ABSTRACT

In this research the appraisal of auditor's independence which critically evaluate the variables impairing on auditors independence, the importance of auditors independence in Nigeria banking industry and also provide recommendation of solutions capable of addressing these problems. The emphasis was on Zenith Bank Nigeria Plc. The data used for this work were collected from both primary and secondary sources. The relevant data collected were analyzed using Pearson Moment Correlation. The results of the test show that auditor's independence affects the credibility of financial statement and that auditors non-compliance to act, code and conduct of professional ethics and statutory regulation affects professional practice thereby leading to manipulations in audit work. This study concluded that auditor's independence and the credibility of fmancial statement are significantly impaired when non-audit services are conducted and that there is a positive relationship between independence of an auditor and the credibility of financial statement. Finally, the study recommends that there should be rotation of auditors to improve the auditors independence, implementation of peer assessment in other to ensure that audit are carried out with outmost professionalism and mutual respect and that auditors should not be allowed to provide non-audit service and any other advisory services to client.