Impact of Audit Fees on Audit Quality of Conglomerates Companies in Nigeria
Audit failures such as in the case of Enron Corporation, WorldCom Corporation, Global Crossing, ImClone Systems Incorporation and Tyco International have raised concerns on the auditors' ability in discharging their duties. Emergent economies are not exceptional from large corporate failures; for instance the corporate failures in the Nigerian financial sector in the early 1990s brought auditors into sharp focus and caused the public to question the role of accountants and auditors. This study assessed the impact of audit fees on audit quality of listed conglomerates in Nigeria over the periods 2004 to 2015. Data for the study were collected from the annual reports and accounts of the companies. A panel data was employed specifically using, OLS and Random Effect regressions. The paper observed that both audit fees and audit firm size have positive impact on company audit quality. The paper suggested the need for regulatory bodies in line with best practices to look critically into proper modalities for charging audit fees that is commensurate with the audit effort.
Audit Fees, Audit Quality, Audit Tenure, Discretionary Accruals
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