This study examines audit quality characteristics’ impact on financial statement fraud likelihood in Nigerian listed firms, using input-process-output factors and controlling for firm size and profitability. Panel design was adopted with a population of 151 firms listed on Nigerian exchange group as at 31st December, 2024. A sample of 110 firms was selected using Yamane formula and stratified random sampling was employed with System GMM applied as the estimation technique. The findings showed that from Audit Input angle, Audit tenure and firm size negatively but insignificantly affect fraud likelihood; audit independence positively insignificant. From Audit Process, Board size negatively affects fraud; board independence negative but insignificant; board meetings significantly positive. Lastly, Audit Output revealed that Audit committee independence and financial expertise significantly negative; committee meetings positively insignificant. It was recommended among others that financial regulators (ICAN, ANAN, FRCN) should standardize audit fees by company size and sector to ensure independence. Increase independent non-executive directors on boards and audit committees; raise financial/accounting experts in audit committees to enhance oversight and reduce fraud risk.
Keywords: Audit Quality, audit input, audit output, audit process, financial statement fraud
