Seven commercial banks listed on the Nigerian Exchange Group have collectively paid a total of N1.39 billion to auditing firms in the first quarter of 2023. This payment reflects the importance of financial audits for ensuring transparency and accountability in Africa’s largest economy.
Publicly listed companies in Nigeria are legally required to subject their accounts to scrutiny and audit by independent auditors, commonly known as the “Big Four” – PwC, KPMG, EY, and Deloitte. This practice aims to ensure that the financial records of these companies are assessed objectively and without any bias or personal relationships that could cloud judgment.
The audit fees charged by these firms are influenced by various factors, including the size of the company, industry, corporate risk, profitability, and the duration of the audit process.
Among the surveyed banks, Access Holding Company topped the list in terms of audit costs, paying N606 million to PricewaterhouseCoopers (PwC). This amount represents a 41% increase compared to the previous year’s first quarter. Guaranty Trust Bank (GTCO) incurred N212 million in audit fees, slightly higher than the previous year.
Zenith Bank spent N212 million on audit fees in the first quarter of 2023, reflecting a significant decrease of 33.12% compared to the same period in 2022. Stanbic IBTC Holdings experienced an 18.3% increase, with audit fees amounting to N136 million in Q1 2023.
Union Bank witnessed a substantial 71.87% increase in audit fees, reaching N55 million in the first quarter of 2023, while Fidelity Bank saw a modest 4.35% increase, with N48 million spent on audit fees during the same period. Wema Bank, however, observed a 50.15% decrease in audit fees, amounting to N32.4 million in Q1 2023.
These audit fees reflect the ongoing commitment of Nigerian banks to ensuring the accuracy and reliability of their financial records. The payment of such fees is an essential investment in maintaining transparency and instilling confidence in the banking sector.
As the Nigerian banking industry continues to grow, the role of independent auditors becomes even more critical in safeguarding the interests of stakeholders and supporting sustainable economic development.