Determinant of Financial Reporting Quality on Ethiopian Insurance Companies

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.