CHAPTER ONE
INTRODUCTION
1.1
Background
of the Study
Government
organization have played a greater part in
the economic growth of any economy, especially in the
Nigerian economy. The contributions they have made so far cannot be
overemphasized because their utmost aims of establishment is to provide some
vital or essential services to improve the social and economic well being of
the people.
These government organizations are mainly being funded
either by the federal or state government through their budgetary allocations
made to them yearly and they can also obtain loans or overdraft from commercial
bank as well as subvention from government. These funds are expected to be
utilized effectively and efficiently. But in most practices they are being
misappropriated or embezzled by some government officials.
As a result of this mis-appropriation which has
characterized most of the government organizations. Honestly and prudently
managed. The audit is expect to
show whether proper principles of accounts and audit
ethics have been adhered to and that financial statements prepared give a true
and fair view.
1.2
Statement
of the Problem
In any business Organization in which allocation and
application of funds serves as a backbone for financial activities to be
carried out the following are problems in which are bund to be encountered.
1.
Embezzlement of fund by some
government Officials
2.
Failure
to exercise due professional care and the appropriate level of professional
skepticism.
3.
Overreliance on inquiry as a form of
audit evidence
4.
Deficiency in confirming accounts
receivable
5.
Failure to recognize related party
transactions and
assuming internal control exist when they may not. These
and other factors contribute to problems of auditing in government
organization.
1.3
Purpose
of the Study
importance, problems and
prospects of auditing
in
government institution.
§ To ascertain the problems encountered
while auditing in government establishment.
§ To know if auditors exhibit enough
professional competence in conduct of their work.
§ To know how effective auditing is in
government establishment
1.4
Research
Questions
This research work
seeks to ask
the following questions
among others, deduced from the purpose of the study.
§ Are auditors being threatened or
intimidated during their audit work.
§ Are auditors being faced with some
problems during their audit work.
§ Are vital documents needed for the
audit of the organization being held from the auditors
Based on
the purpose, and research questions the following hypothesis are put forward.
Ho Financial
reports submitted are not in consonance with
the transactions
carried out by
the government
establishment
HI Financial report submitted are in
consonance with the
transactions carried out by
the government
establishment.
Ho Treats and intimidation
do not positively
affect the
quality
of auditors work in government establishment.
HI Treat and intimidation positively affect
the quality of
auditors
work in government establishment.
Ho Poor professional conducts by auditors do not affect
the quality
of work done
by auditor in
government
establishment.
HI Poor
Professional conduct by
auditors affects the
quality of work
done by auditors
in government
establishments.
Where
audit principles and procedures are carried out in government organizations the
following benefits are derived of which these work will be beneficial to the
following people and establishments:
§ Government good audit work will
prevent, expose fraud, errors and irregularities in government
establishment.
§ Auditors: will benefit by knowing the
challenges facing them in their audit work and thereafter the prospects.
§ Banks; will also benefit because it
will give them insight on how to handle audit work successfully.
§ Students and researchers will benefit
by gaining knowledge on the audit challenges to banks and the
prospects.
1.7
Scope
and limitation of the study
This project would cover arrears such as audit
principle(s) and procedures giving as in depth analysis on how audit work is
carried out in government organizations.
Attempts have been made by the researcher to discuss in
depth the various short comings behind this operational framework of auditing
in government organization and also self investigation carried out.
Part of the constraint encountered by the researcher and
limitations are as follows.
§ Cost of carrying out the research
§ Short duration of time limit
dedicated on the project
§ Distance and financial constraint.
§ Restriction placed upon by some
organization to have access to some vital documents.
§ Secrecy maintained by some government
officials by not revealing certain information which they term as
“Keep government secrets secret”.
1.8
Definition
of terms
Fraud: Is a mis-presentation of data with the intention to
theft which is dishonest act involving the theft of assets and the
falsification of accounting records and financial statements (Akpankpan,
2000.126)
lawfully in one‟s custody, (Kohther, 1970:173)
Auditing or Audit: Is concerned with an independent
examination of financial statements and accounting records by an independent
certified or chartered accountant and expression of an opinion by the public
accountant on the financial statements of an organization stating whether the
finance; al statements present fairly by the financial position of the firm
concerning the period covered by the financial statement.
Auditor: An auditor is the qualified accountant who is
professionally licensed to audit or examin financial sttments or report of
business or non-business organizations.
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