Audit Firm Report and Financial Performance of Money Deposit Banks in Nigeria

The Nigerian Accountant - The Official Journal Of The Institute of Chartered Accountants of Nigeria, January/March 2017

15 Pages Posted: 4 Feb 2017

See all articles by Egbunike Francis

Egbunike Francis

Nnamdi Azikiwe University - Department of Accountancy

Mary-Fidelis Chidoziem Abiahu

Nnamdi Azikiwe University - Department of Accountancy

Date Written: January 30, 2017

Abstract

The main objective of this study is to determine the effect of audit firm characteristics on financial performance of money deposit banks in Nigeria. Specifically the study shall determine the effect of audit quality, audit fee, and audit report lag on return on assets of Nigerian banks. Next, ascertain the effect of audit quality, audit fee, and audit report lag on earnings per share of Nigerian banks. And finally, examine the effect of audit quality, audit fee, and audit report lag on net profit margin of Nigerian banks. The study adopted the ex post facto and correlational research design. The study population comprised all money deposit banks in existence as at 2015 financial year end. The study finds that audit quality has a significant effect on return on assets of Nigerian banks; Audit fee and audit report lag had no significant effect on return on assets, earnings per share and net profit margin of Nigerian banks. The study therefore recommends mandatory rotation of auditors as a significant factor in safeguarding auditor independence and improving the quality of audit; and the establishment of corporate governance principles that address issues relating to board independence and committee sizes to guide activities in the banking sector.

Keywords: Audits Firm Characteristics, Performance, Auditors, Accounting Academics, Audit Quality, Return on Asset

JEL Classification: M41, M42

Suggested Citation

Egbunike, Chinedu and Abiahu, Mary-Fidelis Chidoziem, Audit Firm Report and Financial Performance of Money Deposit Banks in Nigeria (January 30, 2017). The Nigerian Accountant - The Official Journal Of The Institute of Chartered Accountants of Nigeria, January/March 2017, Available at SSRN: https://ssrn.com/abstract=2909492

Chinedu Egbunike

Nnamdi Azikiwe University - Department of Accountancy ( email )

Awka, Anambra 23400
Nigeria

Mary-Fidelis Chidoziem Abiahu (Contact Author)

Nnamdi Azikiwe University - Department of Accountancy ( email )

Awka, Anambra 23400
Nigeria

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