AUDIT FIRM ATTRIBUTES AND AUDIT QUALITY IN NIGERIA

ABSTRACT

The major purpose of this research is to ascertain the relationship between audit firm attributes and audit quality in Nigeria. Four specific objectives guides the study. The study used secondary source of data collection. The corporate annual reports of thirteen (13) banks from the financial services sector on Nigeria Exchange Limited for 2018-2022 financial year was used to measure the relationship between audit firm attributes and audit quality in Nigeria. The summary of the study's findings is as follows: the study revealed a non-significant negative relationship between audit independence and audit quality, the findings indicated a significant positive relationship between audit firm rotation and audit quality, the study found a significant positive association between audit fees and audit quality and also audit delay was found to have a significant positive impact on audit quality. Based on these findings, the following recommendations are proposed to enhance audit quality in Nigerian companies: regulatory bodies should consider setting guidelines for audit fees to ensure they reflect the scope and complexity of the audit work rather than just the size or financial performance of the firm, firms should enforce policies that strengthen auditor independence, such as rotating audit firms regularly and prohibiting auditors from accepting significant non-audit work from their audit clients, regulatory bodies should monitor audit timelines and require transparent reporting on the reasons for any delays, to prevent familiarity threats and encourage fresh perspectives, it is recommended to implement mandatory audit firm rotation policies and lastly audit firms should invest in ongoing training and development for auditors to reinforce the importance of independence, ethical considerations, and best practices in audit procedures.