The Nigerian Audit and Assurance industry saw a massive revenue surge in 2024, with KPMG, Ernst & Young (EY), and PricewaterhouseCoopers (PwC) topping the list of earners.
The News Chronicles recently conducted research on the top 50 publicly quoted companies. Total audit earnings grew to N28.2 billion in 2024, up from N17.1 billion in 2023, a 65% increase year over year.
In today’s world of regulated and transparent businesses, the audit sector remains a critical pillar of trust and accountability.
For better context, these audits allow for independent assurance on the accuracy of financial statements, giving investors, regulators, and other stakeholders confidence and insights for decision-making.
Auditing has become increasingly important due to increased corporate scandals, worldwide compliance standards, and investor activism.
Audits help detect financial irregularities, promote good governance, and enhance financial transparency, all of which are necessary to develop investor trust and market stability.
The Big Four Dominates The Scene
As stated earlier, it is a clean sweep for the Big Four accounting firms KPMG, EY, PwC, and Deloitte. They collectively earned over N28.17 billion in 2024, more than 99% of the total audit fees reported.
- KPMG leads the list with N9.57 billion in 2024, a 75% increase from the N5.49 billion earned in the previous year.
- Ernst & Young (EY) follows with a N8.03 billion, an increase from N4.90 billion in 2023, and their biggest clients include GT Bank and UBA. They also handle audits for MTN NG, Nestle NG, Okomu Oil, Lafarge Africa, and others.
- PricewaterhouseCoopers (PWC) follows next, posting a N6.14 billion, compared to N3.51 billion in 2023. Their Clientele includes Stanbic IBTC, BUA Cement and Foods, PZ Cussons, and Zenith Bank, among others.
- Deloitte, last on the Big Four list, rounded up with N4.44 billion, almost doubling its 2023 figure. FCMB, Fidelity Bank, Aradel Holdings, Presco, Custodian Investment, and Transcorp are among their clientele.
- Firms like BDo, Baker Tilly, and Nexia Agbo & Co also made decent profits. However, they are focused on modest but consistent footprints, serving mid-sized companies.
An increased regulatory framework ensures growth
The 2020 Companies and Allied Matters Act (CAMA), together with the oversight from the Financial Reporting Council of Nigeria (FRCN) and the Institute of Chartered Accountants of Nigeria (ICAN), ensures a regulatory framework for audit processes.
However, one essential policy is the rotation of the auditor rule, which forces public interest entities (PIEs) to change their external auditors after every 10 years. This was designed to ensure the strength of the auditor’s independence, mitigate familiarity threats, and ensure a different perspective in the audit process.
Also, listed companies and regulated institutions, such as insurance companies and banks, are legally required to be audited by independent and licensed audit firms every year.
What’s Next For These Firms
The 2024 performance of these Audit Firms shows the continued importance of external audits, which promote corporate integrity and market stability.
With KPMG, EY, and PWC leading the charts and Deloitte showing massive strength, the dominance of these firms is still intact; other firms will struggle to break into it.
Looking ahead, as organizations face higher regulatory requirements and more complicated operational environments, the demand for comprehensive assurance and advising services will increase.
Going forward, the pressure for auditor rotation and increased scrutiny of non-audit services will influence how these companies structure their engagements and retain their independence in the Nigerian corporate sector.
