Financial Reporting Quality at Public Universities in Southwest Nigeria

Abstract

To help investors make timely and cost-effective judgments, financial reporting quality has been a pertinent topic of discussion in the global business community. It assists users in public organizations in selecting the best method for utilizing relevant accounting data. Research in the literature revealed that incidences of fraud and a lack of accountability result in subpar financial reporting, which undermines investor trust and shapes investment choices. Research indicates that a large number of colleges fail to incorporate audit quality into their daily operations in an effort to improve financial reporting standards. As a result, this study looked at the connection between financial reporting quality and audit quality at many public institutions in southwest Nigeria. In this study, survey research approach was used. Twelve of the nineteen public universities in southwest Nigeria that were included in the study were selected through the use of purposeful sampling. A total of 250 employees who worked in senior management, audit, and finance made up the target population. A sample size of 201 was calculated using the Taro Yamane formula. There were 201 copies of the validated structure questionnaire distributed to the participants. Ninety-four, or 94.5 percent, were recovered. The reliability coefficients for Cronbach's Alpha varied from 0.724 to 0.991. The data were analyzed using both inferential (multiple regression) and descriptive statistics. The results of the study showed that audit quality had a significant impact on the following: financial report timeliness (Adj. R2 = 0.516; F(201) = 43.597=; p=0.00); financial report faithful representation (Adj. R2 = 0.598; F(6, 183) = 47.930=; p=0.00); financial report understandability (Adj. R2 = 0.416; F(6, 183) = 21.735=; p=0.00); and the comparability of financial report quality (Adj. R2 = 0.390; F(201) = 21.102=; p=0.00). The study came to the conclusion that financial reporting quality at public universities in southwest Nigeria is influenced by the quality of audits. To improve the caliber of financial reporting, the study advised public entities to include audit quality into their daily operations.