Forensic Audit Technology and Audit Report Quality of Selected Audit Firms in Nigeria

Abstract

The resultant effect of adapting forensic technology with the intention of improving audit approach for the cause of redeeming the public trust in auditors' reports which has been on the decline is the focus of the study. Hence, the influence of data analytics and textual analytics as forensic audit technology on the audit report quality of selected audit firms in Nigeria was examined. Using a survey research design, a structured five-point Likert scale questionnaire was employed and 106 useful questionnaires were retrieved from the monkey survey on experienced and professional auditors from the 281 registered auditing firms with ICAN as of January 1st of 2022. The census sampling technique was adopted and the obtained response was analyzed using ordinal logistic regression. The findings show that data analytics have a positive and significant effect on audit report quality while textual analysis has negative and significant effect on the audit report quality of selected audit firms. It was then concluded that the usage of data analysis techniques in gathering audit evidence improves the quality of reports issued by audit firms in Nigeria. It is recommended that audit firms should embed forensic technology in audit engagement to sharpen their opinion through proper audit evidence and in turn favorably influence audit quality.