EFFECT OF AUDIT QUALITY ON FINANCIAL PERFORMANCE: A STUDY OF SELECTED OIL AND GAS COMPANIES IN NIGERIA

ABSTRACT The study investigated the effect of audit quality on financial performance. In order to critically brainstorm into the topi of discuss, three specific objectives were identified which are: to determine the effect of Audit Fee on Return on Assets of selected oil and gas companies in Nigeria; to evaluate the effect of Audit Size on Return on Assets of selected oil and gas companies in Nigeria and to examine the effect of Audit Tenure on Return on Assets of selected oil and gas companies in Nigeria. The study was anchored on both the signaling theory and agency theory. The study employed the ex post facto research design for the study. The population of the research was 50 oil and gas companies operating in the Nigerian oil and gas sector as at 2022 out of which the study made use of a sample size of 6 listed oil and gas companies. Secondary data were explored, while correlation and logistic regression techniques of data analvsis were employed to provide answers for the research questions and for testing the research hypotheses. The findings from this study however revealed that there is a significant effect of Audit Fee on Return on Assets of selected oil and gas companies in Nigeria; there is a significant effect of Audit Size on Return on Assets of selected oil and gas companies in Nigeria and that Audit Tenure has a significant effect on Return on Assets of selected oil and gas companies in Nigeria. Hence, the study concluded that audit fee, audit size and audit tenure have a positive significant effect on financial performance among listed Nigerian companies in the oil and gas sector. The study recommended among others that Audit Fee should be raised as this will facilitate and enhance more commitment and professionalism on the part of auditors.