Audit Pricing and Audit Market Concentration in Nigeria: The Moderating Effect of Firm Attributes

Abstract

The purpose of this study is to examine audit market concentration and audit pricing in Nigeria with the moderating effect of firm attributes. The fundamental theory explored in this research is the agency theory. The sample size of 66 statistical observations was taken from the listed Health and Pharmaceutical Firms in the Nigerian Exchange Group (NGX) for the period of 2012 to 2022. The data were analyzed using least square regression technique. The outcome of the testing model showed that audit market concentration has a positive and significant effect on audit pricing at 1% level while a moderating effect between firm attributes and audit market concentration on audit pricing was positive and significant at 5% level. The study recommended that management of listed Health and Pharmaceutical firms in Nigeria should ensure that audit pricing is based on audit market concentration for quality audit reporting. In
addition, management should consider the presence of firm attributes as fundamentals in thepricing of audit engagement by client firm as it contributes immensely to audit quality immensely.