THE ROLE OF EXTERNAL AUDITORS ON FINANCIAL ACCOUNTABILITY OF MANAGERS IN NIGERIA ORGANIZATIONS (A CASE STUDY OF UNION BANK OF NIGERIA PLC. AKWA BRANCH)

ABSTRACT

This study is aimed at finding and expressing the Roles of the External Auditors on financial accountability of managers in Nigeria organizations play in banks, using union bank as the case study

There has been significant attempt by the researcher to examine whether the various roles as should be carried out by audited the being introduced in banks and adopted as required by the guiding legislative.  The result of this study would aid, educate readers and  wise up banks on the roles of the external auditors play in banks.  

To accomplish the aim of this project work, the researcher has reviewed and reported some related literature sources such information were duly acknowledged in the appropriate reference sections.

About three hypothesis were formulated which were thereafter tested in other to establish theories of the end o the research study chi-square distribution were adopted for this test.  The some of data comes from both primary and secondary modes of data collection.  The secondary data forms the certain sages on which this project was based.

 Based on the data collected and analysis some findings made which was preceded by conclusion and some recommendation.  Suggestions were also made for further studies, summarily form the questionnaires administrated and data collected which were analyzed and interpreted, it has been generally concluded that role of auditors in banking operations have really contributed to the fairness and trueness of the financial reports and statements of banks and also check fraud in banks.

CHAPTER ONE

INTRODUCTION

An audit is the independent examination of, and expression of

Opinion on the financial statements of enterprises by an auditor.  In pursuance of this objective, he may disclose defalcations and irregularities, which are capable of impairing the truth and fairness of the financial statement.

In recent years there has been considerable debate over the extent of the statutory auditors responsibility for the detection of fraud.  This has been stimulated by the continued uncertainty over the extent of the auditors liability to third parties for negligent audit work.  It is obvious that failure to detect a major fraud may lead to a loss for the client or some third party to whom a duty of care is owned.  The important question is low far do the auditor’s responsibilities.

The auditing profession had always hold tight to the opinion that the primary responsibility for both prevention detection of fraud and other irregularities rest with management.  The auditor’s duties do not require him specially to search for fraud unless required by stature or the specific term of his engagement.  In accordance with normal practice, audit will be planned primary to enable us to express our professional opinion, and auditor merely obliged to plan his work and design his procedures so that he has a reasonable chance of detecting those, illegalness which might impair the truth and fairness of the financial statement.

PURPOSE OF THE PROBLEM

The aim of the study is to critically look or examined the

banking business in Nigeria and identifying the role the external auditors play in fraud detection.

It is well known that one of the problem facing banks in Nigeria is mismanagement of fund or inappropriate accounting for receipts and payments.  Based on the problem identified above, the objectives of the research work include: 

To highlight the need for appropriate review and report upon the accounts and balance sheet for banks by external auditors.

To educate on the necessity of banks to keep in mind the essence to comply with the provision of the bank and other financial institute decree, 1971.

To teach the banks to ensure compliance with the company and Allied Matters Decree (CAMD) 1990 as amended.

To educate auditors to land credence to the accounts of the bank and to ensure compliance with SAS to and IAS 30.

SIGNIFICANCE OF THE STUDY

To appreciate the overall significance of this research work,

one will have to put into consideration the roles of the external auditors of fraud detection.

In considering this, the importance of this study is dressed by the head to ascertain that banks keep up to the requirements of the banks.

It creates room for possible assessment of the banks financial reports enabling the entire public to receive what they bargained for, that is a true and fair received report.

Also the auditor’s role is established in the view to assessing in general the financial background of the banks dining at putting to a stop the issue of distress.

The government regulations on banks are being acknowledged by the external auditors, however making sure that they are continuously put of effect by banks.

The project will provide for any student carrying out a similar topic or further research work on this subject a solid foundation for the realization for his other research purpose or work.

The study is also in partial fulfillment of the requirement for the award of dgree in accountancy to the researcher.

PURPOSE OF STUDY

This study aims at assessing the internal audit as a subsystem of internal control being operated in the bank.  

i.  The purposes are outlined below

ii.  To aid good accounting system

iii. To eliminate wastage and losses

iv. To survey the external audit unit of union bank Plc. Head quarters      

    at  Victoria Island so as to review the predominant audit practice

      in the bank.

 v.   To point out deficiencies in the internal control system used by the bank.

vi.   To appoint out the implications of the system and suggest Recommendation that will bring improvement.

vii. To evaluate the expenditure procedure of the bank.

To ensure adherence management policies procedures, secure completeness and accuracy of record and safe guard all assets.

STATEMENT OF THE PROBLEM

It is a test to this research work to investigate on the positive

effects and influences the auditors, most emphatically the external auditors have financial organization like banks.

Auditing has the basic means to control the financial system of organizations still present fraudulent financial statements, financial and reports to the public and certainly there has been persistent gradient practice in the banks which at the end gets the banks distressed.

However, it could be questioned, how could this situation persist while auditing process had been in existence.  In carrying out his research work some problems have attracted special attention.

They are as follows: -

What have been the reasons for consistent fraudulent practices in the bank.

What are the identified reasons why most financial reports have not been and the other Financial Institution and Allied Mater Decree (CAMD), 1990.

To what extent should the external auditors play in banks to enhance the growth of the bank ad for the banks tokeep standard as required by CAMD.