Audit Quality as a Determinant of Earnings Performance in Selected Nigerian Oil and Gas Companies

Earnings volatility remains a critical challenge for oil and gas companies, largely due to
fluctuations in global oil prices, geopolitical uncertainties, and rising exploration and
production costs. As the global energy landscape shifts toward renewables and regulatory
pressures to reduce carbon emissions intensify, the demand for accurate and transparent
financial reporting has become more pronounced. Despite the importance of financial reporting
in this sector, there is a notable gap in the literature regarding the empirical relationship
between audit quality and corporate earnings, particularly within emerging markets. This study
investigates the effect of audit quality on the earnings performance of selected oil and gas firms
listed on the Nigerian Stock Exchange. Employing a descriptive research design, the study
targeted directors and senior management staff of actively trading firms, selected purposively
as key stakeholders involved in financial decision-making. The findings reveal a statistically
significant and positive relationship between audit quality and earnings, with the audit process
identified as the most influential component. The study concludes that enhancing audit quality
particularly audit procedures can contribute substantially to earnings reliability. It recommends
that firms place greater emphasis on rigorous audit practices to improve financial transparency
and stakeholder confidence in the oil and gas industry.