Historical Perspective of Auditing and Professional Accounting Development in Nigeria

Abstract

Auditing as a profession has come of age. It is an independent service that lends credibility from the outset to the report that a representative presents to his or her client. In today's business world, the role of credibility is even more important as ownership is diversified and ownership and control are separated. However, the financial scandals of recent years have led the public to question the credibility of auditing. The periodic and backward-looking approach to auditing is becoming ineffective in light of the global financial debacles of recent years, changing investor information needs, technological advances, and real-time processes in the corporate landscape. The study sought to examine the history of auditing and the evolution of the auditing profession in Nigeria in light of the ongoing change in public expectations. The study was purely exploratory, using desk research without any fieldwork. The data used were from secondary sources and were obtained through documentary survey. The findings of the study revealed that the role and objectives of auditing have always changed in response to circumstances such as financial scandals, court judgments, health threats such as the COVID 19 pandemic, and technological developments in the business environment. In Nigeria, government laws and government regulatory bodies play an important role in the development of the auditing profession. Nevertheless, the responses of the auditing profession have not kept pace with the real-time economy of today's businesses. Some audit approaches and techniques appear to be outdated, especially in developing countries like Nigeria where most audit firms are relatively small. Auditing of the future, therefore, must move from efficiency to effectiveness. There should be a paradigm shift from reactive to proactive audit approaches. Manual auditing is no longer relevant in a sophisticated digital environment. Auditors must close the technology skills gap to be effective. Future audit models will require auditors, regulators, and standard setters to address current challenges in audit timing and frequency, technology and analytical skills gaps, testing and sampling procedures, materiality and independence concepts, and audit data standard delivery.