EFFECT OF AUDIT QUALITY ON THE MARKET VALUE OF LISTED NON-FINANCIAL COMPANIES IN NIGERIA

This study examined the effect of audit quality on the market value of listed non-financial companies in Nigeria. Audit quality was explained by Audit Firm Size (AFS), Audit Experience (AE), Auditor Industry Specialization (AIS), Audit Fees (AF), Audit Tenure (AT) and Audit Opinion (AOP) while market value by market Price per Share (MPS). Expost facto design was adopted for this study.The requisite data were obtained from the audited financial statements of 47 listed non-financial companies for a period of 12 years (2004-2015) giving rise to 564 company-year observations. Multiple linear regression analysis, particularly, the Ordinary Least Squares (OLS) method was used to analyze the data. The results indicated that audit quality has significant positive effect on market value of non-financial companies listed in Nigeria. More specifically, AFS, AIS, AF, AT and AOP have significant positive effect on market value whereas, AE exerts a significant negative effect on market value. We therefore recommend that regulatory bodies such as Securities and Exchange Commission (SEC), Financial Reporting Council (FRC), Corporate Affairs Commission (CAC), and professional accounting bodies like Institute of Chartered Accountants of Nigeria (ICAN) and Association of National Accountants of Nigeria (ANAN) should ensure audit quality by enforcing thesanctions and disciplinary measures on auditors/audit firms that tend to mar audit quality as audit quality is seen to have the capability of significantly affecting the market value of companies in Nigeria positively