FORENSIC AUDITING AND PRODUCTIVITY OF NIGERIA CIVIL SERVICE

BY

AMAH, KINGSLEY CHINENYE

FUO/14/ACF/1055

PROJECT SUBMITTED

TO THE DEPARTMENT OF ACCOUNTING,

FACULTY OF MANAGEMENT SCIENCES,

FEDERAL UNIVERSITY OTUOKE.

IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF

BACHELOR OF SCIENCE (B.Sc) DEGREE

IN ACCOUNTING

SEPTEMBER, 2018.

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 DECLARATION

I hereby declare that this project is my original work and it has not been submitted anywhere for

the purpose of awarding a degree.

Amah Kingsley Chinenye

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 CERTIFICATION

The Department Board of Accounting, Faculty of Management Sciences, Federal University

Otuoke, Bayelsa State, hereby certify that this project was carried out by AMAH KINGSLEY

CHINENYE and is being accepted in partial fulfillment for the award of Bachelor of Science

(B.Sc) degree in Accounting of Federal University Otuoke, Bayelsa State.

------------------------------------- ------------------------------------
Dr. Ifeanyi Madumere Date
(Project Supervisor)

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Dr. Ifeanyi Madumere Date
(Head of Department)

------------------------------------- --------------------------------------
Prof. Barnabas Agbonifoh Date
(Dean, Faculty of Management Sciences)

------------------------------------ -------------------------------------
External Examiner Date

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 DEDICATION

This research project is dedicated to God Almighty, Who endowed me with wisdom and

knowledge.

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 ACKNOWLEDGEMENTS

My favorite thanks goes to God Almighty for his guidance and sustenance throughout my

academic journey.

My heartily gratitude goes to my family, Elder Simeon Nwekwe Amah, Evangelist(Mrs.) Stella

Nwekwe Amah, Mr. Solomon Nwekwe, Ms Edith Nwekwe, Mr. Jude Amah, and Mr. Stanley

Amah for their immense support throughout my academic period.

My sincere appreciation goes to my project supervisor and Head of Department, Dr. Ifeanyi

Madumere for his devotions, encouragement and valuable contributions leading to the successful

completion of this work.

I cannot forget in a hurry, the immense support given to me by my course-mates most especially

Malafakumo Ugo in the department.

I appreciate the CEO of Libracin Natural Medicine Ltd, Dr. Anyatonwu Bestman, and Elder

Shonuga of ECWA (Evangelical Church Winning All) English Aba for their support and

encouragement.

I acknowledge my lecturers, fellow students, authors of the published books, articles and papers,

Quincy Printing Press, BIJ Engineering and host of others too numerous to mention whose

contributions has helped in the production of this work.

I pray that Almighty God will bless and reward their efforts.

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 ABSTRACT

The study examined Forensic Auditing and Productivity of Nigeria Civil Service. The survey design was
adopted in generating the necessary data. Population of the study consisted of 180 staff of Abia State
Civil Service Commission. The sample of the study was 124 staff of the above stated commission which
was arrived with the aid of Yaro Yamene model. In order to gather the data for the study, a structured
questionnaire was administered on the staff of Abia State Civil Service Commission. Based on the field
work, only 92 questionnaires were retrieved. The data generated for the study were analyzed with
frequencies and percentages while the tested hypotheses were specifically tested with the regression
technique, which was computed with the aid of the statistical packages for social sciences (SPSS) version
22. The findings of the study indicated that forensic auditing have a positive significance relationship with
fraud minimization and effective internal control system. However, forensic auditing has a positive non-
significance relationship with civil service performance. Based on the above, it was recommended that: 1)
Forensic auditors should be engaged by the government to examine and address allegations of fraud and
misconduct in the Nigeria civil service. 2) Government should be focused and performance-driven to
initiate reforms based on forensic audit report, in order to advance the productivity and efficiency of the
Nigeria civil service. 3) Forensic audit department should be created in government
ministries/departments/agencies to complement the work of internal auditors in enhancing the
effectiveness of internal control system. 4) Forensic audit report on government institutions should be
made available to the relevant legislative bodies at all government levels, and as well to the general public
through the media and internet in order to serve as a deterrent to fraudulent practices in the Nigeria civil
service.

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 TABLE OF CONTENT

Title Page

Title Page…………………………………………………………………..... 1

Declaration…………………………………………………………………... 2

Certification………………………………………………………………..... 3

Dedication…………………………………………………………………… 4

Acknowledgement…………………………………………………………... 5

Abstract…………………………………………………………………….... 6

Table of Contents……………………………………………………………. 7

Chapter One – Introduction

1.1 Background of the Study………………………………………………… 10

1.2 Statement of the Problem………………………………………………... 12

1.3 Objectives of the Study………………………………………………….. 13

1.4 Research Questions……………………………………………………… 13

1.5 Research Hypotheses…………………………………………………….. 14

1.6 Significance of the Study………………………………………………... 14

1.7 Scope of the Study………………………………………………………. 15

1.8 Limitations of the Study………………………………………………… 15

1.9 Organisation of the Study………………………………………………. 16

1.10 Definition of Operational Terms………………………………………. 16

Chapter Two – Review of Relevant Literature

2.1 Concept of Forensic Auditing…………………………………………... 18

2.2 Concept of Forensic Auditor…………………………………………… 26

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2.3 Public Sector Auditing…………………………………………………. 32

2.4 The Nigeria Civil Service………………………………………………. 42

2.5 Conceptual Model of the Study………………………………………… 46

2.6 Empirical Review……………………………………………………….. 47

2.7 Summary of Literature Review…………………………………………. 49

Chapter Three – Methodology

3.1 Methods and Sources of Data…………………………………………… 53

3.2 Method of Data Collection……………………………………………… 53

3.3 Research Population…………………………………………………….. 53

3.4 Determination of Sample Size………………………………………….. 54

3.5 Instrument………………………………………………………………. 55

3.6 Validity and Reliability of the Instrument…………………………….... 55

3.7 Sampling Technique…………………………………………………….. 55

3.8 Method of Data Analysis………………………………………………... 55

Chapter Four – Data Presentation, Analysis, and Discussion of Findings

4.1 Data Presentation……………………………………………………….. 57

4.2 Data Analysis…………………………………………………………… 58

4.3 Test of Hypothesis……………………………………………………… 59

4.4 Discussion of Findings…………………………………………………. 61

Chapter Five – Summary, Conclusion and Recommendations

5.1 Summary of Research Findings………………………………………… 66

5.2 Conclusion……………………………………………………………… 67

5.3 Recommendations……………………………………………………….. 68

References……………………………………………………………………. 70
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Appendix……………………………………………………………………. 73

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 CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

The history of modern civil service dates back to eighteenth century. In response to

economic changes and the growth of the British Empire, the bureaucracy of institutions

such as the office of works and the navy board greatly expanded. Each has its own

system, but in general staffs were appointed through patronage and outright purchase. By

the nineteenth century, it became increasingly clear that these arrangements were falling

short.

British efforts at reform were influenced by the empirical examinations system and

meritocratic system of china. Thomas Taylor Meacows, Britain’s consul in Guangzhou,

china argued in his desultory notes on the government and the people of china, published

in 1847, that “the long duration of the Chinese empire is solely and altogether owing to

the good government which consists in the advancement of men of talent and merit

only,” and that the British must reform their civil service by making the institution

meritocratic. So many reforms have been initiated by the British government to correct

this anomaly. The success of those reforms led to the advancement of civil service

globally. The Pendontle Civil Service Reform Act established a modern civil service in

the United States, and by the turn of the twentieth century almost all western

governments had implemented similar reforms.

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Consequently, the Nigerian civil service has its own origin in organizations established

by the colonial masters (the British). Over the years, various panels have studied and

made recommendations for reforming of the civil service, including the Margan

commission of 1963, the Adebo commission of 1971 and the udoji commission of 1972

to 1974, and with the 1979 constitution, great changes occurred. The Dotun Philips panel

of 1985 attempted to reform the civil service. The 1988 civil service reorganization

decree promulgated by General Ibrahim Gbadamusi Babangida had a major impact on the

structure and efficiency of the civil service. The later report of the Ayida panel made

recommendation to reverse some of the past innovations and to return to the more

efficient civil service of earlier years.

The civil service has been undergoing gradual and systematic reforms and restructuring

since May 29, 1999 after decades of military rule (Ali and Babura 2003). However, the

civil service is still considered stagnant and inefficient, and the attempts made in the past

by panels have had little effect. The Mainagate and other civil service scandals (Kogi

Civil Service Fake Certificate Scandal of 2017) are the end products of the inefficiency

and stagnation of the civil service. These scandals have brought severe criticisms to the

Nigerian government by eminent Nigerians.

Furthermore, unethical practices have been the norm in the civil service. Anger (2002),

has pointed out that such unethical behavior has to do with conflict of interests, loyalties,

or values; it could also be as a result of attempts to achieve some form of private gain to

the detriment of the masses. In the course of policy implementation, civil servants very

often breach the ethical values of loyalty, courtesy, respect, integrity, and neutrality.
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Madumere (2016) noted that factors such as collusion, fatigue, abuse of power, lack of

supervision and poor communication are also inherent limitations of internal control

system. Weak internal control system serves as a breeding ground for fraud and other

unethical practices.

Following the rise of fraud and other unethical practices in the Nigerian civil service, the

government has been urged by eminent Nigerians to do the needful by engaging the

services of forensic auditors in order to mop out fraud and unethical practices in the civil

service.

Forensic auditing refers to the systematic process of applying accounting methods to the

tracking and collection of evidence, usually as embezzlement or fraud. Forensic auditing

draws its name from association with a court of law. It is performed to accomplish an

objective that involves a judicial process. The computation of asset values assessment of

damages caused by an auditor’s negligence, fact finding to check whether embezzlement

has taken place, in what amount, and whether criminal proceedings are to be initiated,

and the collection of evidence in a criminal proceeding form the objectives of forensic

auditing.

Forensic auditing is focused on both the evidence of financial transactions and reporting

as contained within an accounting system, and the legal framework which allowed such

evidence to be suitable for the purpose of establishing accountability. The role of forensic

auditing in enhancing the productivity of Nigerian civil service is the focal point of this

research study.

1.2 Statement of the Problem

In recent years, the Nigerian civil service has been rocked with numerous scandals

leading to the misappropriation and embezzlement of public funds by civil servants. This
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 large scale financial fraud has adversely affected the operating efficiency of the civil

service.

Furthermore, the internal control system in the civil service is prone to financial fraud

due to lack of regular auditing practices and inadequate supervision by the government.

The inability of the government to conduct regular audit in government institutions has

affected its productivity.

Professional auditors and legal practitioners are under pressure to find a better way of

minimizing fraud in Nigerian civil service. The primary goal of this research study is to

address the problems of financial scandal in the Nigerian civil service using the services

of forensic auditors, so as to enhance the productivity of the institution.

1.3 Objectives of the Study

The objectives of this study are to:

i. Find out how the practice of forensic auditing will reduce fraud in the Nigeria

civil service.

ii. Determine if forensic auditing can promote civil service performance.

iii. Investigate the role of forensic auditing in addressing obstacles to effective

internal control system in Nigeria civil service.

1.4 Research Questions

This study has the following research questions from which hypothesis will be formulated.

1) To what extent has forensic auditing reduced fraud in Nigerian civil service?

2) To what extent has forensic auditing promoted civil service performance?

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 3) To what extent has forensic auditing addressed the obstacles to effective internal control

system in Nigeria civil service?

1.5 Research Hypothesis

To carry out the work efficiently, it was deemed appropriate to formulate the following tentative

hypotheses as a guide to choice of data for proper statistical treatment and as a framework for

conclusions:

HO1: There is no significance relationship between forensic auditing and fraud reduction in the

Nigeria civil service.

HO2: There is no significance relationship between forensic auditing and civil service

performance.

HO3: There is no significance relationship between forensic auditing and effective internal

control system in the Nigeria civil service.

1.6 Significance of the Study

This research will be of immense benefit to the following category of people in the Nigerian

society:

Government: The three tiers of government will benefit from this study by enjoying the

improved auditing standard that will arise from the identification and solution of the audit

problems which will result to audit efficiency.

Future researchers or writers on the topic who may use it as a reference material.

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To experts in the Financial sector: This research will be significant to intellectual and forensic

auditors in that they will now improve on how to audit government account in accordance with

the relevant auditing standards.

Private sector and specific organizations: In a much wider sense, forensic auditing will

become systematically relevant and associated with proper accounting and the use of money to

measure the performance of business profession in the country.

Civil Servants: The study will play a key role in minimizing fraud in the Civil Service, which

will enhance the productivity and welfare of Civil Servants in the area of promotion, job

satisfaction, retirement benefits and remuneration.

1.7 Scope of the Study

This study is designed to deal thoroughly with government accounting and auditing in all areas

including the problems inherent in Nigerian civil service. In the light of broad coverage, we

focused on the role of forensic auditing in the Nigerian civil service using Abia state civil service

commission as a case study.

1.8 Limitations of the Study

In the course of carrying out this research work, some factors were encountered. These

constraints include:

Inaccessibility to all possible materials: despite serious efforts made by us to reach, acquire and

view all relevant pieces of literature materials related to the subject of the study, it was not

possible to lay hands on sufficient level materials with respect to the distribution practices of the

questionnaire.

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Insufficient finance: This study was intended to investigate all federal ministries, departments

and agencies (MDAs). However, it was economically feasible to study Abia State Civil Service

Commission due to lack of funds.

1.9 Organisation of the Study

The organisation of the study entails the summary of each chapter in the research work. Chapter

one is also known as the introductory section. This chapter covers the background of the study

(Definition of forensic auditing), statement of problem (The problems the research intends to

solve), objectives of the study, research questions and hypothesis, significance of the study

(Beneficiaries of the study) and definition of operational terms used in the research work.

Chapter two covers the review of relevant literature relating to forensic auditing in Nigerian civil

service. Chapter Three unveiled the research methods or techniques used by the researcher in

order to arrive at a research result. Chapter Four covers the area of data presentation, data

analysis and data interpretation. Chapter Five covers the conclusion, recommendation and

reference aspect of the study.

1.10 Definition of Operational Terms

The following terms are defined to show authority and scope of responsibility.

Accountant-General: This means the accountant general of Nigeria who is the chief accounting

officer of the government.

Auditor-General: Is the auditor general of a country who by his position is the chief auditor of

the government account prepared by the accountant general.

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Accounting system: This is a systematic way of recording, analyzing, interpretation and

presentation of transaction in financial terms.

Forensic Auditor: An individual who is a member of accounting professional bodies and

specializes in the area of forensic auditing and fraud investigation.

Internal control: Any action taken by an organization to help enhance the likelihood that the

objectives of the organization will be achieved.

Nigerian civil service: This denotes employees in government ministries, departments and

agencies other than the military.

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 CHAPTER TWO

REVIEW OF RELEVANT LITERATURE

The review of relevant literature in this chapter covers the following areas:

Concept of forensic auditing

Concept of forensic auditor

Public sector auditing

Nigerian civil service

Conceptual model of the study

Empirical review

Summary of Literature Review

2.1 Concept of Forensic Auditing

In the government forensic auditing usually examines allegations and complaints about

wrongdoing involving significant federal funds or assets (Akenbor and Ironkwe:2014). The

procedures used are designed (who, what, how, when, and where) in a manner that ensures that

any evidence of wrongdoing may ultimately be presented in administrative, civil or criminal

proceedings. According to Grippo and Ibex(2003), Forensic audits are more intensive than

regular audits and are usually conducted in a series of steps to determine if allegations can be

substantiated and to identify the nature of any further work needed. Important first steps are to

ensure that the allegations or complaint has merit that adequate evidence is available and that a

department has the authority to investigate or audit. This is particularly important when a

recipient of a grant, contribution or other transfer payment receives resources from sources other

than the department. In this regard it is also important that the records of the recipient allow for

investigation or audits to trace how a department’s funds were used.

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Thornhill(1995) stated that forensic audits require a clear and detailed audit plan that is designed

to obtain information on how, when, and where a wrongdoing occurred and who committed such

a wrongdoing. Normally a preliminary examination would be conducted to allow for the

assessment of the allegation or complaints in terms of specified criteria such as materially and

impact. An audit plan should have clear objectives and timeliness, and should identify the skills

needed, the estimates, costs, and any limitations on the on the scope of the examinations.

Contractors should have statement of work (engagement latter) detailing their roles and

responsibilities.

Forensic audit reports are usually lengthy and extensively substantiated and contain a clearly

documented chronology of events (Ghali,2001), whether conducted by external experts under

contracts or by departmental staff, the auditors must have the necessary qualification and

knowledge to conduct them. Departmental officials who supervise such audits also need special

training. Experts who conduct forensic audits need special qualification and knowledge. They

will need to become familiar with a program’s financial and management controls and what

would constitute a wrongdoing under applicable legislation and policies. In addition, forensic

auditors need to: (1) have the skill to determine what to examine, what constitute relevant and

valid evidence, where to look for it, and how to obtain or extract it; (2) be adapt at interviewing

departmental and recipient officials; and (3) be able to present findings and explanations in a

manner that can be used to support administrative, civil or criminal action.

It should be kept in mind that forensic auditors may be called as expert witness in administrative,

civil or criminal proceedings. They must, therefore, be able testify in an understandable and

impartial manner. It should also be noted that departmental officials involved in the

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administration of the program as well as those responsible for initiating or acting on the results of

the audit may be called as witnesses (C.C Albrecht, W.S. Albrecht and Dunn, 2001).

Indicators of Fraudulent Practices

Both the management and employees of an organization have inept desires for fraudulent

practices. The indicators of employees fraudulent practices are revealed by Girling(1997) are:

Overworking: Financial criminals are sophisticated and know that the typical suspects

of misdeeds in organization are likely to be those who miss work a lot, call in sick, go

home early and so forth. Hence, the financial criminal (also by inclination) tends to work

long and hard, stays after hours, volunteers for extra duties, or in short, attempts to appear

as a superstar in the organization. This is called the protective behavior pattern

(Mohd&Mazni, 2008);

Over-personalized business matters: Mohd and Mazni(2008) claimed that a financial

criminal will become externally upset over little things that touch on or threaten their

scam or fraud, and this may be something as minor as a change in office location or

something like another employee dealing with. They may also not have kind words to say

about top management (calling them corrupt) because: (a) They want to be perceived as a

powerbroker or dealmaker; and (b) They plan to claim, if caught, that the kind of thing

they did was nothing compared to what goes on at the top;

Anti-social loner personality: The criminal may or may not have this personality to

begin with, but criminologists say that something about the unshareable aspects of

financial crime may cause the person to become a loner. Their constant griping about top

management and how screwed up the workplace is also tends to result in a perception

that they are antisocial. Their relationships with co-workers can be characterized as cold
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and impersonal, since all they are inquisitive about is how co-workers do their jobs so

they can learn about any system controls that are in place throughout the organization

(Maier, 2002);

Inappropriate lifestyle change: Few financial criminals can resist the urge to spend

some of their ill-gained loot, and their lifestyles assets, travels, or offshore bank account

will just not add up to the salary they are making. They are driven by money and ego, and

if given the chance, they will jump at almost every opportunity to make more money and

to boast and brag about knowing such opportunities.

On the part of management, Mohd and Mazni(2008) identified the following indicators of

fraudulent practices:

Unrealistic Performance compensation packages: The Organization will rely almost

exclusively, and to the detriment of employee retention, on executive pay system linked

to the organization’s profit margins or share prices;

Inadequate board oversight: There is no real involvement by the directors. Board

appointments are honorariums for the most part, and conflict of interest as well as

nepotism (the second cousin to corruption) are overlooked;

Unprofitable offshore operations: Foreign operation facilities that should be closed

down are kept barely functioning, because this may be where top management fraudsters

have used bribes to secure a ‘safe haven’ in the event of need for a swift exit;

Poor segregation of duties: The Organization does not have sufficient controls on who

has budget authority, who can place requisitions, or who can take customer orders,

orders, and who settles or reconciles these things when the expenses, invoices, or receipts

come in;

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 Poor computer security: The Organization does not seem to care about computer

security, has slack password controls, and has not invested in antivirus, firewalls, log

files, data warehousing, data mining, or the organization seems to be over-concerned with

minor matters, like whether employees are downloading music, chatting, playing games,

or viewing porn;

Low morale, high staff turnover, and whistle-blowers: Low morale and staff shortages

go hand-in-hand, employees feel overworked and underpaid, frequent turnover seems to

occur in key positions, and complaints take the form of whistle-blowing.

Forensic Auditing and The Auditor-General

Forensic auditing has a unique focus, which distinguishes it from regular, performance, and

computer auditing, but the interdependence of the various disciplines is acknowledged. These

audit disciplines, which form the functional audit components, have thus far been very

instrumental in highlighting instances of possible economic crimes.

According to Folie(1999), the objectives of the office of the auditor-general with forensic

auditing include:

To determine the nature and extent of the perpetration of economic crimes and the

adequacy and effectiveness of measures that should have either prevented or detected

such crimes;

To facilitate the investigation of economic crimes in general by providing support to the

relevant investigating and/or prosecuting institutions (by handing over cases and

providing accounting and auditing skills).

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Proactive and reactive techniques have been developed to achieve these objectives. The

proactive technique is aimed at preventing economic and financial crimes by promoting

an overall fraud awareness culture in the public sector through, inter alia, publications,

presentations/workshops, and participation in relevant national and international

initiatives (Uzoka, 1990). This is done with the aim of promoting a culture of ‘zero’

tolerance through interventions, such as publishing relevant articles, participating in

workshops, seminars, and conferences (which provide developmental learning and

networking opportunities), presentation of training programmes, providing support to

national/international initiatives, and making stakeholders aware of deficiencies in the

measures instituted to prevent or detect economic crimes.

The most efficient and effective way to prevent economic crimes is to know the

circumstances surrounding them or the conditions that will enhance the possibility of

their occurrence. According to Levanti(2001) and Squires(2003), the approach to be

followed in this regard on the fact that the following aspects should minimize the risk of

economic crimes.

Strong Financial Management Systems: The auditor-general is authorized to enquire

into the efficiency and effectiveness of internal controls and financial management

systems and to report thereon. Management is well informed that, should the measures

and systems implemented by them not be adequate to ensure probity and the risk of

economic crimes, they will be held accountable through the office’s reports to the

relevant legislative bodies;

Effective internal controls: In determining, the scope and extent of the audit, in terms of

the Generally Accepted Government Auditing Standards, the auditor-general is

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 compelled to study and evaluate the reliability of internal controls, which could include

organization of work, segregation of duties, physical security measures, authorization and

approval, arithmetical and accounting procedures, effective training of staff, supervision,

and management. The fact that the auditor-general, in its audit approach, conducts

procedures to evaluate the effectiveness and reliability of the relevant institution’s

internal controls and to report thereon, serves as a very definite deterrent for potential

perpetrators of economic and financial crimes;

Adequate public awareness (and acceptable standards of conduct): The results of the

auditor-general’s findings are made available to all the relevant legislative bodies at all

government levels, at least annually. These findings become public knowledge once the

audit reports have been tabled and the general public has access to them. There is a

disclosure policy entailing the issue of media releases on the findings of the audit

findings serves as another deterrent to economic crimes.

According to Ansari(2005),the reactive technique focused on the investigation of allegations of

economic and financial crimes. The submitted allegations are confirmed or refuted by collecting

and submitting substantive evidence. The objective would be to investigate and report on: (1) the

nature and extent of the specific instance of economic and financial crimes; (2) the suspects

involved; (3) deficiencies in the measures that should have prevented or detected the crimes; (4)

recommending punitive steps and further actions in respect of; (a) criminal prosecution; (b)

criminal recovery; and / or (c) disciplinary action; and (5) progress made by other institutions in

investigating relevant cases.

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Findings are then reported on through the normal audit process or when applicable, are handed

over to institutions with investigating and prosecuting powers, such as the Economic and

Financial Crime Commission (EFCC) and Independent Corrupt Practices Commission (ICPC).

Albrecht et al.(2001) identified the following key functions of forensic auditing: (1) to carry out

the vision and mission of forensic audit to prevent, detect, and investigate issues of fraud and

financial abuse within an organization/entity; (2) identification of causative factors and

collection of facts for individual investigations by leading the evaluation of internal control

weakness that allow unethical business behaviors and practices to occur and go undetected; (3)

lead internal and external resources in an effort to address allegations of fraud raised within the

system; (4) provision of help in the development of fraud awareness training and analyze fraud

trends and internal control procedures; (5) perform a comprehensive analysis of investigation

results across the enterprise to identify pervasive control issues; (6) oversee the investigations,

planning and forensic report writing process for forensic audits, and investigations and

presentation of findings through report and exhibits; (7) work closely with financial training

function to enhance fraud auditing skills; (8) develop the fraud prevention, detection, and

investigation program and management of company’s fraud risk assessment program; (9)

conduct activities in areas of moderate to high risk; (10) conduct complex and extremely

sensitive investigations; (11) promote education and awareness on fraud risk management

throughout the bank; and (12) testifying in court as an expert witness (Girling, 1997).

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Objectives of Forensic Audit

The objectives of forensic audit will help us to understand the role of forensic auditor and its

impact on corporate governance (Eyisi and Agbaeze, 2014). These objectives include:

 To improve management accountability.

 To improve corporate governance and the statutory audit function

 To improve financial reporting system.

 Help in detecting financial fraud.

 Provide additional assurance for audit committees.

 Assists financial statement auditors to take greater responsibility for the detection

of fraud and illegal acts when auditing financial statement due to the fact that

another set of auditors (forensic auditors) would be critically evaluating their role.

 Gives the audit committee better tools to evaluate the quality of the financial

statement audit by the external auditor.

The above objectives could be said to have stronger impact on corporate governance, since the

forensic auditor is expected to go beyond normal audit so as to search for fraud and investigate

deeper using more sophisticated scientific analytical tools and software packages to detect

fraudulent activities perpetrated by the management and their employees or fraud which the

external auditor has conceivable connived with the management to cover.

2.2 Concept of Forensic Auditor

The term forensic means ‘’relating to the application of scientific knowledge to legal problems or

usable in a court of law’’ (Bolgana and Robert,1985). According to singleton 2004, Webster

26
dictionary defines forensic as belonging to, used in, or suitable to courts of justice or to public

discussions and debate. Thus, from the above definition it could be said that forensic auditors are

experts in financial matters who are trained in detecting, investigating and deterring fraud and

white collar crimes which are to be presented to court for legal action or to public discussion and

debate. This is in line with (Messier, 2000) definition which states that forensic auditors are

fraud examiners employed by corporations, government agencies, public accounting firm and are

trained by association of certified fraud examiners (ACFE) on areas which covers, fraudulent

financial transactions, legal elements of fraud investigation, criminology and ethics.

Functions of Forensic Auditors

Cabole(2010) defines forensic activity as the activity that consists of gathering, verifying,

processing, analyzing of and reporting on data in order to obtain facts and/or evidence in a

predefined context in the area of legal financial disputes and or regulative (including fraud) and

giving preventative advice from the above one can say that a forensic auditor is an expert in

accounting with experience and special skill in auditing fraud detection and criminology that

carries out investigation which is usable in the law court.

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Differences Between Forensic Auditor and Financial Auditor
According to Eyisi and Agbaeze(2014), the difference between forensic auditor and
financial auditor can be shown as below:
Forensic auditor or non-statutory auditor is
employed or appointed by organizations to
resolve allegations and detect or prevent
fraudulent activities suspected or envisaged
in the organization. Thus, forensic auditors
carry out investigation as to resolve
allegations on fraudulent financial matters
through court.
Forensic audit is directed at specific
allegation-forensic auditors carries out
investigation on specific allegations. Hence
has much time to investigate and analyze
thoroughly specific fraudulent financial
issues with emphasis of using such as
evidence in law court in case of dispute
(Albrecht and Albrecht,2009)
Forensic auditor is not is not apt to accept
explanations and documents at face value
(Cole 2009) from the above, the above, the
forensic auditor is expected to always go
beyond the normal audit and search for fraud
which are to be reported to who so ever have
appointed the forensic auditor or to be used
as expert evidence in the law court.
28
Financial auditor or statutory auditor is usually
appointed to carry out statutory audit. The
financial audit is usually carried out to satisfy
statutory requirements, and ensure that accounts
prepared/maintained are in line with GAAP.
Thus, statutory auditor may or may not go
beyond the procedural audit since he is not
compelled by law to search for fraud but rather
in carrying out its audit function if fraud is
detected he will unveil it.
Financial audit carried out by the financial
auditor is general in nature. According to
Millucky and Mac (2013), financial audits is
carried out on general financial matters (that
means the auditor considers all issues which
concerns all relating to accounting).
Financial auditor s usually do not burrow deeper
into documents and explanations. This means
that financial auditor usually do not carry out
detailed analytical study of financial documents
and explanations rather they try to lay credence
that accounts prepared by management and their
employees are in line with GAAP and statutory
regulations (Cole,2009).
Responsibility of Forensic Auditors in Combating Fraudulent Activities

According to Eyisi and Agbaeze (2014), the responsibilities of forensic auditors in

combating fraudulent activities include:

 Conducting Investigation: The forensic auditor does not carry out procedural

audit, but carries an audit which conducts investigation as to detect fraud or crime

using computer programs or scientific knowledge. This means the forensic auditor

should have the capability to use computer forensic tools that could be both

software and hardware in carrying out its function as to detect or prevent

fraudulent activities. Thus, by using computer forensic tools in carrying out its

responsibilities, sophisticated fraudulent activities can be combated.

 Analyzing Financial Transactions: Forensic auditors should have the

capabilities to analyze financial transactions which will help him to easily detect

errors, fraudulent activities and omissions that may be presented for litigation or

sent to the audit committee as to enable the audit committee to evaluate the

quality of financial statement audit.

 Reconstruction of Incomplete Accounting Records: In order to combat

fraudulent activities, the forensic auditor with his skills (Technological,

communications and expertise skills) in accounting knowledge can reconstruct

incomplete accounting records, hence helping to detect and prevent fraud and

ensuring good internal control system and good corporate governance.

 Embezzlement Investigation: In carrying out embezzlement investigation and

providing documentation, and negotiation of insurance settlement the forensic

29
 auditor uses his special skills and experience, thus helping to detect the culprits

and amount embezzled.

Characteristics of Forensic Auditor

Wallace (2009) listed the minimum requirement a forensic accountant must possess to include:

 An ability to review a large volume of documentation ranging from the more usual

accounting records and management information system to memos, correspondence and

other less obviously financial data and to extract the key issues quickly.

 A sound understanding of peculiarity of various business methods.

 A sense of urgency and commitment which will ensure prompt response when required

however slow civil litigation may appear to the on locker or even to the participant in a

dispute.

 Adherence of strict timetable even when need arises to work for more hours to meet

targeted time. Most essentially, an ability to appear objective and professional even when

taking in the inherently partisan process of a court case.

The Forensic auditor requires special skills in auditing, accounting quantitative methods, finance

specific areas of the law, information and computer technologies, research and investigative

skills as to be able to collate, analyze and evaluate evidential matter which in the forensic area is

called evidence (Forensic and compliance institute, 2009).

30
 Skills of Forensic Auditors

Technical Skill Financial Skill Honesty and Integrity

Forensic Auditors

Analytical Skill Investigating Skill Communication Skill

Researcher’s model, 2018

The six skills possessed by the forensic auditors are as follows;

 Honesty and Integrity: Since the forensic auditor is expected to detect fraud, he

or she is expected to be of high integrity and honesty in carrying out his functions.

 Investigating Skill: The ability highly needed by the forensic auditor to search

for fraudulent financial acts, errors and misstatements.

 Analytical Skill: Ability to analyze complex financial transaction using expertise

intuition to detect fraudulent activities and perform effective analysis of financial

transaction.

 Technical Skill: The most important skill required by forensic auditor so as to

detect fraud is solid technical accounting skills. The forensic auditor should be

31
 able to examine and prepare financial statements in order to discover fraud

perpetrated by the management and their employees.

 Financial Skill: Forensic auditors should be able to examine the accounting

records of an entity through vouching and tracing methods. They should be able

to reconstruct incomplete accounting records to check its accuracy.

 Communication Skill: Forensic auditors should possess good interactive skills to

be able to interview suspects and non-suspects so as to obtain sufficient, reliable

and relevant information.

2.3 Public Sector Auditing

Public sector organizations embrace local authorities, government departments, public

corporations where government has substantial interest.

Government may be defined as an organized entity which in addition to having government

character has sufficient discretion in the management of its own affairs to distinguish it as

separate from the administrative structure of any other governmental unit (Aguolu: 2008).

Government and governmental entities may be distinguished into two categories; General

purpose government and Special purpose government.

In Nigeria, there are three tiers of general purpose governments. The limited purpose government

entities are those that provide one distinct services such as education, health, water, sewage

disposal etc. General purpose government provides a wide range of services including education,

defense, security, health, environmental protection, roads, bridges, welfare, etc. Governmental

entities differ from business organizations in the following respects.

32
Governmental organizations may collect significant accounts of resources from resource

providers who do not expect to receive either repayment or economic benefits

proportionate to the resources provided.

The operating purposes of governmental entities are not intended to provide goods or

services at a profit or profit equivalent.

Governmental entities do not have defined ownership interests that can be sold,

transferred or redeemed or that can even confer entitlement to a share of the residual

distribution of the resources in the event of liquidation of the entity.

Government exists in an environment where power ultimately rest in the hands of the

people. By their votes, people delegate power to public officials through an electoral

process. This power is exercised by three arms of government, the Executive, the

Legislature and the Judiciary. The Legislative through legislative actions, performs

oversight functions over the executive which carries out administrative and Legislature

are under the review of the Judiciary.

Governmental accounting adopts the modified accrual basis which requires the

recognition of revenue in the period which it becomes available and measurable. There is

no profit motive in public sector accounting; hence, the accountant prepares a financial

statement that should always show responsible deployment of public funds which reflects

the attribute of economy, efficiency and effectiveness.

The professional guidelines on public sector engagement as issued by the Audit Practice

Committee (APC) is hereby restated as: efficiency, economy and effectiveness which are

three components that provides good measures of assessing the performances of

33
 management in the use of organizational resources in terms of fiscal compliance

programme, activity, financial viability and value of money.

The International Public Sector Accounting Standards Board (IPSASB) of the

International Federation of Accountants (IFAC) develops accounting standards for public

sector entities referred to as International Public Sector Accounting Standards (IPSASS).

The IPSASB recognizes the significant benefits of achieving consistent and comparable

financial information across the world and it believes that the IPSASS will play a key

role in enabling these benefits to be realized.

The inability of the auditor to assess the performance of management and question the

policy objective of government are the usual problems encountered in public sector

auditing. In spite of this, the auditor is still required to examine the policy decisions and

the way in which objectives are achieved and report on their accuracy and completeness.

The above problems of performance assessment associated with auditing of public

concerns could be solved by setting objectives, setting up internal audit department, the

use of external auditor as part of annual audit and the use of external review team such as

management consultants and observing relevant legal requirements and rules of

professional conduct.

Internal Audit in The Public Sector

An understanding of the role of effective internal audit shows that it can help to identify ways to

improve efficiency and minimize exposure to possible loss from inadequately safeguarded assets.

Apparently, this was the major consideration of British Colonial Administrators when they left

solid structure of internal control in public service by setting up internal control unit in each

ministry/department.

34
In spite of the cherished objective of establishing internal audit unit and high expectation of its

efficient performance in the public sectors, the activities of home auditing officers have

constituted hindrance to the efficient functioning of internal control units to each parastatal. The

more auditing officers are those within the ministry/department other than the auditor (internal or

external) who possess the authority to command, direct and influence the auditor’s opinion by

the information they possess.

The means through which non auditing officers constitute problem to efficient operation of

internal audit unit, the public sector displaces the essence of auditing practice where a good and

effective system of internal control is established so that the auditor can carry out a valid audit.

Orji (2010), identified hindrances/obstacles to the efficient functioning of internal audit unit in

the public sector:

a). Management representation/abuse of authority: Authorization controls can be abused by

the officials in whom such authority is vested. This occurs in situations where an official fails to

perform an expected control or perform such control to the detriment of establishment. A good

example of this situation is where the chairman of a contract tenders board over values a contract

for his own advantage.

b). Staff collusion: Collusion is the compensating relaxation of interrelated checks by staff who

operates complementary roles for their mutual benefits. The system of internal control usually

requires the segregation of duties so as to ensure that no one person carries out the three aspects

of any transaction that its objective is that each person in the course of performing his duties, acts

as a check on another who also automatically checks the earlier person in the performance of his

35
own duties. By his arrangement, no one person is in a position to commit fraud or conceal his

action by falsifying the records.

c). Classification of certain documents as highly confidential thereby preventing audits from

having access to them.

d). Ignorance of the objective of audit: The belief that government created internal audit

department in the ministries/parastatals/organizations are established to provide jobs for people

thereby further the continuity of non-challant attitude usually associated with government

functionaries.

e). Asset valuation/Obsolescence: An organization may change thereby rendering an existing

system obsolete but management may be reluctant to effect a change either because of the cost

involved or for lack of the skill required.

f). Staff Incompetence: A good internal control may be in place in an organization. However,

incompetence, lack of care or integrity, fatigue or human error can vitiate the effectiveness of a

good internal control.

g). Management overriding established controls: It is the duty of the management to establish

and enforce controls. However, in practice, management is usually reluctant to enforce those

controls in their personal activities or the activities of their relations and friends. Also, staff that

is charged with the responsibility of enforcing those controls may not be willing to extend these

controls to management out of fear, respect, or intimidation by management.

h). Inadequate installation of accurate accounting system: The introduction of computers to

replace manual operations have caused severe disruptions in the system. Furthermore, drastic or

frequent alterations in the system for whatever reason can lead to a total breakdown. This may be
36
an alteration for a well-intended improvement or as a result of frequent staff turnover. However,

significant accounting controls may become the functions of non-accounting trained persons just

because they are computer literate but they will be unable to post transactions accurately.

I). Desire to cover fraud and intentional errors they have committed or collaborated to

commit:

There is need to educate these non-auditing officers in the objective of audit, advantages of

internal audit and awareness of their responsibility to make available all documents needed by

the auditors in accordance with the auditor’s right given in the constitution. However, as a result

of occasional threats and gifts, these officers deliberately withhold vital information which in

their opinion is classified secret.

Madumere (2016) pointed out inherent limitations to an effective internal control system which

includes:

 Collusion: A situation in which two or more persons connive to put heads together in

order to beat an internal control system with fraudulent intention. Incidentally this

happens to be the most common enemy of internal control systems and indeed the easier

way of wrecking such systems. It is also important to note further that most fraudulent

activities in organization takes place because those vested with the responsibility of

enforcing internal controls have for personal reasons agreed to compromise their roles.

 Fatigue: This is a situation in which an individual performing a certain function gets

tired as a result of work overload. This often results in loss of concentration in which case

the person may fail to accomplish what is expected of him.

37
 Abuse of power: The misuse of power and authority by some officials in organizations at

the expense of internal control systems put to protect the assets of such organizations.

Evidence has shown that sometimes officers by virtue of being in charge take things for

granted not minding the implications their actions. Abuse of power by entrusted officers

often undermines the effectiveness of internal control systems.

 Lack of supervision: Internal control systems would normally require the

implementation of certain laid down control procedures by individual workers in

organizations. However, in as much as tasks are assigned to individuals, there is most

importantly the need for follow up to ensure the ascertainment of the extent of

compliance. In view of this, it becomes necessary to ensure that regular routine

supervisory checks are carried to assess the level of compliance with all internal control

measures.

Such supervisory checks are to provide a reasonable assurance that:

i. Laid down internal control measures are implemented.

ii. Associated problems are detected early and solutions proffered.

iii. New measures are suggested where existing ones become ineffective.

In addition, it is always necessary to cultivate the practice of reviewing and

changing internal control systems and procedures from time to time. By so doing

the desired effectiveness of such systems stands to be achieved.

38
  Poor communication: Sometimes lack of proper understanding of internal control

procedures, which may result from poor communication, can to a large extent affect the

quality of internal control systems.

Public Accountability and External Auditing

External auditing is statutory and the external auditor’s responsibilities are laid down by statute

and for practical purpose are specified in an engagement letter. Both the internal and external

auditors are accountants who perform similar functions. Orji (2010) noted that the internal

auditors and the external auditor have common interest in the following areas:

 A good and effective system of internal control in the organization.

 Continuous operation of the established system and to report cases of failure.

 Accurate and adequate information to the management.

 Safeguarding the assets of the organization; and

 Accurate and reliable accounting records.

Accountability in particular public accountability is as old the existence of human beings in

social forms. In any social set up, what should constitute accountability remains a problem.

Generally, it implies stewardship but in government it goes beyond stewardship functions. This

is as a result of added dimension of complexity which is one of the most significant aspects of

management in assessing whether the use of resources is better than another. This aspect of

complexity becomes serious when decisions taken by public officers are brought under scrutiny

by those who were not parties to those decisions or are even incapable of appreciating the

intricacies of such decision.

39
Government Accounting Issues and Financial Control

Obviously, meaningful improvement on public sector auditing is possible if improvement takes

place in government accounting and financial controls which forms part of the whole system.

With this under consideration, the inadequacies in certain areas of each of the system that make

up government accounting have either been pointed out and criticized or mentioned for failure

development.

Consequently, it must be apparent by now that there are two systems operating in government

accounting and financial control, which came into existence between 1956 and 1958 had only

experienced minor review in 1978 when another constitution came into existence.

Even the new innovations brought by 1979 constitution were eroded by the return to the status of

pre-1979 as a result of return to military rule. The introduction to 1988 civil service reform

suggested effort at improving the system of financial control in government. Contrary to ones

expectations on the reform, we have found ourselves in the present situation where sound

accounting and financial control principles are not practiced. The implication of this is that the

assets are no longer being safeguarded and deployment funds as well as accountabilities are

things of the past.

Accounting and Financial Control Failures

According to Orji (2010), Financial accountability demands three essential conditions to operate

smoothly: good financial reporting, sound management system and effective organizational

arrangement. In government, the first condition is a function of accountability which requires

accurate and timely financial information. Sound management system is referring to budgeting

and calls for procedure and methods which help to utilize public funds to various levels of

40
responsibilities. Effective organizational arrangement is a function of control which requires a

clear definition or responsibilities. It is the lack of this essential condition for the smooth

operation of accounting and financial control that lead to crumbling of the financial

accountability.

There were evident failures virtually in all the phases of the financial management circles

confirmed by direct embezzlement, receipts of huge kickback, contract inflation, large scale

salary fraud, etc; The effect of this unholy situation in the public sector has raised doubt if

control system were in operation in government establishment.

Auditing Failures

In the second republic up to the present administration, large scale corruption, embezzlement and

other associated financial practices can be attributed to the failure of financial system in general

and to the failure of the audit department in particular. Orji (2010) emphasized on the two

categories of financial fraud commonly encountered in government ministries/ department are

thus:

a). Those perpetrated by chief executive and other political office holder (commission special

advisers, chairmen and board members, general managers of government parastatals and those

perpetrated by public servants who are employees to government).

b). The second category of fraud is leadership fraud which is equivalent to the management fraud

in the private sector.

41
Institutional Failures

Orji (2010) noted that the failure of the treasury and budget department to evolve system to

coach control is point against the institutional arrangement to ensure efficient structural control.

Also, the auditor general’s office has shown serious lack of financial discipline, crumbling

accounting system has not deemed it fit to seek for an initiative within the budget and treasury

department to review the system and the procedure, rules and regulations.

Technical Issues

The sound conceptual framework for government accounting is the major concern, which if

addressed properly will minimize audit problems in Nigeria. In the pursuit of acceptable sound

accounting framework, it will automatically lead to the development of ‘’generally accepted

accounting principles’’ for government accounting.

In resolving these technical issues, Orji (2010) reflected on the criteria which are generally

regarded as good for financial report namely:

 Technical accuracy

 Adequate information for users

 Logical and clear representation and

 Timely presentation.

In order to achieve the above requirement for good financial reporting consideration should be

given for standard setting of:

 The preparation of account.

 The verification of account for publication.

42
 The finalization of account for publication.

Computerization of Government Accounting

It was envisaged by Orji (2010) that the introduction of central personal system, the whole

personnel records of all the public servants will be put in online processing. It was recalled

that the above idea was welcomed generally by well-informed citizens of the country.

The advent of e-payment (electronic system of pay rolling) which emanated as a result of

suspicious existence of ghost employees in the public sector and increased wage bills. The

idea of computerization of pay roll accounting unit of public service was introduced but the

issue of manpower was not given much consideration.

Man Power Issues

Orji (2010) noted that accounting and financial system in government as well as other

management system requires adequate man power to operate, maintain and update data. In

considering the manpower issues, it is vital to consider other institution charged by law to

examine the accounts prepared through mechanical method called computer. Also, in the

private sector, external auditors are trained to equip this computer with the audit technique in

a computerized environment.

Therefore, computer trained and other training infrastructures became important ingredient in

successful operation of accounting and financial control in government where computer has

taken over the processing of accounting information.

Although, the manpower pool in the paroling unit are supposed to be accountants who by

training in higher institutions are qualified to operate these computers but it is strange to

43
observe that both accountants and auditors who should be conversant with the control

technique in processing accounting information through the computers are ignorant of

operating the machines. Government should take into consideration the appropriate trainings

for these professionals who are deficient to become beneficiaries and have technical skills

and knowledge that is required for computerization.

2.4 The Nigerian Civil Service

The Nigerian civil service consists of employees in the ministries, departments and agencies

other than the military. They are career civil servants in the Nigerian ministries and

parastatals, progressing based on qualifications and seniority. Severally, the government has

been introducing measures to make the ministries/parastatals more efficient and responsive to

the public. The Nigerian civil service has its origin in organizations established by our

colonial masters (the British). Nigeria gained full independence in October 1960 under a

constitution that provided for a parliamentary government with three regions (Northern

region, Western region, Eastern region). Since then, various panels have studied and made

recommendations for reforming of the civil service, including the Margan commission of

1963, the Adebo commission of 1971 and the Udoji commission of 1972-74, and with the

1979 constitution, great changes occurred (Madumere and Okegbe;2016).

The Dotun Philips panel of 1985 attempted to reform the civil service. The 1988 civil service

reorganization Decree promulgated by General Ibrahim Gbadamusi Babangida had a major

impact on the structure and efficiency of the civil service. The later report of the past

innovations and return to the more efficient civil service of earlier years. The civil service has

been undergoing gradual and systematic reforms and restructuring since May 29, 1999 after

decades of military rule (Ali and Babura 2003). However, the civil service is still considered
44
stagnant and efficient, and the attempts made in the past by panels have bad little effect. In

August 2009, the Head of Civil Service, Stephen Osagiede Oronsaye, proposed reforms

where permanent secretaries and directories would spend a maximum of eight years in office.

The reform, approved by President Umaru Yar’Adua, would result in massive retirement of

permanent secretaries and directories, many of whom are form the North. According to

Sarki(2009), Stephen Oronsaye intention was to have a civil service that would rank one of

the best organized and managed in the world. Oronsaye retired in November 2010 at the

statutory age 60 and was succeeded by Oladapo Afolabi (Idonor and Ovuakpori 2010).

Ethical Problems in Nigerian Civil Service

The problems of ethics in the public bureaucracy connote a situation whereby Civil servants

individually or collectively use their positions or appear to do so in a manner that is contrary

to public confidence and trust. Anger(2002), has pointed out that such unethical behavior has

to do with conflict of interests, loyalties or values; it could also be as a result of attempts to

achieve some forms of private gain to the detriment of the masses. In the course of policy

implementation, civil servants very often breach the ethical values of loyalty, courtesy,

respect, integrity and neutrality.

The problem of disloyalty refers to a scenario where an employee is unfaithfully or fails to

give support to an institution, organization or persons of super ordinate status. The unhealthy

relationship among civil servants is equally attributed to the problem of disloyalty. And this

to a large extent affects the achievement of the goals and objectives for which the service is

created. Manifestations of disloyalty include insubordination and like-warm attitude at work.

45
 Secondly, there is the problem of lack of courtesy and respect. Courtesy and respect are the

fundamental values required by all civil servants in dealing with the people it is however

disheartening to know that civil servants in Nigeria exhibits disrespect and uncourteous

behavior, hostile and unaccommodating tendencies as exemplified by the police. This writer

also experienced this anti-ethical behavior in some government establishments.

Another ethical problem is low sense of integrity among civil servants. This low sense of

integrity provides a fertile ground for pilfering and diversion of resources for private use,

falsification of contracts as well as leaking of official records and government classified

information. This is often attributed to poor pay package in the service.

Equally important as an ethical problems of the service is the problems of political neutrality.

Political neutrality is simply a reference to when civil servants involve themselves in partisan

politics. Often times this has affected the performance of civil servants on their jobs.

Problems of Accountability in Nigerian Civil Service

According to Beetseh (2014), the problem of accountability has become recurring phenomenon

in the Nigerian civil service; it has become a culture of the service. The manifestations of

problems of accountability include corruption, red-tapism, waste of human and material

resources. However, of all these manifestations, corruption is the most pronounced.

Corruption might take the form of underperformance, or neglect of a recognized duty, or the

unwarranted exercise of power, with the motive of gaining some advantages more or less directly

personal. According to Nye (1967:427),”Corruption is a behavior which deviates from the

forward duties of a public role because of private regarding pecuniary or status gain”. Corruption

occurs when an individual illegally or illicitly puts personal interest above the interests of others

46
and the ideals he or she is pledged to serve. In the Nigerian Civil Service, the causes of

corruption have a linkage to the nature and character of the Nigerian state that is characterized by

mass poverty, deprivation, exclusion and low level of development of the productive forces and

social relations of production.

There is also the problem of red-tapism, which is a reference to the strict adherence to the civil

service procedures, rules and regulations. Although rules and regulations themselves are good; it

is this inflexibility and strict adherence them that seems problematic. The rigorous sticking to

rules and procedures will sometimes lead to displacement of the goals of an organization. Indeed,

red-tapism is dysfunctional, restrictive and a drag to development.

The problems of waste of resources cannot be overemphasized, the unnecessary duplication of

government ministries and departments account for the massive waste of both human and

material resources. These problems have continued to overwhelmingly affect efficiency,

effectiveness and productivity in the Nigerian Civil Service. The service therefore, needs to

properly undergo a surgical operation rather than the usual palliative measures as solution to the

center.

47
2.5 Conceptual Model of the Study

Based on the objectives of this study, a conceptual model for the relationship between the

independent variable (Forensic Auditing) and the dependent variable (Nigeria Civil Service) was

developed thus;

DEPENDENT VARIABLE INDEPENDENT VARIABLE

Nigeria Civil Service Forensic Auditing

Fraud Reduction Forensic Audit

Improved Civil Service Performance

Forensic Audit Report

Effective Internal Control System

Source: Researcher’s Conceptual Model 2018

The table above diagrammatically explains the relationship between Nigerian Civil Service and

Forensic Auditing. Forensic auditing refers to the application of investigative and analytical

methods to gather evidence for use in a court of law to curb fraudulent practices. The first stage

48
of forensic auditing is the forensic audit. Forensic audit is the systematic process of defining the

engagement, discovery, gathering and analyzing evidence. The forensic auditor defines his or her

engagements through an engagement letter. The engagement letter identifies the responsible

parties, defines the nature of the relationship, identifies the limitation on the scope of work to be

performed and outlines specific terms. The acceptance/approval of the engagement letter by the

responsible parties will lead to the ignition of the discovery stage. The forensic auditor applies

his or her skills(technical, integrity, financial, analytical and investigative) to discover and gather

evidence which could be in the form of observation, interviews and confirmation of accounting

records. On gathering sufficient evidence, the forensic auditor analyzes the evidence through the

use of analytical methods. Having analyzed and interpreted the evidence collected, the forensic

auditor presents the result in an oral or written form to the interested users. The written form is

known as the Forensic Audit Report. The issuance of a forensic audit report by the forensic

auditor to the government will lead to drastic reforms in the Nigerian Civil Service, which will

give rise to fraud reduction, improved civil service performance and effective internal control

system.

2.6 Empirical Review

Akenbor and Oghoghomeh (2013) investigated the relationship between forensic auditing and

financial crime in Nigerian banks. The study revealed that the proactive approach to forensic

auditing helps in minimizing the risk of financial crimes in Nigerian banks. Based on the above,

it was recommended that forensic auditing department should be created in Nigerian banks to

initiate internal measures for fighting financial crimes; forensic auditing courses should be

introduced in Nigerian higher institutions of learning to provide the necessary skills and

49
knowledge on forensic auditing issues; and forensic auditors’ report of banks should be made

public.

Furthermore, another study by Akenbor and Ironkwe (2014) examined the relationship between

Forensic auditing and fraudulent practices in Nigerian public institutions. The study revealed that

both the proactive and the reactive forensic auditing technique have a negative significance

relationship with fraudulent practices in the Nigerian public institutions. Based on the above, it

was recommended that:1) the economic and financial crime commission (EFCC), The

independent corrupt practices and other related offences commission(ICPC), and other

anticorruption bodies in Nigeria should have in their payroll, internal forensic auditors to

supplement the duties of internal auditors; 2) forensic auditors should regularly undergo training

and development programs to acquaint them with relevant knowledge and skills for effective

forensic auditing; and 3) forensic auditing should be made mandatory for public institutions by

regulatory authorities rather than being voluntary.

Modugu and Anyaduba (2013) examined forensic accounting and financial fraud in Nigeria.

Specifically, the study examined if there is significance agreement among stakeholders on the

effectiveness of forensic accounting in financial fraud control, financial reporting and internal

control quality. The findings of the study indicated that there is significant agreement amongst

stakeholders on the effectiveness of forensic accounting in fraud control, financial reporting and

internal control quality and thus recommended that the Institute of Chartered Accountants of

Nigeria, Association of National Accountants of Nigeria and the National Universities

Commission should encourage formalization in the field of forensic accounting.

Finally, Eyisi and Agbaeze(2014) worked on the impact of forensic auditors in corporate

governance. The study was a theoretical research which considered the roles of forensic auditors
50
in combating fraudulent activities, distinction of forensic auditor and statutory auditor,

characteristics of forensic auditor and impact of forensic auditor on corporate governance. From

the studies carried out, the paper concluded that forensic auditors having improved management

accountability, strengthened external auditor, independence and assisting audit committee

members in carrying out their oversight functions by providing them assurance on internal audit

report have impacted positively on corporate governance, thereby reducing corporate failure and

impoverishment of investors.

2.7 Summary of Literature Review

The literature review has shown that fraud investigation is geared towards eliminating the system

weaknesses which will be used to prosecute perpetrators. It is established that fraud prevention

and detection are both management responsibility. However, forensic auditors should plan their

audit to be able to detect material misstatement.

It is revealed in the literature that both internal and external auditors must understand the

working of computer, if they are to audit the system effectively. Computers do not have security

proof to error and fraud, which is why these auditors should learn how to audit through the

computer and not around the computer.

Fortunately, problem of auditing through the computer has been resolved owing to development

of audit software. Unfortunately, the lack of training of staff of audit department and lack of

exposure to computer hardware, it is doubtful if they can cope with the audit associated with

computer in public sector or private auditing firms in Nigeria.

However, certain areas such as asset valuation, asset ownership, and management representations

as alleged by SEC(Securities and Exchange Commission) are areas where auditors fail to

51
properly assess inherent risk and adjust the audit program accordingly(Beasley, Carcello and

Hermanson:2001). Below are Audit Deficiencies, they are: Failure to exercise due professional

care and appropriate level of professional skepticism, overreliance on inquiry as a form of audit

evidence; Interpreting or applying requirements of GAAP; Designing audit programs and

planning engagement (inherent risk, issues, non-routine transactions, e.t.c.); Confirming accounts

receivable; and Relying too much on internal control.

The best way for audit firms and public sector audit departments to remedy such deficiencies is

to promote more involvement by audit firm executives, partners and managers in the planning

engagement. Also, to overcome these problems of computer literacy, adequate trainings should

be given to staff and appointment of professionals to head internal audit units of Ministries and

Departments.

The review of relevant literature went further to discuss public accountability which implies

stewardship and is the only means of accessing how management and government has used

resources for the overall benefit of the citizens. Financial accountability is measured by

observance of procedures relating to financial control cycles as an external control device on the

executive arm of government.

Finally, the literature review highlighted ethical and accountability problems in the Nigerian civil

service which affects the productivity and efficiency of the Institution.

52
 CHAPTER THREE

METHODOLOGY

Presented in this chapter is the research methodology and procedures adopted in obtaining the

requirement of the study. Examined herein includes sources of data, sample size, sampling

techniques and the methods of data analysis.

3.1 Methods and Sources of Data

In an attempt to come out with an enviable piece of work, data for this survey were generated

from primary sources. Primary data were generated from questionnaire, personnel interview and

observation.

3.2 Method of Data Collection

A well-structured questionnaire was designed and analyzed by us. The questionnaire was made

up of printed questions and the respondents are meant to fill answers in a manner that suggested

their individual opinion.

Then, the items of information that was collected emanated from the primary sources and was

equipped with the correct data which was analyzed and from which these reports were compiled

and also results were produced.

3.3 Research Population

In Nigeria, the number of officers in ministries, departments and agencies of the federal and state

government are infinite. Therefore, to aid this research, we selected Abia state civil service

commission as the population of the study. The documentary evidence of the commission on

53
consulted revealed that the personnel of the commission are 180 in number (see distribution

below).

Table 3.3.1 Personnel Distribution

S/No Categories Number of Personnel

1. Management staff Twenty(20)

2. Senior staff Seventy Four(74)

3. Junior staff Eighty Six(86)

Total One Hundred and Eighty(180)

Source: field survey, 2018.

3.4 Determination of Sample Size

The sample size was arrived at by the application of the understated statistical formula.

Formula: n = N/1+N(e)2
Where:
N = population size
e = percentage of the sample error
1= constant.
We have the following data:
N= 180 personnel as shown in Table 3.3.1 above, and e=percentage of sample error used is 5%.

54
Therefore,

n= 180
1+180(0.05)2
= 180
1+0.45
= 180
1.45
= 124

3.5 Instrument

The key instrumentation adopted to collect data was questionnaire. Questions contained in the

questionnaire were tested with regression technique to determine the validity of acceptance and

rejection of HO.

3.6 Validity and Reliability of the Instrument

To improve the reliability of the questionnaire in this study, the test and retest administration

approach was adopted. This meant that we administered the same group of respondent who react

to the question without encountering bias.

3.7 Sampling Technique

In administering the questionnaire to the respondents, we adopted random sampling method

which restricted the study to 124 civil servants since the study of the entire population of staff in

Abia State Civil Service Commission would be costly, time consuming and uncontrollable.

55
3.8 Method of Data Analysis

To analyze and present data generated from the field, we adopted the tabular, text and

diagrammatic method. In tabular method, we systematically arranged the facts and figures in

rows. Each table uses carefully given appropriate title and captioned accordingly. At the base of

each table, source reference will be presented. In effecting data analysis, we made use of

combination of descriptive statistics method such as sample percentages and ratio. Inferential

statistics employed to test the hypothesis will be the regression technique. This tool is a

statistically chosen yardsticks for data analysis and hypothesis testing.

56
 CHAPTER FOUR

DATA PRESENTATION, ANALYSIS AND DISCUSSION OF FINDINGS

This chapter of the study lays emphasis on data presentation, analysis and interpretations. The

first section covers the presentation of data on Forensic auditing and Productivity of Nigeria civil

service which includes fraud reduction, civil service performance, and effectiveness of internal

control system covered in this study.

4.1 Data Presentation

Table 4.1 Questionnaire Administration and Retrieval

Variables Responses Percentage

Returnable 92 74.19
Non-Returnable 32 25.81
Total 124 100
Source: field work; 2018

124 copies of questionnaire were issued, however, only 92 representing 74.19% of the sample

which is satisfactory. Thus, the analysis is based on 92 responses.

57
4.2 Descriptive Data Analysis

Table 4.2 Descriptive Analysis of fraud minimization

Responses
Fraud Reduction SA A N D SD
(5) (4) (3) (2) (1) TOTAL MEAN
1 92
Forensic Auditors have
19 30 31 9 3
helped to minimize fraud in (329) 3.58
(95) (120) (93) (18) (3)
the Nigeria Civil Service.
2 The financial controls 92
adopted by the government
(346) 3.76
following the presentation
of forensic audit report on 17 43 25 7 0
government institutions (85) (172) (75) (14) (0)
helped in the detection and
elimination of fraudulent
practices.
3 Forensic auditing have 92
addressed unethical
(366)
practices (contract inflation,
28 40 18 6 0 3.98
payment of ghost workers,
(140) (160) (54) (12) (0)
and failure to account for
revenue collected) in the
Nigeria Civil Service.
Source: field work 2018

The table above which analyses forensic auditing impact on fraud reduction in Nigeria civil

service, shows that under statement one; Forensic Auditors have helped to minimize fraud in the

Nigeria Civil Service with the mean of 3.58 which is higher than the cut-off point of 3.00 is

effective, the second statement on whether The financial controls adopted by the government

following the presentation of forensic audit report on government institutions helped in the

detection and elimination of fraudulent practices with mean score of 3.76 which is higher than

the cut-off point of 3.00 and the third statement which states if Forensic auditing have addressed

unethical practices(contract inflation, payment of ghost workers, and failure to account for

58
revenue collected) in the Nigeria Civil Service. It has a mean score of 3.98 which is higher than

the cut-off point of 3.00 is effective.

Table 4.3 Descriptive Analysis of Civil Service Performance

Responses
Civil Service Performance SA A N D SD
(5) (4) (3) (2) (1) TOTAL MEAN
4 The services rendered by 92
forensic auditors outweigh 16 34 34 4 4
(80) (136) (102) (8) (4) (330) 3.58
their cost.

5 Forensic audit report is 92

associated with high pay 19
39 27 5 2 (344) 3.74
package and increased (95)
(156) (81) (10) (2)
welfare in the Nigeria Civil
Service.
6 Adequate payment of 92
pension funds to
17 39 32 3 1 (344) 3.74
government retirees is
dependent on forensic (156) (96) (6) (1)
(85)
audit report.

7 Forensic auditing enhances 92

job satisfaction and 24 34 27 4 3 3.72
(342)
motivation in the Nigeria (120) (136) (81) (2) (3)
Civil Service.
Source: field work 2018

The table above which analyses the impact of forensic auditing on civil service performance,

shows that under the first statement in the table above; The services rendered by forensic

auditors outweigh their cost is effective with the mean of 3.58 which is higher than the cut-off

point of 3.00, second statement; Forensic audit report is associated with high pay package and

increased welfare in the Nigeria Civil Service with a mean score of 3.74 which is higher than the

cut-off point of 3.00. Third statement which states adequate payment of pension funds to

59
government retirees is dependent on forensic audit report has a mean score of 3.74 which is

higher than the cut-off point of 3.00 is effective.

The last statement in the table above which states Forensic auditing enhances job satisfaction

and motivation in the Nigeria Civil Service has a mean score of 3.72 which is higher than the cut-

off point of 3.00 which is reasonable.

Table 4.4 Descriptive Analysis of Effectiveness of Internal Control System in the Nigeria Civil
Service

Effectiveness of Responses
Internal Control SA A N D SD
System. (5) (4) (3) (2) (1) TOTAL MEAN
10 Forensic audit 92 3.57
strengthens internal
control system in the 8 46 28 10 0 (328)
Nigeria Civil Service. (40) (184) (84) (20) (0)

11 Forensic audit report 92

enhances internal
audit efficiency in 21 (361) 3.92
44 26 1 0
the Nigeria Civil (105) (176) (78) (2) (0)
Service

Source: field work 2018

The above table which analyses the Effectiveness of Internal Control System in Nigeria civil

service shows that under statement one Forensic audit strengthens internal control system in the

Nigeria Civil Service with a mean of 3.57 which is higher than the cut-off point of 3.00, second

statement which states Forensic audit report enhances internal audit efficiency in the Nigeria

Civil Service with mean score of 3.92 which is higher than the cut-off point of 3.00 is

reasonable.

60
4.3 Test of Hypothesis

In this section the three hypotheses stated in the first chapter of this research were tested using

multiple regression through the use of SPSS software to determine the extent to which the

independent variable influences the dependent variables in this study, that is, to determine the

predictive power of forensic auditing on the productivity of Nigeria civil service.

Hypothesis one

To test the hypothesis data on forensic auditing were regressed with data on fraud reduction in

Nigeria civil service and the result obtained is shown in the table below.

HO1; There is no significance relationship between forensic auditing and fraud reduction in the

Nigeria civil service.

Table 4.3 Impact of forensic auditing on fraud reduction

Change Statistics

R Adjusted R Std. Error of R Square Sig. F Durbin-

Model R Square Square the Estimate Change F Change df1 df2 Change Watson

1 .334a .000 -.011 .79565 .000 14.015 1 90 .003 1.507

a. Predictors: (Constant), Forensic Auditing

b. Dependent Variable: Fraud Reduction
Source; SPSS version 22

Table 4.3 above indicates a correlation co-efficient of 0.334 which shows that there is a slightly

high relationship between forensic auditing and fraud reduction in Nigeria civil service.

The F-ratio (14.015) and the P-value of (0.003) suggest that Forensic Auditing has a positive and

a significant relationship with fraud reduction at 5% level of significant. This suggests that the

null hypothesis is rejected.

61
We therefore concluded there is a significant relationship between Forensic Auditing and fraud

reduction in Nigeria civil service.

Hypotheses two

To test this hypothesis data on forensic auditing were regressed with data on civil service

performance and the result obtained is showed in the table below.

HO2: There is no significance relationship between forensic auditing and civil service

performance.

Table 4.4 Impact of forensic auditing on civil service performance

Change Statistics

Adjusted R Std. Error of R Square Sig. F Durbin-

Model R R Square Square the Estimate Change F Change df1 df2 Change Watson

1 .181a .033 .022 .75694 .033 3.054 1 90 .084 1.615

a. Predictors: (Constant), Forensic Auditing

b. Dependent Variable: Civil Service performance

Source: SPSS version 22

Table 4.4 above denotes a correlation co-efficient of 0.181 which shows that there is a weak

relationship between forensic auditing and civil service performance.

The F-ratio (3.054) and the P-value of (0.084) suggest that Forensic Auditing has a positive and

no significant relationship on civil service performance. This suggests that the null hypothesis is

accepted.

We therefore concluded that there is a no significant relationship between Forensic Auditing and

civil service performance.

62
Hypotheses three

To test this hypothesis data on forensic auditing were analyzed with data on effectiveness of

internal control system and the result obtained is shown in the table below.

HO3: There is no significance relationship between forensic auditing and effective internal

control system in the civil service.

Table 4.5 Impact of forensic auditing on effectiveness of internal control system

Change Statistics
Adjusted R Std. Error of R Square Sig. F Durbin-
Model R R Square Square the Estimate Change F Change df1 df2 Change Watson

1 .345a .119 .109 .66728 .119 12.142 1 90 .001 1.994

a. Predictors: (Constant), Forensic Auditing

b. Dependent Variable: Effectiveness of Internal Control System

Source: SPSS version 22

Table 4.3 above indicates a correlation co-efficient of 0.345 which shows that there is a slightly

high relationship between forensic auditing and effective internal control system in Nigeria civil

service.

The F-ratio (12.142) and the P-value of (0.001) suggest that Forensic Auditing has a positive and

a significant relationship with effective internal control system at 5% level of significant. This

suggests that the null hypothesis is rejected.

We therefore concluded there is a significant relationship between Forensic Auditing and

effective internal control system in Nigeria civil service.

4.4 Discussion of Findings

This study empirically examined Forensic auditing and Productivity of Nigeria civil service. It

revealed the relationship between forensic auditing and the dimensions of productivity (fraud

63
reduction, civil service performance and effective internal control system) in Nigeria civil

service.

The study found that Forensic Auditing has a positive and a significant relationship with fraud

reduction at 5% level of significant. This implies that forensic auditing will lead to fraud

detection process which tends to detect fraud and lead to the prosecution of perpetrators.

Forensic auditing helps to reduce the likelihood of committing fraud and thus minimizing fraud

in the Nigeria civil service which will enable the institution to efficiently manage its resources.

The study also showed that Forensic Auditing has a positive but no significant impact on civil

service performance. This denotes that although forensic auditing is positively related to enhance

civil service performance, it may not fully ensure adequate performance of the Nigeria civil

service in future periods. This is because of frequent changes of management team in

government institutions leading to setting of varying goals and objectives which often lead to the

misplacement of the overall objectives of the government. Therefore, civil service performance

can be enhanced effectively if the government is focused and performance-driven to initiate

reforms based on forensic audit report and the general public has a role to play by removing

irresponsible government from office through their votes to ensure the protection and

modernization of democratic institutions in particular the Nigeria civil service to meet global

standards of civil service institutions in advanced countries.

Finally, the study revealed that Forensic Auditing has a positive and significant relationship on

effective internal control system in the Nigeria civil service. This implies that forensic auditors

enhance the effectiveness of internal control system. By detecting fraud, forensic auditing will

expose unethical and fraudulent practices in the Nigeria civil service and thus exposing the

weaknesses of the institution’s (Nigeria civil service) internal control system. In order to correct
64
this anomaly, as opined by Akenbor and Ironkwe (2014) in their work on Forensic auditing and

fraudulent practices in Nigerian public institutions, government institutions should have in their

payroll, internal forensic auditors to supplement the duties of internal auditors.

65
 CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATIONS

The rising rate of fraudulent practices and other irregularities in government accounts and

financial statements portends significant harm to the organizations involved and the general

public at large. This has led to the emergence of forensic auditing as an instrument to manage

fraudulent practices.

Furthermore, the problem of determining the effectiveness of the internal control of the internal

control system in the Nigeria civil service is vital to the study. Generally, auditor’s operational

standard stated that auditors should ascertain and evaluate the adequacy of internal control and

perform compliance test on their operation. This research is being carried out to determine how

well forensic auditing enhances the effectiveness of internal control system in the civil service.

However, the study analyzed the problem of underperformance of the Nigeria civil service, and

the role played by forensic auditing in enhancing the performance of the institution.

Therefore, the introduction of forensic audit department in each ministry/department could be to

spot quickly any fraudulent act, thus complementing the effort of the Audit Department.

5.1 Summary of Research Findings

Data analyzed in chapter four fielded the following finds:

i. The internal control system is adequate except that civil servants in an attempt to show

faithfulness and obedience to their boss ignorantly and purposely break the already

designed control measures which often results to loss of government resources in terms

of materials, money and assets. Etc.

66
 ii. Forensic auditing is vital to the minimization of fraud in the Nigeria civil service. The

report of forensic auditor will lead to the exposure of unethical and fraudulent practices in

the civil service, and thus prosecuting the perpetrators. This helps to reduce the likelihood

of fraud occurrence in the civil service.

iii. The findings of the study revealed that the problem of underperformance in the Nigeria

civil service may not be fully corrected by forensic auditing. Thus, the problem of civil

service underperformance will be corrected based on the corporation of other factors

(General public pressure, level of sincerity on the part of the government) with forensic

auditing.

iv. Also, where the system of internal control requires the segregation of duties. It is

important to ensure that no one person carries out the three aspects of any transaction

which are authorization, custodial and reporting.

5.2 Conclusion

This research examined Forensic auditing and Productivity of Nigeria civil service and

conclusions were drawn based on the findings of the study that forensic auditing will minimize

fraud and enhance internal control effectiveness system in the civil service.

Forensic auditing is seen as encapsulating all the other areas in the use of auditing for

investigative purposes. The increasing sophistication of crimes in the civil service requires the

services of forensic auditor to bring about the successful investigation and prosecution of those

individuals involved in fraudulent practices. The increasing need of forensic auditing in the civil

service results from the nature of modern day civil service involves large volume of complex

data (government employee, electronic payroll system, government budget, government project

67
reports) which makes it difficult to monitor those transactions by applying manual audit

processes. This in turn makes the control utility of auditing ineffectual.

Virtually all the weaknesses and challenges identified in the Nigeria civil service, and criminal

investigations and persecution arising from them, are issues for forensic auditing. The general

expectation is that forensic auditing may offer some respite to the seeming vulnerability of

conventional accounting and audit systems to financial and non-financial fraud.

Consequently, the incorporation of modern forensic auditing techniques in an audit in Nigeria is

seen as timely in order to prepare the accounting profession to deal effectively with the problem

of unraveling ingenious fraud schemes arising from audit failures to detect frauds in Nigeria.

Finally, forensic auditing is seen as the key to effective internal control system in the civil

service. Since the applicability of internal audit will not fully enhance the effectiveness of

internal control system, forensic auditors are engaged to complement the work of internal

auditors. This tends to enhance the effectiveness of internal control system in the civil service.

5.3 Recommendations

The essence of forensic auditing practice is the minimization of fraud in the civil service.

Therefore, it is recommended in this study based on the above findings and discussions that:

a. Forensic auditors should be engaged or employed by the government to examine and

address allegations of fraud and misconduct in the Nigeria civil service.

b. Forensic audit department should be created in government ministries to complement the

work of internal auditors in order to enhance the effectiveness of internal control system

in the Nigeria civil service.

68
c. In order to ensure adequate performance of the civil service, government should be

focused and performance driven to initiate reforms and drastic measures based on

Forensic audit report, in order to advance the productivity and efficiency of the Nigeria

civil service.

d. A good system of internal control requires that in the Nigeria civil service each person in

the course of performing his duties as a check on another whom also automatically

checks the earlier person in the performance of his own duties. This arrangement prevents

one person or both to commit fraud and conceal their actions by falsifying the records.

e. Forensic auditors should regularly undergo training and development programs to

acquaint them with relevant knowledge and skills for effective forensic auditing.

f. The results of the forensic auditor’s findings on government institutions should be made

available to all relevant legislative bodies at all government levels, at least annually.

These findings become public knowledge once the audit reports have been tabled and the

general public has access to them. The media releases on the findings of forensic auditors

will serve as a deterrent to fraudulent practices in the Nigeria civil service.

69
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72
 APPENDIX

Department of Accounting,

Faculty of Management Sciences,

Federal University Otuoke,

PMB, 126, Yenagoa,

Bayelsa State.

July,2018.

Dear Sir/Madam,

REQUEST FOR YOUR COOPERATION IN COMPLETING THIS QUESTIONNAIRE

I am a final year student of the above named department and institution. The questionnaire is for

my research on “Forensic Auditing and Productivity of Nigeria Civil Service”. Please kindly

answer the questions below and be rest assured that all answers will be held in strict

confidentiality.

Thank you in anticipation of your cooperation.

Yours Faithfully,
AMAH KINGSLEY CHINENYE
FUO/14/ACF/1055

73
 QUESTIONNAIRE

Instruction: Please tick ( ) in the answer(s) you consider appropriate to the question(s) asked.

Where statements are required, please state them briefly.

Section A: Personal Data

Sex: Male Female

Position/Designation:____________________________________________________

How many years have you worked in Abia State Civil Service Commission?

Below 10 years Above 10 years

Section B

Fraud Reduction Responses

Strongly Agree Neutral Disagree Strongly
Agree
Disagree

Forensic Auditors have helped to minimize fraud

in the Nigeria Civil Service.
The financial controls adopted by the
government following the presentation of
forensic audit report on public institutions
helped in the detection and elimination of
fraudulent practices.
Forensic auditing have addressed unethical
practices (contract inflation, payment of ghost
workers, and failure to account for revenue
collected) in the Nigeria Civil Service.

74
Civil Service Performance Responses
Strongly Agree Neutral Disagree Strongly
Agree Disagree
The services rendered by forensic auditors
outweigh their cost.
Forensic audit report is associated with
high pay package and increased welfare in
the Nigeria Civil Service.
Adequate payment of pension funds to
government retirees is dependent on
forensic audit report.
Forensic auditing enhances job satisfaction
and motivation in the Nigeria Civil Service.

Effectiveness of Internal Control System Responses

Strongly Agree Neutral Disagree Strongly
Agree Disagree
Forensic audit strengthens internal control
system in the Nigeria Civil Service.
Forensic audit report enhances internal
audit efficiency in the Nigeria Civil
Service.

Key
Strongly Agree = 5
Agree = 4
Neutral = 3
Disagree = 2
Strongly Disagree = 1

75
Table 4.1 Questionnaire Administration and Retrieval

Variables Responses Percentage

Returnable 92 74.19
Non-Returnable 32 25.81
Total 124 100
Source: field work; 2018

Table 4.2 Descriptive Analysis of Fraud Reduction

Responses
Fraud Reduction SA A N D SD
(5) (4) (3) (2) (1) TOTAL MEAN
1 92
Forensic Auditors have
19 30 31 9 3 (329) 3.58
helped to minimize fraud in
(95) (120) (93) (18) (3)
the Nigeria Civil Service.
2 The financial controls 92
adopted by the government
(346) 3.76
following the presentation
of forensic audit report on 17 43 25 7 0
government institutions (85) (172) (75) (14) (0)
helped in the detection and
elimination of fraudulent
practices.
3 Forensic auditing have 92
addressed unethical
(366)
practices (contract inflation, 3.98
28 40 18 6 0
payment of ghost workers,
(140) (160) (54) (12) (0)
and failure to account for
revenue collected) in the
Nigeria Civil Service.
Source: field work 2018

76
Table 4.3 Descriptive Analysis of Civil Service Performance

Responses
Civil Service Performance SA A N D SD
(5) (4) (3) (2) (1) TOTAL MEAN
4 The services rendered by 92
forensic auditors outweigh 16 34 34 4 4
(80) (136) (102) (8) (4) (330) 3.58
their cost.
5 Forensic audit report is 92
associated with high pay
19 39 27 5 2 (344) 3.74
package and increased
(95) (156) (81) (10) (2)
welfare in the Nigeria Civil
Service.
6 Adequate payment of 92
pension funds to
39 32 3 1 (344) 3.74
government retirees is 17
dependent on forensic (156) (96) (6) (1)
(85)
audit report.
7 Forensic auditing enhances 92
job satisfaction and 24 34 27 4 3 3.72
(342)
motivation in the Nigeria (120) (136) (81) (2) (3)
Civil Service.
Source: field work 2018

Table 4.4 Descriptive Analysis of Effectiveness of Internal Control System in the Nigeria Civil
Service

Effectiveness of Responses
Internal Control SA A N D SD
System. (5) (4) (3) (2) (1) TOTAL MEAN
10 Forensic audit 92 3.57
strengthens internal 8 46 28 10 0 (328)
control system in the (40) (184) (84) (20) (0)
Nigeria Civil Service.
11 Forensic audit report 92
enhances internal
21 44 26 1 0 (361) 3.92
audit efficiency in
(105) (176) (78) (2) (0)
the Nigeria Civil
Service
Source: field work 2018
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Table 4.3 Impact of forensic auditing on fraud reduction

Change Statistics

R Adjusted R Std. Error of R Square Sig. F Durbin-

Model R Square Square the Estimate Change F Change df1 df2 Change Watson

1 .334a .000 -.011 .79565 .000 14.015 1 90 .003 1.507

a. Predictors: (Constant), Forensic Auditing

b. Dependent Variable: Fraud Reduction
Source; SPSS version 22

Table 4.4 Impact of forensic auditing on civil service performance

Change Statistics

Adjusted R Std. Error of R Square Sig. F Durbin-

Model R R Square Square the Estimate Change F Change df1 df2 Change Watson

1 .181a .033 .022 .75694 .033 3.054 1 90 .084 1.615

a. Predictors: (Constant), Forensic Auditing

b. Dependent Variable: Civil Service performance

Source: SPSS version 22

Table 4.5 Impact of forensic auditing on effectiveness of internal control system

Change Statistics

Adjusted R Std. Error of R Square Sig. F Durbin-

Model R R Square Square the Estimate Change F Change df1 df2 Change Watson

1 .345a .119 .109 .66728 .119 12.142 1 90 .001 1.994

a. Predictors: (Constant), Forensic Auditing

b. Dependent Variable: Effectiveness of Internal Control System

Source: SPSS version 22.

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