IMPACT OF AUDIT QUALITY ON FINANCIAL PERFORMANCE OF BANKING INDUSTRIES INNIGERIA

Abstract

Internal audits help ensure accountability, transparency, and public property preservation. This research
focused on audit quality's impact on Nigerian banks' financial performance. The 2004-2019 study used
secondary data from sampling banks' annual financial statements. Ex-post facto study design and descriptive
statistics and OLS multiple regression estimation were used. Audit Company Size (AFS) and Audit Fee (AF)
boost firm performance, whereas Audit Report Lag (ARL) hurts Nigerian banks' performance. Only Audit Fee
(AF) was statistically insignificant (p>0.05); Audit Firm Size (AFS) and Audit Report Lag (ARL) were
significant (p0.05). Without enough effort to monitor the financial performance of banking businesses in
Nigeria, they will continue to stray from reporting correct profits figures by providing earnings data that
appear lovely but are not genuine, deceiving investors and other stakeholders. A long association between the
Auditor and his client may threaten independence and audit quality due to personal ties and familiarity. This
will reduce the Auditor's vigilance and favoritism toward the company's senior managers. The audit
engagement may become commonplace, leading in less effort to discover internal control flaws and risk
sources.