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Project Topic:

AUDIT AS AN AID TO ACCOUNTABILITY (A CASE STUDY OF ENUGU STATE MINISTRY OF FINANCE AND ECONOMIC DEVELOPMENT)

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 Format: MS WORD ::   Chapters: 1 - 5  ::   Pages: 90 ::   Attributes: Abstract, Table Of Content, Questionnaire, Data Analysis  ::   134 people found this useful

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ACCOUNTING UNDERGRADUATE PROJECT TOPICS, RESEARCH WORKS AND MATERIALS

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ABSTRACT

The research study is concentrated an audit as an aids to accountability in public service. The project research commences with an introduction and over view of the history of audit in Nigeria. Sequel to this effect, data were collected from primary and secondary sources, primary sources involves the design and distribution of questionnaires to 106 respondents of the ministry of finance and economic departments and Enugu State Audit. The secondary source extensively reviewed the opinion of some scholars who had earlier drawn written conclusions that are related to the project topic. Data collected were analysed and tested using percentage and formulated hypotheses.

The main findings were based on the analysis and subsequent test, which showed that auditing is a strong tool for accountability in the public service. Poor and irregular payment of staff salaries and remuneration has caused diversion of public fund to private purposes. Moreover, management skill has not improved operational standard in the state service.

Based on the findings, the researcher made possible recommendations to correct the negative conception of an audit and to appraise audit standard in the state public service.

This project research is therefore, beneficial to both the students, lecturers, politician, public and private sectors.

 

CHAPTER ONE

INTRODUCTION

The question on how to increase efficiency and positive result in audit work in public sector is a perennial problem in Nigeria, and one that is increasing warning the generality of the people of this country. The response has been to upgrade the quality of audit staff ad powers conferred on audit institutions in the public sector. There is also the for training of audit staff in modern techniques of auditing to enhance effectiveness and result oriented rather than restricting them to the traditional methods of trick and turnover which is inadequate and outdated. 

Public sector auditing is conferred towards ensuring the proper and efficient use of public funds, development of sound financial management, the orderly executive administrative activities and the communication of information to the public through the publication of objective reports. These are necessary for the stability and development of the nation. There is a need to map out the machineries and method of carrying out a research functions effectively as to achieve a desired result.

In the past, the emphasis of an audit was on the traditional approach which ha been mainly the compliance audit to ensure that all books and records comply with the laid down procedures and regulation. But in the modern time, there is the need for a shift of emphasis to modern concept of effectiveness and efficiency.

Based on these individual views of auditing and its functions, the researcher took a keen inherent to rest empirically auditing as an aid to accountability with a particular reference to Enugu State Ministry of Finance and economic development.

The increase incidence of fraud and misappropriation of public fund and property by the accounting officers and chief executives in the public sector/ service passes a question as to whether auditing plays any role towards ensuring proper accountability in the public service especially the state government and particularly the ministry of finance and economic development.

Auditing is to control, deter and find out any fraud or misappropriation of public fund or property by officers entrusted with such duties.

It is because of this onerous task that the Enugu state audit department was established to appraise the work of those entrusted with responsibility of accountability.

Government undertakes various transactions through its representatives or agencies and as such, they are required by law to give account of their stewardship. To achieve these purposes, the constitution of the Federal Republic of Nigeria provides a law established audit department both at the Federal and State levels. Section 125 (1) of the 1999 constitution provides that there shall be an Audit General for the federation and for each state of the federation who shall be appointed in accordance with the provision of section 126 of this constitution. The sub-section (2) of this section provides that the public accounts of a state and all offices, ministries, parastatals, and the courts of the state shall be audited by the auditor-general for the state who shall submit his reports to the House of Assembly of the state concerned. Therefore the auditor general or any person authorized by him in that behalf shall have access to all the books, records, returns, and other documents relating to those accounts. The sub-section (2) (3) of this constitution shall be constrained as authorizing the auditor-general to auditor-general to audit the accounts of or appoint auditor for government statutory corporations, commissions authorities, agencies, including all persons and bodies established by law but the auditor general shall, (a) provide such bodies with,

(i)      A list of auditors qualified to be appointed by them as external auditors and from which the bodies shall appoint their external auditors and;

(ii)     A guideline on the level of dues to be paid to the external auditors and;

(iii)    Comments on their annual accounts and auditor’s report there on. The sub-section (4) of this constitution also states that the auditor-general for the state shall have power to conduct a periodic check of all government statutory corporations,                

Commission, authorities, agencies, including all persons and bodies established by a law of the House of Assembly of the state.

 Inspite of all these provisions and safeguards, there is always an increased rate of fraud and misappropriation of public funds and parties by those entrusted with their safeguards. In view of the foregoing, this study is aimed at appraising the functions of the Enugu state audit department, problem affecting its efficiencies performance, and suggested solutions to enhance its effectiveness.

The researcher aims to examine the major cause of fraud or misappropriation of public funds in the state public service and offer useful suggestions to arrest the ugly situation. This study will also be of immense important for it will appraise the performance of the Enugu state audit department and assess the extent it has been able to achieve its objectives. The researcher will in addition offer valuable solutions on how to achieve accountability in the state public service.

The origin of audit department is as old as Nigeria. The present Enugu state audit department had its root from the colonial administrations. During colonial administration, there was one audit in the federation known as the colonial audit. The colonial masters have their representatives in Nigeria. These representatives were responsible and report to the Queen of England. The country was divided into four Regions as follows: Northern Region, Southern Region, Eastern Region and Western Region. Each of the regions had its own audit department but reports under the control of the colonial administration. This gives rise to regional audits.

Section 61 (1) of the Eastern Nigeria 1958, constitution states, and “There shall be a director of audit for the region whose office shall be an office in the public services of the region. In 1976 there was a further creation of states in the country and it was then that Anambra state and Imo states was created from the former Eastern central state. In 1992, the old Anambra state was further divided into Anambra state and the present Enugu state. Following this, each state now has her own audit department with a director of Audit or Auditor general of the state. The state was empowered by section 25 (2) of the 1999 constitution of the Federal Republic of Nigeria and section 4 (2) of chapter 13 of the audit law to have its audit department. The internal audit department in the ministry of Finance and economic development is being leaded by the state auditor-general.

1.1     STATEMENT OF PROBLEMS

There has been an entry of poor accountability in the public service particularly Enugu state civil service of Nigeria. There has been various radio and television news and the report from the daily newspapers about fraud, embezzlement of public fund and misappropriation of public properties. Enugu state government is loaded with a lot of financial burden and as such has decided to discontinue the increasing rate of fraud and misappropriation of public properties in the state.

The problems audit affects  both the management and units, the shareholders, board of directors, researchers businessman/ sole proprietors, investors and the general public. From the viewpoint of misconceptions, superstitions, and prejudices of auditing and its function, the problem includes the following:

(1)     Inadequate auditing lead to misappropriations, embezzlements and insincere in public service.

(2)     There is existence of inadequate and irregular payment of staff salaries and remunerations in the state.

(3)     There is general lack of information from the officer in the state ministries.

(4)     Lack of management skills hinders proper auditing practices in the state.

(5)     Improper appointment and poor delegation of authority has contributed immensely to the mismanagement and poor performance appraisal in the state.

1.2     PURPOSE OF THE STUDY

The major aim of this research work is to evaluate and identify:

i.        The performance and achievements of external and internal audit departments in protection of public funds and properties.

ii.       The extent of compliance with the financial regulations on how to operate public funds.  

iii.      The effectiveness and implementations of an auditor’s report.

iv.      To ascertain how poor and irregular payment of staff salaries and remunerations affects auditing practice in the state ministry.

v.       To ensure that valuable and adequate information is provided to the auditors for proper auditing.

1.3     SCOPE OF THE STUDY

The scope of the research study is centered on the usefulness of auditing in public sector titled, “Auditing as an aid to accountability with a particular reference to the ministry of Finance and Economic Development, Enugu State.

1.4     RESEARCH HYPOTHESES FORMULATED

In order to achieve a reasonable conclusion in the study, it is very essential to formulate a set of testable hypotheses on available data as to ensure a true and fairness of the study as follows:

(i)      Ho:     Auditing is a tool for accountability in the public service especially Enugu state ministry.

          H1:     Auditing is not a tool for accountability in the public service especially Enugu state ministry.

(ii)     Ho:     Improper auditing has lead to misappropriation, embezzlement, and defalcation of fund.

          H1:     Improper auditing has not lead to misappropriation, embezzlement, and defalcation of fund.

(iii)    Ho:     Poor and irregular payment of staff salaries and remuneration have caused diversion of public fund to private purposes.

          H1:     Poor and irregular payment of staff salaries and remuneration have nor caused diversion of public fund to private purposes.

(iv)    Ho:     Management skill has improved operational standard of audit in public service.

          H1:     Management skill has not improved operational standard in public service.

1.5     SIGNIFICANCE OF THE STUDY

The growing nature of Nigerian society and the complexity of government operations have today give birth to frequent less of public fund. This losses compelled government to set up a good number of tribunals and special investigation panels (SIP) to carry out findings on the causes of such less of public fund. The important of this research will be of a great aid to find permanent solutions to the problem in audit practices and programmes.

The solutions will increase the effectiveness and efficiency of audit in the public sector. This research work will in addition highlight the functions and roles of auditing in our society and particularly to the auditor’s in the ministry.

More so, the concept of compliance and efficiency were properly examined to guide the auditors during audit investigations and practices. The auditors were exposed to legal constitutional rights, which empowered them to form auditor’s opinions without fear of favour in their areas of operations. The research study will in-addition appraise the usefulness of establishing internal audit department in various ministries and parastatals. It will also enable the directing boards and various heads of establishments make provision for adequate and regular payments of staff salaries and remunerations. The management of both public and private sectors were equipped with the usefulness need to establishing adequate internal checks that will certify the efficiency and effectiveness of their internal control system so as to ensure auditing as an aid to accountability.

1.7     DEFINITION OF SOME TECHNICAL TERMS

It is very eminent to define some professional terms and language used in this research work for easy understanding to interesting readers of other disciplines.

 

PUBLIC FUND

This is the government independent and accounting entity with a self-balancing set of accounts recording cash and or other resources together with all related liabilities, segregated for the purpose of carrying or dealing with specific activities and to attaining certain objectives in accordance with special regulation, restrictions or limitations.           

AUDIT

Ajembi O.A. (1999) describes audit as an examination by an individual or a firm of a set of financial statement and to the underlying books and records, which result the auditing provides an opinion on the financial statement.

ACCOUNTABILITY

This is defined as the process of keeping and documenting all the relevant data of an event.

STEWARDSHIP ACCOUNT

This is an account required of a person or agent responsible to render or disclose information to the person they are subordinate to the management of a firm, board of directors, and executives of the government.

COMPLIANCE TEST OR AUDIT

This means a kind of audit method carried to ensuring that all books and records are in agreement with the laid down procedures and regulation.

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