The Effect of Audit Tenure and Non-Audit Services on Auditors Negligence : A Study of Nigeria

Abstract

The research work examined the impact of audit tenure and non – audit services on auditors negligence. Failure to report certain weaknesses because of the auditors’ negligence in his reports to management often affect the performance of corporate organizations negatively. The specific objectives are: to determine whether audit tenure influences audit negligence, to determine whether non – audit services provided by auditors to its client lead to audit negligence, and to ascertain whether interaction of audit tenure and non – audit service lead to auditors negligence. Business analysts, Investors and Academia were used. Survey design was adopted for this study. Copies of questionnaires were administered to 115 sample respondents. Analysis of variance (ANOVA) was used to analyze data collected statistically at 5% or 0.05 level of significance , and in testing the hypotheses; Regression analysis was used, with the aid of statistical package for social sciences (SPSS) 20.0 soft ware. The test showed that lengthy audit firm tenure lead to audit negligence. The researcher recommends that the auditing profession to make significant regulatory pronouncement in this regard. Accounting and auditing profession is advised to come up with a policy on auditors performing non – audit services to its client. Consequently, auditors should put their own professional code of practice above their clients’ organizational culture which prioritized high profits.