SUSTAINABILITY OF AUDIT QUALITY AMONG NIGERIAN EMERGING FIRMS: A THEORETICAL REVIEW

Abstract

Audit quality is crucial for ensuring the transparency, reliability, and integrity of financial reporting, thereby reinforcing stakeholder trust and contributing to corporate governance and economic stability. Sustainability in audit quality extends beyond individual assessments to emphasize the consistent delivery of high-standard audits over time, which is particularly pertinent for Nigerian firms navigating complex institutional environments. However, this theoretical review examines the sustainability of audit quality within Nigerian emerging firms, a context characterized by dynamic economic growth, evolving regulatory frameworks, and distinct socio-cultural challenges. The review highlights the interplay of economic, regulatory, cultural, and institutional factors that influence audit quality in Nigeria. Economic instability, resource constraints, and market volatility are identified as critical impediments to sustaining high-quality audits. Similarly, weak regulatory frameworks and limited enforcement mechanisms undermine audit practices, while cultural dynamics including ethical norms and business traditions, further complicate the auditing landscape. Institutional factors, such as governance structures and professional associations, are pivotal in fostering a culture of accountability and maintaining audit standards. The paper identifies significant gaps in the existing literature, particularly regarding the unique challenges faced by Nigerian firms, and underscores the need for tailored theoretical frameworks. The paper also proposes actionable recommendations for policymakers, regulators, and practitioners to enhance audit quality sustainability, aligning local practices with global standards and leveraging technological advancements. Addressing these challenges, Nigerian firms can build robust financial systems that attract foreign investment, support market confidence, and promote long-term economic growth.