AUDITORS' OPINION AND THE VALUE OF COMPANIES IN THE NIGERIAN FINANCIAL SERVICES INDUSTRY: THE MODERATING ROLE OF FIRM SIZE

This study examines the effect of audit opinion attributes on firm value in the Nigerian financial services industry, with a focus on Audit Opinion Type (AOT) and Going Concern Disclosure (GCD). The study further investigates the moderating role of firm size in shaping the relationship between audit signals and firm value. Firm value is proxied by Tobin’s Q and Market Price Per Share (MPS), capturing both long-term valuation and short-term market response. The study employs an ex-post facto research design using balanced panel data from listed financial services firms on the Nigerian Exchange Group (NGX) over the period 2014–2025. Panel regression techniques, supported by fixed effects estimation, were used to analyse the data. The empirical results reveal that Audit Opinion Type has a statistically significant positive effect on both Tobin’s Q and MPS, indicating that clean audit opinions enhance investor confidence and firm valuation. Conversely, Going Concern Disclosure exhibits a significant negative effect on both measures of firm value, suggesting that audit signals of financial distress are strongly penalised by the market. Firm size is also found to have a significant positive direct effect on firm value. Furthermore, the interaction effects show that firm size strengthens both the positive impact of clean audit opinions and the negative impact of going concern disclosures, implying that larger firms experience more pronounced market reactions to audit signals. The study concludes that audit opinions are value-relevant informational signals in emerging capital markets, and their effects are conditioned by firm characteristics such as size. The findings support Signaling Theory, Agency Theory, and Lending Credibility Theory, and contribute to the literature on audit quality and market-based performance measures in developing economies