Mediating Effect of Audit Quality on the Relationship between Corporate Governance Mechanisms and Accrual Earnings Management

(Pages 1654-1664)

Umar Aliyu Mustapha1,*, Norfadzilah Nik Mohd Rashid2, Hussaini Bala3 and Abba Ya'u4
1Faculty of Accountancy, Universiti Teknologi MARA Cawangan Selangor, Bandar Puncak Alam, Selangor, Malaysia.
2Faculty of Economics and Management Sciences, University Sultan Zainal Abidin (UniSZA).
3Department of Accounting, Banking and Finance, Faculty of Administrative Sciences and Economics, Tishk International University, Erbil Kurdistan Region-Iraq Il.
4Department of Accounting, Finance, and Economics. Faculty of Business. Curtin University Malaysia.


Regardless of the significance of the corporate governance mechanisms and audit quality in observing earnings management, the results of prior studies have been conflicting, and the majority of the investigations have been carried out in both developed and developing nations among which Nigeria has many differences with them. However, the financial calamities in Nigeria are increasing due to the need for looking at the indicators of earnings reliability as the major factor. This study's main objective is to examine the mediating effect of audit quality on the association between corporate governance mechanisms and earnings management using the four causal stages of Baron and Kenny's assumptions for mediation. Thus, the study reported all relevant mediation model results, hence, it only considered the mediating relationship. The study used all listed firms in the Nigerian stock market from 2017 to 2021 financial year. The data was collected from secondary sources of data streams, annual reports, and accounts of the firms. The data were analyzed using multiple regression after all necessary diagnostic tests. However, seven variables of corporate governance were employed and only three of Board Size, Board Independence and Audit Committee Gender certified the conditions of mediation and four of Board Gender, Audit Committee Size and Audit Committee Accounting Expertise failed. The finding of this study highlighted to what degree the audit quality effect is mediating the mansion relationship which contributed to the relevant literature. It also provides a basis on which practitioners, corporate managers, and all users of financial reports can make a rational investment decision in Nigeria and across the globe.


Audit Quality, Corporate Governance, Earnings Management, Nigerian, Listed Companies.

How to Cite:

Umar Aliyu Mustapha, Norfadzilah Nik Mohd Rashid, Hussaini Bala and Abba Ya'u. Mediating Effect of Audit Quality on the Relationship between Corporate Governance Mechanisms and Accrual Earnings Management. [ref]: vol.21.2023. available at:

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