Original Research Article | OPEN ACCESS

Corporate Governance and Audit Fees of Listed Pharmaceutical Firms in Nigeria

For correspondence:-    

Received: 1 November, 2018        Accepted: 30 November, 2018        Published: 31 December, 2018

Citation: Corporate Governance and Audit Fees of Listed Pharmaceutical Firms in Nigeria. Account Tax Rev 2003; 2(4):14-26 doi:

© 2003 The authors.
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Abstract

This study aimed at ascertaining those corporate governance variables that determine the audit fees of listed pharmaceutical firms in Nigeria for a 6-year period from 2012 to 2017. The study adopts ex-post facto and Panel research design and secondary data are obtained from the annual audited accounts of the sample of seven (7) out of the population of eleven (11) listed pharmaceutical firms based on a purposive sampling technique. Descriptive statistics, correlation,and multiple regression techniques areused to analyse the effectof corporate governance attributes on the audit fees paid by the sampled firms.The study found that board diligence has positive significant effect on audit fees, while board size and board independence have a negative insignificant effect on audit fees. Thus, the study concludes that the directors of listed pharmaceutical firms in Nigeria should always consider their degree of diligence in determining the amount of audit fees since the extent of their thoroughness in addressing reporting issues would play a role in how much external auditors would accept as their fees. Consequently, the study recommends that listed pharmaceutical firms should ensure efficient management of their total asset, maintain an average number of meetings annually, and maintain an audit tenure in line with statutory requirements to curtail excess fees.

Keywords: Board Size, Board Independence, Board Diligence, Audit Fees, Pharmaceutical Firms.