Impact of Audit Fee Paid to Accounting Firm on Financial Reporting Quality of Listed Insurance Companies in Nigerian

Abstract

This study examined the impact of audit fee paid to accounting firms on financial reporting quality
of listed insurance companies in Nigeria. The data for the study was collected from annual report
and accounts of the thirteen (13) sampled insurance companies out of thirty three (32) listed on the
Nigerian Stock Exchange for the period of eight (8) years (2008 to 2015). Empirical analyses were
carried out using Pearson correlation and multiple regressions (Ordinary Least Square). The
findings from the analysis showed that audit fee paid to accounting firm has positive and significant
impact on financial reporting quality with the co-efficient of 0.10224. Base on the findings, the
study concludes that the higher the audit fee paid to the accounting firm the better the quality of
financial statement audited by such accounting firms. The study therefore, recommends that
accounting firms should put more effort in performing their legitimate responsibility in such a way
that the firms should give credible opinion on the financial statements of the audited companies so
that users will have confidence in the report prepared and this will further straighten the quality of
financial statement