DOES BOARD FINANCIAL EXPERTISE INFLUENCE THE RELATIONSHIP BETWEEN FINANCIAL ATTRIBUTES AND EXTERNAL AUDITOR CHOICE?

Authors

  • Adamu Adamu Idris Department of Accounting, Federal University Dutsin-Ma Katsina, Nigeria
  • Ibitoye Oyewale Olumide Department of Accounting, Federal University Dutsin-Ma Katsina, Nigeria
  • Hussaini Bala Department of Accounting, Banking and Finance, Tishk International University, Erbil, Iraq

DOI:

https://doi.org/10.32890/jbma2026.16.2.4

Keywords:

Financial attributes, auditor choice, service companies, board expertise.

Abstract

This study examined the moderating effects of board member accounting expertise on the relationship between financial attributes and external auditor choice among 17 listed service firms in Nigeria from 2014 to 2023. Using a longitudinal research design and correlational approach, the study investigated the influence of profitability, liquidity, and leverage on the choice of Big 4 versus non-Big 4 auditors. Board expertise, measured as the percentage of independent directors with financial expertise, was hypothesized to moderate these relationships. Data, sourced from the firms' annual reports, were analysed using descriptive statistics, correlation analysis, and logit regression. The findings revealed that higher board expertise is associated with a decreased likelihood of choosing a Big 4 auditor. In addition, the study found that board expertise moderates the relationship between profitability auditor choice. Likewise, the association between liquidity and external auditor choice, is moderated by board expertise. These results suggest that profitable firms are more likely to engage Big 4 auditors, and that board expertise plays a complex role in auditor selection, influencing and moderating the influence of key financial attributes. The study recommends that listed service firms should prioritize both strong financial performance and diverse board expertise, especially in financial reporting and risk management, for optimal auditor selection and corporate governance.

Author Biography

  • Adamu Adamu Idris, Department of Accounting, Federal University Dutsin-Ma Katsina, Nigeria

    Idris Adamu Adamu is a senior lecturer and faculty member in the Department of Accounting and the Faculty of Management Sciences respectively at Federal University Dutsin-Ma, Katsina Nigeria. He received his Ph.D. in Accounting from the Universiti Utara Malaysia. His research interests include corporate Governance, corporate finance, sustainability, and Taxation. Idris has published over 20 articles in various reputable international and local Journals. He is the pioneer and currently managing Editor of FUDMA Journal of Accounting and Finance Research. He is also a reviewer in various International and local academic Journals. More so, Idris is passionate about teaching and mentoring students of higher education.

     

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Published

31-07-2026

Issue

Vol. 16 No. 2 (2026)

Section

Articles

License

Creative Commons License

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

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How to Cite

DOES BOARD FINANCIAL EXPERTISE INFLUENCE THE RELATIONSHIP BETWEEN FINANCIAL ATTRIBUTES AND EXTERNAL AUDITOR CHOICE? (2026). Journal of Business Management and Accounting, 16(2), 194-205. https://doi.org/10.32890/jbma2026.16.2.4