Title: Interplay Of Audit Quality And Firm's Performance Of Listed Consumer Goods Companies In Nigeria
Authors: David Njuare George
Volume: 9
Issue: 9
Pages: 43-53
Publication Date: 2025/09/28
Abstract:
This study investigates the relationship between audit quality and the performance of listed consumer goods firms in Nigeria, employing both Agency Theory and Lending Credibility Theory as the theoretical frameworks. The data were extracted from secondary sources, specifically the annual reports and accounts of 16 listed consumer goods firms in Nigeria, covering a period of ten years (2012-2021). A multiple linear regression technique was employed to analyze the data, utilizing descriptive statistics and Pearson correlation with STATA as the statistical tool. Return on Equity (ROE) and Economic Value Added (EVA) were used as proxies for firm performance. The findings reveal that audit firm independence, joint audit, audit firm experience, and audit partner tenure all have a positive and significant impact on the performance of listed consumer goods firms in Nigeria. However, audit firm reputation was found to have a negative impact on firm performance. Based on these results, the study concluded that audit quality dimensions are a key element that influences the performance of listed consumer goods firms in Nigeria. Specifically, factors such as audit firm independence, joint audits, audit firm experience, and audit partner tenure were shown to positively influence firm performance, with a stronger presence of these factors correlating with improved profitability and overall performance. The researcher recommended that shareholders ensure their firms are audited by reputable audit firms that offer independent, accurate, and efficient audit services, as these factors are crucial for enhancing firm performance.