ADEUSI, Sunday Amos
Adekunle Ajasin University
Akungba Akoko, Ondo State Nigeria
amos.adeusi@aaua.edu.ng
ABSTRACT
Credibility of information emanating from audited financial reports of corporate firms is germane to
stakeholders because it guides decisions-making. However, opportunistic behaviors of capital users,
especially in terms of earnings management in smoothing corporate incomes has called most financial
reports of firms to questioning. This study investigated influence of audit firms’ attributes on earnings
management of listed firms on Nigeria exchange group (NGX) for the period of thirteen years (2010-2022).
Ex post facto and quantitative research design was employed. Mixed-effects ML regression, correlation
matrix and descriptive statistics were used to dissect data collected. The results of the analyses revealed
that earnings management proxied by discretionary accruals was negatively affected by all attributes of
audit firms used in the study (audit firms’ size, joint audit, audit firms’ tenure ship and audit firms’ fees).
The study thus concluded that audit firms’ attributes have the capacity to cure or minimize income
smoothing by management; and recommends that capital owners that seek to mitigate capital users’ habit
of smoothing incomes should engage audit firms that possess the attributes covered in this study.
Keywords: Audit firms’ attributes, audit firms’ tenure, discretionary accruals, income smoothing