This study investigated the impact of artificial intelligence (AI), external audit quality on
financial accountability of Deposit Money Banks (DMBs) in Lagos State, Nigeria. More
specifically, this study examined the elements of the level of AI, effectiveness of AI in fraud
detection, reliability and accuracy of the audit, as well as timeliness and efficiency of the
audit, and the impact of these elements on financial accountability. Guided by Agency
Theory, the study employed a survey research design. External auditors and audit specialists
working in the four largest international audit firms (PwC, KPMG, EY and Deloitte) in Lagos
were surveyed, and 912 usable responses were collected. Data were analyzed using
descriptive statistics, reliability analysis using Cronbach’s alpha, and simple and multiple
regression analyses. The outcomes of the study revealed that the four model’s independent
variables had a positive and significant influence on financial accountability with a
confidence level of 95%. The level of AI adoption (β = 0.591, R² = 0.541), effectiveness of AI
in fraud detection (β = 0.624, R² = 0.573), reliability and accuracy of the audit (β = 0.573,
R² = 0.502), and timeliness and efficiency of the audit (β = 0.558, R² = 0.487). The combined
model was significantly high (R² = 0.714, F = 558.46, p < 0.05) and accounted for 71.4% of
the variance in financial accountability in which the effectiveness of AI in fraud detection was
the strongest of the four variables. The study found that the use of AI in external auditing
strengthened financial accountability in Nigerian Deposit Money Banks (DMBs). It suggested
the banks should allocate more resources toward the development of AI-based fraud
detection systems and real-time auditing. It is recommended that the Central Bank of Nigeria
(CBN) establishes a policy framework that balances the need to enhance the accountability of
banks and the development of responsible AI in auditing.
Tosin Olayemi Adeeko, A. O. Ayodele· Journal of Accounting and Fi...· 0 citations
In Nigeria's banking sector, poor financial reporting is often linked with fraud, regulatory
punishments, and poor internal control. This study assessed consolidated internal control
systems: the five components of COSO (control environment, risk assessment, control
activities, information and communication, and monitoring), and financial reporting quality
and the regulatory compliance moderating variable, in selected DMBs in Lagos State,
Nigeria. A survey design and a census of 22 DMBs of both international and national
authorizations were employed. The study aimed at 264 internal auditors, compliance officers,
finance managers and risk officers. A total of 226 questionnaires (response rate: 85.6%)
were returned and filled. The questionnaires had a 5-point Likert scale. The collected data
were analyzed using descriptive statistics, Pearson correlation, and regression analysis
which included regression diagnostics, simple, multiple and hierarchical regression analysis.
The study found that all five components of COSO had significant positive effects on the
quality of financial reporting. Control environment (β = 0.491), risk assessment (β = 0.521),
control activities (β = 0.571), information and communication (β = 0.456), and monitoring
activities (β = 0.502), all had p-values less than 0.001. Control activities had the strongest
positive effect. The five components of COSO combined were significantly good predictors of
financial reporting quality at 44.6% adjusted R2. R² = 0.446, F = 37.84, p < 0.001).
Regulatory compliance positively and significantly moderated the internal control–financial
reporting quality relationship (interaction β = 0.324, ΔR² = 0.044, p < 0.001), and the
variation increased to 55.8%. The study concluded that internal control components
positively contributed to reporting quality and that strong regulatory compliance
significantly improved this contribution. The study recommends that banking organizations
should increase focus on control activities, and strengthens the whistleblowing mechanism in
their organizations to serve as measure of internal control mechanism within their
organizations
Akinniyi Aderonke Funmilayo, A. O. Ayodele· International Journal of Eco...· 0 citations
This research investigates the impact of components of corporate governance, the disclosure
of liquidity risk, and the financial performance of Deposit Money Banks (DMBs) quoted on
the Nigerian Exchange Group (NGX). The study is motivated by the persistent problems of
fragility of the banking sector which have continued to exist despite regulatory reforms. In
this study, corporate governance is broken down to include mechanisms at the board level
(Corporate Governance Index - CG) and mechanisms at the committee level (Audit/Risk
Committee Mechanisms - ACM). In addition, liquidity risk disclosure is broken down to
include quantitative disclosure (QDIS). The study adopted an ex post facto research design
with a longitudinal approach. The study covered a ten-year period (2016–2025) and included
seven listed DMBs, which provided a total of 70 bank-year observations. Fixed-effects panel
regression analyses were applied, while leverage was included as a control variable. The
financial performance of the banks was evaluated using ROA and Tobin’s Q. The findings
indicate that CG had a positive and significant effect on Tobin’s Q (p=0.0174) but not on
ROA, while QDIS showed a highly positive and significant effect on Tobin’s Q (p=0.0003)
but no significant effect on ROA. ACM had no significant effect on both performance
measures. In the joint model, CG and QDIS were the only statistically significant predictors
of Tobin’s Q (Adjusted R²=0.2678, p=0.0011) while ACM remained statistically
insignificant. The study establishes that corporate governance and the quantitative disclosure
of liquidity risk were the significant predictors of the market-based performance of the banks,
with disclosure being the dominant control of bank valuation. The study recommends to
improve the quality of boards of directors, increase quantitative liquidity disclosures beyond
the level required by regulations, and provide more tailored regulations to clarify the
distinction of the board and committee functions. The study adds to existing literature by
breaking down the components of governance and disclosure and providing evidence of the
Nigerian banking sector after the reforms.
Giwa, Adetoun Fatimoh, A. O. Ayodele· Journal of Accounting and Fi...· 0 citations
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