AUDITOR CHARACTERISTICS AND EARNINGS QUALITY OF QUOTED DEPOSIT MONEY BANKS IN NIGERIA

This study investigates the effect of auditor characteristics on the earnings quality of listed deposit money banks in Nigeria. Specifically, auditor characteristics were proxied using audit fees, auditor tenure, audit firm size, and auditor industry specialization. Employing a longitudinal research design, the study utilized panel data drawn from the published annual financial statements of all fourteen (14) commercial banks quoted on the Nigerian Exchange (NXG) Group as of January 1, 2023. A census sampling approach was adopted, covering a ten-year period from 2014 to 2023. Data were analyzed using multiple regression techniques with the aid of STATA Version 16 to test the formulated hypotheses. The empirical results indicate that audit firm size negative but significant effect on earnings quality. Auditor fees exert a positive and statistically significant influence on earnings quality, while auditor tenure and auditor industry specialization exhibit a negative and insignificant effect. Based on these findings, the study concludes that the selection of an audit firm and the magnitude of audit fees play critical roles in determining the credibility and quality of reported earnings in the Nigerian banking sector. Consequently, it is recommended that banks prioritize the reputation, sector-specific expertise, and historical performance of audit firms over firm size when engaging audit services. Emphasis should be placed on the auditors’ technical competence and their capacity to uphold accurate and transparent financial reporting.