Incidence of Unclaimed Dividends in Nigeria: Its Cause and Possible Solution
Abstract:
The importance of appropriate dividend policy in influencing investors’ attitude to investment can hardly be overemphasized. While some investor invest mainly for future capital gain resulting from appreciation of their investment, others do so to earn regular annual dividend income. Quoted companies recognise this fact, as seen in their efforts to ensure that they declare dividends irrespective of companies internal fund requirements. The incidence of unclaimed dividend has been growing at an alarming rate in the last ten years. A phenomenon of this nature warrants an empirical investigation to ascertain the causes. This study therefore empirically examined the incidence of unclaimed dividend in Nigeria, with respect to its causes to determine their significant impact, what should be done with the present accumulated unclaimed dividend in Nigeria and to provide for possible solutions. The study obtained data from investing public and the operators of the stock market through the administration of questionnaires on a carefully selected sample size of 150. Three hypotheses were formulated and were statistically tested using binomial test, ANOVA, regression and chi square test. The results indicated significant relationship between some identified causes and the incidence of unclaimed dividend in Nigeria. The study therefore found that the incidence of unclaimed dividend in Nigeria is caused by some factors such as information gap, dividend policy, and market capitalization. It therefore recommended that unclaimed dividend in Nigeria will be significantly reduced if there is accurate and timely exchange of information on the activities of quoted companies especially on dividend and a departure from the current mode paying dividends through the sending of dividend warrants to direct payment of dividends into the bank account of the shareholders opened for that purpose . ORDER COMPLETE MATERIAL FROM CHAPTER 1-5
