The study looked into the association which exists amid financial statement fraud and governance among business organizations in Nigeria. A population of 122 non-financial companies registered on Nigeria stock exchange was limited to 20 firms employing the rule of thumb based on stratified and simple random technique for a period of 2012-2016. The method of data analysis is panel regression. The dependent variable, fraud in the financial statement was measured using the Beneish M-score model while the independent variable was measured using audit committee independence, board structure. Findings show that an insignificant association exist amid audit committee independence, the composition of the board and financial statement fraud. This research design suggests regarding the reduction of the occurrence of financial statement fraud, less emphasis should be placed on audit committee independence, board composition and independent non-executive directors’ effectiveness.
This study examined audit committee attributes and audit quality with emphasis on the specific requirements of the 2011 SEC code. The study applied the deductive approach via the expost facto research design and the Binary probit regression model in analyzing the various hypotheses put forward in study. Data used for the study were gathered for 150 firm-year observations from the annual reports of quoted companies on the floor of the Nigerian Stock Exchange. Findings from the study revealed that audit committee size, frequency of meetings, number of expertise and overall effectiveness all have a positive relationship with audit quality. However, only size and overall effectiveness was significant in their relationship. The study recommends that since the significant positive nature of audit committee effectiveness show that four attributes jointly account for effectiveness, firms are encouraged to establish audit committees that have all these attributes. Furthermore, the requirement of having a 6-member audit committee is sound and empirically proven to aid audit quality. Therefore, firms yet to subscribe to these should hasten up, while sanctions should be made for firms that do not.
The financial debacles that occurred in the companies like Enron, WorldCom, and Xerox in the USA, Lehman Brothers, Polly Peck in the UK and African Petroleum Plc., Cadbury Plc., in Nigeria had created public distrust with the auditors. The era when the auditor will say 'trust me' and that being accepted is over. Now, they must earn the public trust. This study provides an empirical analysis of the scope and nature of audit expectation gap in Nigeria. We used a descriptive and survey research design to achieve the objective of the study. We also collected data through primary source, using structured questionnaire. The study used Mann-Whitney U test and Kolmogorov-Smirnov Z test for the analysis of data and test of normality of distribution, respectively. The results confirmed that audit expectation gap exists in Nigeria, and the new auditor's report did not have any serious impact in reducing the gap. From the outcome of this study, the audit expectation gap primarily arose from the unreasonable expectation of the users due to their lack of understanding of the roles of auditors. We recommend the launching of a new business-reporting model geared towards releasing more non-financial information to the public and with clear description of the role of independent audit.
This study examines the importance of the application of forensic audit in controlling financial frauds that ravage or threaten the soundness and business continuity of Deposit Money Banks (DMBs) in Nigeria. The study used survey design methods, and the primary data were obtained through the administration of structured questionnaire covering seventeen (17) banks out of twenty-two (22) Deposit Money Banks (DMBs) operating in the country, which is 77.3%. In this study, the Ordinary Least Squares (OLS) method was used to analyze and test hypotheses, and the findings showed that the involvement of qualified and experienced forensic auditors would not only contribute to the amelioration of financial frauds in DMBs, but would also lead to much-needed sanity in the banking sector of Nigeria. The study recommends that regulatory agencies, within the limits prescribed by law, mandate all the banks to create a special forensic department, managed by a professional forensic auditor, which will develop and constantly implement effective and efficient internal control, timely prosecution of fraudsters by considering them to be criminals and as a deterrent to others, and work out adequate training and development programs for their staff, especially in fraud control, in order to reduce the number of fraud cases in Nigerian banks.
The article aims to examine the effect of ownership structure on accounting conservatism among Nigeria listed firms. Correlational research design was employed in this study and the sample size comprises of all 15 firms from the banking sector listed on the Nigerian Stock Exchange (NSE) for the years 2013 – 2017. The study employed the panel regression technique to estimate the coefficients of the variables in the model specified. The study finds that there is a positive and insignificant relationship between managerial ownership and accounting conservatism; a positive but an insignificant relationship was observed between institutional ownership and accounting conservatism. However, foreign ownership revealed a negative but not significant relationship with accounting conservatism. We recommend that financial statements to include more detailed analysis of the structure of their ownership and shareholding to provide more information for decision making for users of the accounting information such as researchers and potential investors. Also, Regulatory bodies should ensure all companies comply with the concept of conservatism by imposing strict penalty on erring companies.
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