Mandatory Audit Rotation and Audit Independence: Survey of Southern Nigeria

Abstract

The quest for mandatory audit rotation has been a concern to academics, investors, practitioners and the public at large. This study is designed to determine the relationship between mandatory audit rotation and audit independence in Southern Nigeria. The data used were collected through the distribution of questionnaires to investors, lecturers, consultants, accountants and auditors in Southern Nigeria.  Percentage analysis was used to analyze the data while the specified model was estimated using binary logistic regression technique with the aid of computer software Eviews 7. One hypothesis was stated and tested. The study revealed that mandatory audit rotation has a positive relationship on auditors’ independence. We therefore recommended that though audit rotation will improve auditors’ independence, rotation of external auditors should be made voluntary.

Keywords: Mandatory Audit Rotation, Audit independence, Southern Nigeria