If nothing is done to improve the issue, stakeholders’ trust in audited financial statements would deteriorate over time as they become unsatisfied with the audit profession’s job. The ‘heart-beat of a profession,’ according to Best, Buckby, and Tan (2001), is society’s trust. As a result, if such trust is lost or undermined in any manner, the result is likely to be skepticism and a reduction in the value ascribed to such a profession. Despite the fact that fraud detection is no longer one of the primary objectives of the auditing profession, according to PricewaterhouseCoopers’ 5th Global Economic Crime Survey (2009), fraud remains a pervasive business risk, with almost every firm being subjected to occupational fraud in their daily operations, resulting in huge losses for businesses and society. The audit profession is undeniably a social function that provides services to associated parties and is founded on trust between the professional auditor and those parties. Because other parties rely on the data included in the financial statement and audit reports produced by the auditor, the importance and responsibilities of auditing have grown in recent years. Despite the importance of the audit profession, it has been subjected to increased criticisms in the performance of its role and function, as a result of the challenges the accounting profession has faced a long time, the issue of Audit Expectation Gap (AEG) :which is the “difference between what the public and users of financial statements perceive the role of an audit.

The AEG has become a major concern because of the potential harm it may cause to the auditing profession, which is why it has grown in importance since it was first detected in the mid-1970s.

The audit expectations gap is defined by Pierce and Kilcommins (1996) as the difference between external auditors’ understanding of their function and responsibilities and the expectations of user groups and the general public. Furthermore, as we all know, audit refers to an accountant’s annual examination, correction, and official endorsing of financial accounts, particularly those of a business. However, the accounting profession in Nigeria has been under intense pressure due to rising public expectations as a result of a series of financial failures.

These financial failures occurred far too soon after the external auditors issued a “unqualified” audit report. In recent years, certain spectacular and well-publicized company bankruptcies, as well as the subsequent implication of the reporting auditors, have emphasized the audit expectation gap, according to Koh and Woo (1998). In reality, the unqualified opinion is mistakenly interpreted as a certification that the corporation or enterprise is solvent, liquid, and capable of adapting to environmental dynamics. Any subsequent corporate loss due to managerial errors, fraudulent practices, economic instability, inconsistency in micro and macroeconomic policies, and so on is considered as an auditor’s failure (Adeniji, 2004:510).

Furthermore, stakeholders frequently regard the audit as a discrete event, whereas in reality, the processes and controls that assure the audit’s overall integrity encompass much more than the audit opinion. These processes and controls cover everything from the company’s collecting and recording of financial data through the actual audit and financial report release. As a result, the audit quality determines the quality of financial reporting, which is crucial for investor confidence and transparency. The importance of a professional, independent view on a company’s financial accounts cannot be overstated. And simply knowing that an audit is coming, paired with the criteria and internal controls in place, has a quality-controlling, preventative effect. More than ever, business owners use the services of auditors to detect and prevent fraud. This could be owing to the ever-expanding nature of today’s enterprises. Clients want value added, not a vouching auditor who does the standard trade test (Nwokolo, 1998:25). Auditors are also known for their great integrity and objectivity, as well as their dedication to the public good. According to Hillier (2000), many clients increasingly demand them to deliver more services than only executing statutory audits and attesting to the financial statements’ veracity.


The global hunt for a solution to the audit expectation gap by auditors has intensified, and the auditing profession’s credibility appears to be at an all-time low. In the United States of America, the profession has lost its self-regulation status; as a response, the profession is bestirring itself, resulting in a flurry of new ideas and efforts targeted at closing the expectation gap. Some of the suggestions appear to be uncontroversial, while others appear to be banal. At the local level, the recent Cadbury Nigeria Plc controversy, in which profits were inflated by a considerable sum with the knowledge of auditors, and the following indictment of the accounting firm, appears to have widened the disparity as much as ever. Users of audited financial statements in Nigeria have criticized auditors, prompting a variety of responses from the profession and statutes. Users appear to have a distinct perspective on what auditing should include. The audit expectation gap has resulted from this. Many causes [communication issues and audit failures] have contributed to the establishment of this gap. In today’s evolving business climate, auditors’ responsibilities must be expanded to encompass fraud detection and prevention. Users also want to be able to make investment decisions based on audited financial statements. They also want the auditor to have complete independence, since they believe that without it, performance will suffer. Users may also have varied interpretations of the audit report’s nature and meaning.

It is impossible to overstate the importance of auditing in assuring the integrity and trustworthiness of financial data. Many countries’ canons mandate the attestation of financial statements by external auditors for this reason.

Unfortunately, there have been auditor criticisms that have arisen throughout time as a result of organizations that have failed. Users of audited financial statements in Nigeria have criticized auditors, prompting a variety of responses from the profession and statutes. Users appear to have a distinct perspective on what auditing should include. The audit expectation gap has resulted from this. Many reasons have contributed to the presence of this gap. Furthermore, the corporate environment is changing, and this has an impact.

Users also want to be able to make investment decisions based on audited financial statements. They also want the auditor to have complete independence, since they believe that without it, performance will suffer. The nature and content of audit report messages may also be interpreted differently by users. These are a few of the contributing elements to the audit expectation gap.

Finally, the accounting profession in Nigeria and other countries has been under intense pressure as a result of rising public expectations, which have been fueled in part by the failure of some financial institutions as a result of widespread financial scandals and false reporting rifle in these failed institutions, which has tarnished the organizational controls and professional auditors.



The overall goal of this research is to uncover and evaluate the involvement of auditors in the audit expectation gap in Nigeria.

The following specific objectives are derived from this overall goal:

Determine the components of accountability and dependability that lead to Nigeria’s audit expectation gap problem.
Determine the opinions of Nigerian auditors who are ICAN MEMBERS about the suggestions for closing the expectation gap.
Determine the audit beneficiaries’ and auditors’ perspectives on the statutory role of external auditors in Nigeria.
Examine the nature of the Audit Expectation Gap and financial statement users in Nigeria.
Understand the auditors’ and users’ perspectives on the auditing roles and functions in Nigeria.
Determine the Auditor’s role in the process.


The following hypotheses for the research project were established to meet the above aims, and the hypothesis were given in null forms.



Ho: There is no substantial association between audit expectation gaps and auditor responsibilities for fraud detection and prevention, as well as the soundness of the audited entity’s internal control framework.




Ho: Ho: Ho: On the statutory role of external auditors in Nigeria, there is no difference in opinion between auditors and audit beneficiaries.


The problem of audit failures has tended to increase the issue of audit expectation gap around the world. As a result, finding a solution has become a mad scramble. ICAN

MEMBERS, particularly auditors, are at the heart of this quest for a remedy. The motive for conducting this research in Nigeria is that auditors are often blamed for business failures, maybe due to a misunderstanding of auditing’s nature. The following will benefit from this research:

1. Audit clients: The findings of this study will help those who are audit beneficiaries. i.e. any organization that requires auditing services. They will have a better knowledge of the statutory objectives of external audit, lowering any unrealistic expectations.

2. Auditors: Those who assist in maintaining public confidence in financial accounts will be aware of the society’s expectations in order to safeguard their interests and remain relevant.

3. The Accounting Profession: Due to the changing nature of the business environment in Nigeria, it may be necessary to redefine the position of auditors in relation to AEG.


4. Scholars in auditing, forensic accounting, and related fields who push the boundaries of knowledge may profit from this research by generating research interests based on the findings. In addition, they would have a better knowledge of the audit expectation gap in Nigeria.


Academics will be ecstatic, as this work will pave the way for more research into other parts of this crucial issue.


The major goal of this research is to determine the involvement of auditors in the Nigerian audit expectation gap. Because there are so many factors that influence the audit expectation gap. The research was limited to auditors who are mostly ICAN Members selected from the Central Business District of Lagos metropolis, as well as a few stockbrokers selected from a list of brokerage companies that trade on the Nigeria Stock Exchange, in order to conduct a detailed analysis of the research study.

Difficulties are inevitable to arise in a research project of this scope. During the course of the research, the researcher encountered the following issues and limits.

As the researcher was focused on an area that had not been over-flogged, there was a scarcity of local literature. Another issue was money, which limited the researcher’s capacity to travel more extensively in quest of pertinent facts and opinions. Because of their hectic schedules, some professional auditors and stockbrokers rushed through the surveys, lowering the quality of their responses. In this study, time was of the importance, which had an impact on the researcher.

Overall, however, the researcher was able to successfully navigate through the difficulties and produce a work that will stand the test of time thanks to his extensive experience.


1. Audit Expectations Gap: The “expectations gap” is the disparity between what the general public and users of financial statements believe an audit’s job is and what the audit profession claims is expected of them throughout the audit (Ojo, 2006).

2. Auditor: A competent accountant who has additionally completed a professional examination is an auditor. Such a person must be of good character, with a broad knowledge base, and be able to comprehend a practical business, always attempting to grasp the technicalities, business practices, and techniques of any company whose account he is auditing.

3. External Audit: An external audit is one that is conducted by someone who is not employed by the company.

5. A quality audit is a method of systematically evaluating a product or service.

6. MEMBERS OF THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA (ICAN): These are members of the Institute of Chartered Accountants of Nigeria (ICAN).

7. Expectation: This term refers to how users of financial statements view the audit’s aim.


8. Gap: This refers to auditors’ inability to meet consumers’ expectations. The gap is caused by a misunderstanding of the auditor’s function and responsibilities, a lack of understanding of the message conveyed by the audit report, and unrealistic expectations regarding the auditor’s independence, according to this study.


9. Reliability factor: it expresses the degree to which the work of the auditors or audited statements may be trusted.


10. Auditor independence factor: this illustrates how much auditor independence affects the Audit Expectation Gap.

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