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ABSTRACT
External auditors have been identified by researchers to have an immeasurable role in enhancing
the earnings quality of companies. However an important audit attribute which is industry
specialised auditor have not been considered in the non financial sector in Nigeria and available
literatures in this area have not considered the consumer goods sector in Nigeria. Therefore this
study investigates the effect of audit firm attributes on earnings quality of listed consumer goods
firms in Nigeria. Earnings quality is the dependent variable while industry specialized auditor,
audit compensation, audit tenure and audit firm type are the independent variables. Data for the
study were obtained from the audited annual report of the 13 sampled consumer goods firms for
a period of 8 years covering 2007 to 2014. The study employed ordinary least square regressions
as tool for analysis. The result shows that industry specialized auditor and audit firm type (Big4)
have significant positive influence on earnings quality of listed consumer goods firms in Nigeria,
however audit tenure and audit compensation have no significance influence on earning quality
of the firms. For consumer goods firms to achieve higher earnings quality and provide quality
financial information for effective decision making, it is therefore recommended that they should
employ the services of industry specialized auditor and big four audit firm type who have the
capability of influencing the quality of earnings of the company.
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