THE IMPACT OF AUDIT FUNCTION ON THE FINANCIAL PERFORMANCE OF LISTED COMMERCIAL BANKS IN NIGERIA: A MODERATING ROLE OF FIRM SIZE

This study investigated the impact of the audit function on the financial performance of listed commercial banks in Nigeria, focusing on the moderating role of firm size. The research employs a descriptive design, analyzing data from the annual financial statements of selected banks over the period from 2015 to 2024. Key variables examined include Audit Firm Size, Audit Fee, Audit Tenure, and Return on Assets (ROA). The findings reveal that neither Audit Firm Size nor Audit Fee significantly affects ROA, while longer Audit Tenure is associated with lower financial performance. Additionally, firm size does not play a moderating role in the relationship between audit functions and financial performance. These results challenge common assumptions regarding the effectiveness of larger audit firms and higher fees as indicators of better financial outcomes. The study emphasizes the importance of qualitative factors in auditing practices, suggesting that auditor competence and independence may be more critical than size or cost. These insights provide valuable implications for stakeholders in the banking sector, highlighting the need for improved audit quality through rigorous procedures and ongoing professional development. In conclusion, the study contributes to the understanding of audit practices within the Nigerian banking sector and underscores the complexities involved in auditor-client relationships. Future research should explore the dynamics of audit functions across different industries and consider the influence of external factors on financial performance.