Abstract
This
study examines forensic accounting and corporate performance of firms listed on
the Nigerian stock exchange. Its main objective is to examine if there is any
relationship between forensic accounting and corporate performance in Nigeria.
The primary source of data collection was used in gathering data from
respondents. A structure questionnaire was designed by the researcher and validity
by two experts from the statistics department was used to obtain data
Chi-Square (X2) was used to test hypotheses formulated. It was
discovered that most quoted companies in Nigeria do not engage the services of
forensic accountants. The study concludes that there is a great need for
forensic accounting to ensure efficient and effective corporate performance in
Nigeria and it was recommended among others that forensic accounting should be
equipped with necessary skills and knowledge in fighting computer related
fraud/e-crimes.
TABLE
OF CONTENTS
Title
Page
Certification
Dedication
Acknowledgements
Abstract
Table
of content
Chapter One:
Introduction
1.1
Background to the Study
1.2
Statement of Problems
1.3
Research Questions
1.4
Objectives of the Study
1.5
Statement of Hypothesis(es)
1.6
Significance of the Study
1.7
Scope of the Study
1.8
Limitation of the Study
1.9
Definition of Terms
Chapter
Two: Review of Related
Literature
2.1 Introduction
2.2 Meaning
of Forensic Accounting
2.3 Scope of
Forensic Accounting
2.4 Forensic
Accounting and Auditing
2.5 Functions
of Forensic Accounting
2.6
Importance of
Forensic Accounting Services in Nigeria Quoted Companies
2.7 Problems of Forensic Accounting
2.8
Possible
Remedies to the Problems of Forensic Accounting
2.9 The Forensic Accountant
2.10 The Role
of a Forensic Accountant in Solving the Vexed Problem of Corporate World
2.11 Qualities
of a Forensic Accountant
2.12 Duties
and Responsibilities of a Forensic Accountant
2.13 Procedure
for Conducting the Work of Forensic Accounting
2.14 Forensic
Accountant in the Audits
2.15 Financial
Statement Fraud
2.16 Prevention
and Detection Strategy of Financial Statement Fraud
2.17 Fraud
Under Review
2.18 The Fraud
Triangle for Forensic Accounting
2.19 Role of
Information Technologies to Perform Computer Related Fraud
2.20 Forensic
Information Technology (IT)
Chapter
Three: Research Method and Design
3.1
Introduction
3.2
Research Design
3.3
Description of Population of the Study
3.4
Sample Size
3.5
Sampling Techniques
3.6
Sources of Data Collection
3.7
Method of Data Presentation
3.8
Method of Data Analysis
Chapter
Four: Data Presentation, Analysis and Interpretation
4.1 Introduction
4.2 Presentation of Data
4.3 Data Analysis
4.4 Hypotheses Testing
Chapter
Five: Summary of Findings, Conclusion and Recommendations
5.1
Introduction
5.2 Summary of Findings
5.3
Conclusion
5.4
Recommendations
References
Appendices
CHAPTER ONE
INTRODUCTION
1.1
Background to the Study
Historically,
Forensic Accounting is certainly not a new field, research findings have shown
that the profession has been in existence a long-time ago. For example, in
ancient Egypt, the officers in charge of Pharaoh’s grains, gold and other asset
were called the “eyes, and ears’ of pharaohs’.
Criminally,
in Nigeria, ‘corruption and other financial and economic crimes is the base of
Nigerian development efforts. Corruption bestrides the lives of the citizen.
The judgment of transparency international is a reflection of what the nation
has given to the world 419, money laundering, illegal oil bunkering etc. Ribadu
(2004) stated that all these crime continued in Nigeria system in spite of
government landscape steps to address them, because many people in power want
the old dispensation to continue. He reiterated that there are those even
though they are paid to check the activities of the culprits, yet are willing
to share in the proceeds with the event that they themselves become culprits.
These economic and financial crimes are the greatest threat to Nigeria economic
and developmental growth as the nation has nothing to show for its huge
earnings from oil.
Also,
Waziri (2009) stated that corruption afflicts virtually all parts of the
Nigeria society. In its 2004 report on worldwide corrupt practices transparency
international survey which covered 146 countries in the world, which rated
Nigeria as the third most corrupt country in the world. The focus of the
transparency international 2004 report was more on oil sector as a revenue
source for most oil producing countries.
According
to Owolabi (2007), chairman of Transparency International Board of directors
observed in 2004 that in oil producing countries, public contracting in the oil
sector is plaque by revenue vanishing into the pockets of western oil
executives, middlemen and local officials. He suggested that oil companies
could help fight corruption by making public details of payment made to
government and state-controlled oil firms. More also, the growth of public
limited liability companies and large increase in the number of investors, and
the divorce of ownership from control of companies has called for regular
forensic accounting work of corporate financial reports in Nigeria.
Several
instances of corporate scandal and failure in resent past have put professional
accounting bodies into a new perception that goes beyond statutory audit and
the trend of corporate governance or performance.
Furthermore, modern organized corporate frauds are widely spread and well
resources by manager, entrepreneur and politicians. Therefore, there is need to
respond to this changing criminal threat by the Accountant and legal experts
also needed to combat the corporate challenge, this has arouse the call for
forensic accountant in enabling corporate performance in Nigerian companies.
1.2
Statement of Problem
This
project is to address some of the deficiencies by looking towards a forensic
accountant as the best antidote to curbing financial and economic crimes, and
also to prevent and reduce misappropriation of corporate funds. Also, the
failure of statutory audit to prevent and reduce this misappropriation of
corporate funds and increase in corporate crimes has put pressure on
professional accountant and legal practitioners is to find a better way of
exploring fame in business world. A nation-wide study conducted by Kessler
international showed that 39% of organizations have considered the need for a
forensic accountant.
1.3 Research
Questions
The
following research questions are raised in order to achieve the objectives of
this study.
1.
Is there any relationship between
forensic accounting and corporate performance in Nigeria?
2.
How can the practices of forensic
accounting play an important role in solving the vexed problems in a company’s
corporate performance?
3.
To what extent can public confidence
and trust be restored through the practices of forensic accounting and
corporate governance in Nigeria?
4.
To what extent is the level of
awareness of forensic accounting practices in Nigeria?
5.
How can the application of forensic
accounting detect and minimize computers related fraud or e-crime in Nigeria
companies?
6.
How can the application of forensic accounting
services in quoted Nigeria companies detect fraudulent activities?
7.
Can the credibility of audited
financial statement of quoted Nigeria companies being undermined?
1.4 Objectives of the Study
1.
To examine if there is any
relationship between forensic accounting and corporate performance in Nigeria.
2.
To evaluate how the practices of
forensic accounting could play an important role in solving the vexed problems
of a company’s corporate performance.
3. To evaluate how forensic accounting and
corporate performance can provide professional investigative and litigation
support services in Nigeria.
4.
To ascertain the level of awareness
of forensic accounting practices in Nigeria.
5.
To determine the extent at which
forensic accounting practices detect and minimize computer related fraud or
e-crimes in Nigeria companies.
6.
To determine whether the application
of forensic accounting services in Nigeria quoted companies can detect
fraudulent activities.
7.
To ascertain whether audited financial
statement in quoted Nigeria companies are being undermined.
1.5 Statement of Hypotheses
The
following null and alternative hypotheses have been formulated to serve as a
base for this research.
Hypothesis
One
Ho:
There is no significant relationship
between forensic accounting and good corporate performance.
HI:
There is significant relationship
between forensic accounting and good corporate performance.
Hypothesis Two
Ho:
Litigation support services by forensic
accounting cannot lead to appropriate judgment for economic and financial crime
eradication in Nigeria.
HI:
Litigation support service by forensic
accounting can lead to appropriate judgment for economic and financial crime
eradication in Nigeria.
Hypothesis Three
Ho:
Forensic accounting practices cannot
assist in the detection or minimization of computer fraud or electronic related
fraud.
HI:
Forensic accounting practices can help
eradicate computer fraud or e-crimes in Nigeria quoted companies.
Hypothesis Four
Ho:
Forensic accounting and extent of fraud
detection are not in any way related.
HI:
Forensic accounting and extent of
fraud detection are positively related.
Hypothesis Five
Ho:
Forensic accounting cannot help to
ascertain the level of credibility of audited financial statement.
HI:
Forensic accounting has a major role
to play in ascertaining the level of credibility of audited financial
statement.
1.6 Significance of the Study
The
significance of this study is to corporate companies, investors, Nigeria
government, and the general public. The study will educate these groups on the
importance of a forensic accountant and corporate performances among them
thereby help to restore the lost confidence by the public and the government as
regard forensic accountant and corporate performance in Nigeria.
The
study will also be beneficial to academicians and other future
researchers/users in similar subject matter.
1.7
Scope of the Study
The
area of coverage is restricted to Nigeria situation by the use of questionnaire
and direct interview. Also covers a survey of quality corporate management and
control in forensic accounting services in Nigeria. This study is undertaken to
evaluate the impact of forensic accountant and corporate governance within
Nigeria geographical states. The study limit itself to some quoted firms in the
Nigeria stock exchange (NSE), with special emphasis on the impact it can have
on restoring the credibility of audited financial statements of companies, as
well as fight against corruption and computer related frauds in Nigeria and it
is between the period of 2010-2013.
1.8
Limitation of the Study
There
is no study undertaken by a researcher that is perfect. This could be as a
result of some constraints that affect the researcher in the course of the
study. The limitation of the study is concerned with those constraints which
could come up in the course of the project work. Some of these constraints are,
1. Inadequate research materials.
2.
Inadequate primary data. This is the
means of getting first hand information about the subject matter.
3.
Policy of the respondent
company/individual e.g. different depreciation method used will seriously
affect the research data.3
1.9 Definition of Terms
·
Investigation: The
use of specialized investigative skills in carrying out an inquiry conducted in
such a way that the outcome will have application of the law.
·
Forensic Accounting: Is
defined as the practice of vigorous data collection and analysis in the area
-of litigation support consulting, expert witnessing, and fraud examination.
·
Forensic Audit: This
refers to the examination of all evidence regarding an assertion to ascertain
its correspondence to establish criteria carried out, in a manner suitable to a
law court.
·
Litigation: This
simply means the judicial process of, carrying out legal context.
·
Electronic Crimes: Are
crimes committed through the use of information technology (I.T)
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