Audit Committee Financial Expertise and Entrepreneurial Firms Reporting Quality in Nigeria

This Study examines the relationship between audit committee financial expertise and financial reporting quality among entrepreneurial firms in Nigeria, a segment of the economy in which weak governance structures and limited technical capacity have long been linked to unreliable financial disclosures. Adopting a conceptual and doctrinal approach grounded in agency theory and resource dependence theory, the Study synthesizes Nigerian and comparative international literature to clarify the meaning of audit committees, financial expertise, financial reporting quality, and entrepreneurial firms, before examining the qualitative characteristics, namely relevance, faithful representation, comparability, verifiability, timeliness, and understandability, that define reporting quality under the International Accounting Standards Board's Conceptual Framework. The analysis shows that audit committee financial expertise is generally associated with improved financial reporting quality, particularly through enhanced scrutiny of management's accounting judgments, reduced audit report lag, strengthened internal controls, and greater legitimacy with external financiers, but that these benefits are consistently moderated by the independence, diligence, and genuine engagement of committee members. The Study further highlights structural constraints specific to entrepreneurial firms, including founder reluctance to cede oversight authority, the cost of recruiting qualified experts, and the informality of governance practice, that can limit the practical realization of these benefits. The Study concludes with recommendations for entrepreneurial firms, regulators, professional bodies, financiers, and researchers aimed at strengthening the substantive, rather than merely nominal, financial expertise embedded within the governance structures of Nigeria's entrepreneurial sector.