ASSESSMENT OF THE EFFECT OF EXTERNAL AUDIT ON BANK FAILURE

Oluwatimileyin Esther Adenle, Progress Onyekachi Anyanwu, Eucharia Ogechukwu Okafor, Olufemi Kolapo Oyaleke

Abstract


This study examines the effect of external audit on bank failures in Nigeria. Questionnaire method was used to collect data for the study and the results were analyzed using frequency, percentages, mean, Standard deviation and regression analysis. The data for the study were derived from the distribution of 36 structured questionnaires for the chosen banks in Osun State, Nigeria. Two hypotheses were formulated and tested using regression analysis. The findings of this study showed that, there is a significant relationship between external audit and bank failure evidenced by p-value (0.001), p-value < 0.05%. It also discovered that there is a statistical significant relationship between audit failure and bank failure supported by p-value of (0.002), p-value < 0.05%. This study therefore concluded that early detection of problems that lead to bank failures by external auditors can save the bank s from distress and failure. The study recommends that banks audit system should reveal the weakness and the solutions to the bank problem. However, banks should provide all necessary information needed by the external auditor. Bank and other financial institutions should also ensure that external auditors are employed from reputable audit firms.


Keywords


Audit failure, Auditor independence, Bank Failures, External audit.

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Copyright (c) 2022 Oluwatimileyin Esther Adenle, Progress Onyekachi Anyanwu, Eucharia Ogechukwu Okafor, Olufemi Kolapo Oyaleke

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 ISSN (Print):   2695-2319

ISSN (Online): 2695-2327

 

 

   

 

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.