect model.
Results and conclusion: The findings revealed that both board size and board independence had significant positive effects on financial statement fraud prevention. These results suggested that larger boards and a higher proportion of independent directors enhanced oversight capacity and reduced the incidence of fraudulent reporting. The study concluded that strong board governance mechanisms promote transparency and integrity in financial reporting.
Implication of findings: The findings imply that banks and regulatory authorities should prioritize maintaining optimally sized and independent boards to strengthen fraud prevention frameworks. This may lead to more effective monitoring, reduced financial misstatements, and improved stakeholder confidence in the Nigerian banking sector.
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