THE USEFULNESS OF FORENSIC AUDIT IN THE DETECTION AND PREVENTION OF FRAUD WITH REFERENCE TO YOUR FIDEI POLYTECHNIC

THE USEFULNESS OF FORENSIC AUDIT IN THE DETECTION AND PREVENTION OF FRAUD WITH REFERENCE TO YOUR FIDEI POLYTECHNICamp;lt;pamp;gt;CHAPTER ONEamp;lt;/pamp;gt;amp;lt;pamp;gt;INTRODUCTIONamp;lt;/pamp;gt;amp;lt;pamp;gt;1.1 BACKGROUND OF THE STUDYamp;lt;/pamp;gt;amp;lt;pamp;gt;The incidence of fraud and misappropriation of funds in recent time poses a threatamp;lt;/pamp;gt;amp;lt;pamp;gt;to auditing as a branch of accounting profession because of its perennial nature.amp;lt;/pamp;gt;amp;lt;pamp;gt;This has resulted to questions as to whether auditing actually play any significantamp;lt;/pamp;gt;amp;lt;pamp;gt;role towards the attainment of accountability and prevention of fraud especiallyamp;lt;/pamp;gt;amp;lt;pamp;gt;that which is currently happening in our major or key financial institutions.amp;lt;/pamp;gt;amp;lt;pamp;gt;Most of our financial institutions today fail to recognize that the phenomenonamp;lt;/pamp;gt;amp;lt;pamp;gt;fraud can appear to be more dangerous when compared to other forms ofamp;lt;/pamp;gt;amp;lt;pamp;gt;problem like armed robbery attack which can only affect the institution within aamp;lt;/pamp;gt;amp;lt;pamp;gt;short period of time, such may have no long term effect on their operations.amp;lt;/pamp;gt;amp;lt;pamp;gt;However, any significant fraud committed in an institution, not only undermines oramp;lt;/pamp;gt;amp;lt;pamp;gt;shakes up its financial stability but can severely affect the reputation of theamp;lt;/pamp;gt;amp;lt;pamp;gt;institution thereby resulting to investors loss of confidence.amp;lt;/pamp;gt;amp;lt;pamp;gt;Forensic auditing or accounting is the specialty practice area of accounting that describes engagements that results from actual or anticipated disputes or litigation. forensic means suitable for use in a court of law and it is to that standard and potential outcomes that forensic accountants also referred to as forensic auditors or investigative auditors, often have to give expert evidence at the eventual trial of companies and institutions who have committed fraud, in a court of law.amp;lt;/pamp;gt;amp;lt;pamp;gt;amp;lt;/pamp;gt;amp;lt;pamp;gt;1.2 STATEMENT OF THE PROBLEMamp;lt;/pamp;gt;amp;lt;pamp;gt;This topic the usefulness of forensic auditing in prevention and detection of fraud was conducted to focus on most important problems facing a corporate organization. The failure of statutory audit to prevent and reduce misappropriation of corporate and an increase in corporate crimes has put pressure on the professional accountant and legal practitioner to find a better way of exposing this evil frame in business world such as.amp;lt;/pamp;gt;amp;lt;pamp;gt; The problems of loss of customers/depositorsamp;lt;/pamp;gt;amp;lt;pamp;gt; The persistent increase in business failures fuelled or encouraged by frequent incessant fraudulent activities in our financial institutions.amp;lt;/pamp;gt;amp;lt;pamp;gt; The problem of lack of confidence on the part of the investing public to commit their resources to financial institutions due to fraud.amp;lt;/pamp;gt;amp;lt;pamp;gt; The problem of how financial institutions to embrace forensic audit as a useful tool in prevention and detection of fraud.amp;lt;/pamp;gt;amp;lt;pamp;gt;amp;lt;strongamp;gt;amp;lt;/strongamp;gt;amp;lt;/pamp;gt;amp;lt;pamp;gt;amp;lt;strongamp;gt;1.3 STATEMENTOF THE OBJECTIVESamp;lt;/strongamp;gt;amp;lt;/pamp;gt;amp;lt;pamp;gt;The general objective of this study is to inculcate the knowledge of forensic auditing in preventing and detecting corporate fraud in Nigeria. Though the main objective of forensic auditing will vary according to the purpose of hiring individual or entity, the essence of this study is to employ the new knowledge to uncover fraud, crimes and evasions of financial obligations or malpractices committed through manipulation of accounting records. The specific objectives of this study are as follows;amp;lt;/pamp;gt;amp;lt;pamp;gt; To establish the reason for the loss of customer/depositorsamp;lt;/pamp;gt;amp;lt;pamp;gt; To investigate how incidence of fraud, encourages or leads to business/bank failuresamp;lt;/pamp;gt;amp;lt;pamp;gt; To examine the reason behind investors loss of confidence toward investing or depositing in financial institutions;amp;lt;/pamp;gt;amp;lt;pamp;gt; To ascertain how forensic audit has been a useful tool in prevention and detection of fraud in our financial institutionsamp;lt;/pamp;gt;