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Journal of Finance and Accounting. 2018, 6(1), 15-26
DOI: 10.12691/jfa-6-1-3
Open AccessArticle

Institutional and Block-holder Ownership and Audit Quality of Listed Manufacturing Firms in Nigeria

ABU Seini Odudu1, , NYOR Terzungwe2 and OKPANACHI Joshua2

1Department of Accounting, Faculty of Management Sciences, Federal University Dutsin-Ma, Katsina State, Nigeria

2Department of Accounting and Management, Faculty of Arts and Social Sciences, Nigerian Defence Academy, Kaduna, Kaduna State, Nigeria

Pub. Date: May 30, 2018

Cite this paper:
ABU Seini Odudu, NYOR Terzungwe and OKPANACHI Joshua. Institutional and Block-holder Ownership and Audit Quality of Listed Manufacturing Firms in Nigeria. Journal of Finance and Accounting. 2018; 6(1):15-26. doi: 10.12691/jfa-6-1-3


The credibility of audit quality adds value and assure investors that the investment in the company is secured. However, institutional and block-holder can affect audit quality positively or negatively. The study investigates the effect of institutional and block-holder ownership on audit quality of listed manufacturing firms in Nigeria. Logistic regression model was employed to analyze the data and test the hypotheses. Data were extracted from published audited annual reports and accounts of 32 firms that represent the sample size of the study out of the total of 59 firms. The results show that institutional ownership has negative and significant effect on audit quality while block-holder ownership has positive and significant effect on audit quality. This implies that institutional ownership reduces audit quality while block-holder ownership influences audit quality positively. The study conclude that both institutional and block-holder ownership affect audit quality and recommends that the proportion of shares acquired by institutions should be reviewed downward and that of block-holder ownership should be increased. This will encourage both institutional and block-holder ownership to put in their best to effectively monitor the quality of audit thereby give assurance and confidence to other forms of ownership in the manufacturing firms that their investments is secured.

institutional block-holder audit tenure firm size

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