VOlUME 01 ISSUE 01 APRIL 2022
1Mabur Zumbung Danladi (Ph.D), 2Maram Isa Maren, 3Mike Daspan Gwaska
1,2,3Department of Accounting, Plateau State University, Bokkos, Plateau State.
ABSTRACT
The purpose of the paper is to investigate the relationship between Normative influence and risk disclosure in Nigeria. Considering the 14 deposit money banks listed on the stock exchange, a partial least squares- structural equation model was run to examine the influence of normative influence on the extent of risk disclosure measured through an index based on the information disclosed in their annual reports. Findings from the analysis revealed that normative influence has a significant relationship with the risk disclosure of deposit money banks in Nigeria. The possible explanation for such a situation could be that, when firms employ well-educated people, they understand the need to be transparent in the discharge of their duties including disclosure decisions. Professionalism enables employees to be able to advise management of the need to be transparent in corporate reporting practice. The implication of such a finding in the banking industry is that normative influence is important in determining the level of risk disclosure of Deposit money banks in Nigeria. It is recommended that banks should employ only professional members of the Institute of Chartered Accountants of Nigeria, Association of National Accountants of Nigeria, Chartered Institute of Bankers, for all their administrative positions so that a high level of objectivity would be achieved in the discharge of their duties including risk disclosure. Other, non-professionals could be employed for other lower posts who always take their directives from the administrative officers.
KEYWORDS:
Bank, Normative influence, risk disclosure, partial least square
JEL CODE: G30, G32, G38
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