CORPORATE GOVERNANCE AND ABNORMAL AUDIT FEES

ABSTRACT

This study observed the relationship between some determinants of abnormal audit fees (non-audit fee, client bargaining power, audit tenure, and client complexity) and corporate governance of a sample of thirteen banks listed in Nigeria from the time amid 2018 and 2022. The data used for the analysis was secondary data and it was extracted from the annual financial statements of the listed banks. Via panel data methodology as a method of estimation, the result provides a positive significant impact between abnormal audit fees and client complexity as well as audit tenure, client bargaining power and non-audit fee. The study however could not provide a significant relationship between abnormal audit fee and audit tenure and non-audit fee. But there is a significant relationship between abnormal audit fees and client bargaining power and client complexity. The study therefore mentions that professional bodies in Nigeria (like ICAN and ANAN) should try to review, harmonize and enforce minimum audit fee-benchmarks to be charged in audit engagement. Also both clients and auditing firms should adopt a strategic and collaborative approach when engaging in fee negotiations.