THE SIGNIFICANCE OF AUDITING FOR ENHANCEMENT OF ACCOUNTABILITY IN PUBLIC SECTOR A STUDY OF AKWA IBOM STATE AUDITOR-GENERAL OFFICE UYO
TABLE OF CONTENTS
Cover page
Title page
Declaration – – – – – – – i
Certification – – – – – – – – ii
Dedication – – – – – – – – iii
Acknowledgement – – – – – – – iv
Abstract – – – – – – – – – v
Table of content – – – – – – – vi
CHAPTER ONE:
1.0 Introduction – – – – – – 1
1.1 Background of the study – – – – 7
1.2 Statement of the Problem – – – – – 12
1.3 Objectives of the Study – – – – – 13
1.4 Research Questions – – – – – – 14
1.5 Significance of the study – – – – – 15
1.6 Scope of the study – – – – – – 16
1.7 Limitation of the Study – – – – – 16
1.8 Definition of Terms and Acronyms. – – – 17
CHAPTER TWO: REVIEW OF RELATED LITERATURE
2.1 Introduction – – – – – – – 20
2.2 Meaning and scope of audit – – – – 21
2.3 Classes of audit – – – – – 23
2.4 Evolution of Auditing – – – – – 28
2.5 Characteristics of good internal control – – 31
2.6 Application of internal control – – – – 33
2.7 Theoretical Framework – – – – – 56
CHAPTER THREE: RESEARCH DESIGN AND PROCEDURES
3.1 Introduction – – – – – – – 59
3.2 Area of the Study – – – – – – 59
3.3 Population of the Study – – – – – 60
3.4 Sample Determination and Sampling Techniques 60
3.5 Sources of Data – – – – – – 62
3.6 Method of Data Collection – – – – – 62
3.7 Data Presentation and Analysis Method. – 63
CHAPTER FOUR: PRESENTATION AND ANALYSIS OF DATA
4.1 Introduction – – – – – – – 64
4.2 Data Analysis and Result – – – – – 64
4.3 Discussion of Findings – – – – – 76
CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 Introduction – – – – – – – 80
5.2 Summary of the findings – – – – – 80
5.3 Conclusion – – – – – – – 82
5.4 Recommendations – – – – – 83
REFERENCES
APPENDICES
CHAPTER ONE
1.0 Introduction
Auditing can be defined as an independent examination of and expression of opinion on the financial statements of an enterprise by an appointed auditor in pursuance of that appointment and in compliance with any relevant statutory obligation.
The institute of chartered Accountant in England and Wales defined auditing as
“the independent examination and investigation of the books, accounts and vouchers of a business with a view to enabling the auditor to report whether the balance sheet and profit and loss account are properly drawn up so as to show a true and fair view of the state of affairs and the profit and loss of the business according to the best of the information and explanation obtained by the auditor”
The auditor is an individual or firm carry out the audit of the enterprise and the partners of such individual staff acting within delegated authority. The auditor is an independent professional who must not only be independent in mind but must be seen to be independent judging from the fact that he does not have interest in the company he is auditing and does not conduct an audit of a company owned by any of his blood relation or relatives. The primary aim of an audit is to enable the auditor to say “these account show a true and view” or of course to say” that they do not”
The objects of an audit are summarized as:
Audited account carry greater authority to the federal board of inland Revenue than unaudited accounts. Thus the inspectors of taxes will accept an audited account as the basis for computing the amount of profits fro assessment of income tax. This is also the case with financial institution prospective investors and analysts. Audited accounts provide the necessary preliminary basis for successful negotiations if it is desired to raise loan. Capital or obtain extended credit from a creditor or if it is desired to sell a business or to convert into a limited company. An audit is compulsory for companies as provided by the companies and Allied matters Act 1990. It therefore affords that shareholders an assurance that the directors have conducted the company’s affairs in the interest of the whole body of shareholders and have not abused their position of trust Auditing prevents disputes between partners of a firm in case of death of a partner, admission of new partners or ateration of profit sharing ratio Auditing has gone through various stages of development, vouching verification and systems approach.
Vouching approach: this is the first stage. It is typified by checking and ticking of quantities of transactions and documents to ensure that they have been recorded accurately and correctly. It is used in very small audits where the transactions are not too large. It is also suitable in specialized audits such as trusts and estates and where internal control system is weak or not in existence.
Through vouching the auditor certifies that the
This is the second stage and it involves the direct verification by independent means of assets, liabilities, income, expenses, and other matters of concern to the auditor.
This helps the audit to device the independent means of verifying the existence ownership and valuation of assets. There is emphasis on supporting evidence originating from outside the business hence verification of debtors and creditors through circulation, cash verified through physical count.
Systems or operating review approach: this is the most recent and it dominates auditing today. The approach stresses the importance of the existence of an accounting system and related internal control as an indication that the financial statements produced from the system are as reliable as the system itself
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