EFFECT OF FIRM CHARACTERISTICS ON AUDIT REPORT LAG IN LISTED INSURANCE FIRMS IN NIGERIA
Sufiyanu Usman
Volume 11 Issue 1
Abstract
The study examines the effect of audit type, leverage and firm size on audit report lag of listed insurance firms in Nigeria. The study formulated three hypotheses and used multiple regression analysis as an estimation technique to analyze the secondary data extracted from the annual reports and accounts of the seventeen sampled insurance companies in Nigeria for the period 2014 to 2023. Agency theory was used to underpin the study. The study found that audit type has significant positive relationship with audit report lag. The study also found that leverage and firm size have negative but significant relationship with audit report lag. In respect to the findings, it is recommended that that the Big4 audit firms in Nigeria should maintain their reputation by putting measures to ensure quality audit report are readily available on time to stakeholders and as much as possible the number of days it takes the Big 4 to audit the reports of insurance firms should be reduced to the barest minimum. In addition, board of directors should scrutinize debt financing to maintain higher level of leverage of their respective firms. This is important as the result of the finding showing that an increase in leverage would decrease the duration within which audited financial report of quoted firms in Nigeria is issued. The size of the firm should also be reduced to level that does not violate the industry standards as empirical evidence exists which show negative relationship between firm size and audit report lag. Key Word: Audit Report Lag, Leverage, Firm Size
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