Internal Control System As A Means Of Preventing Fraud In Nigeria Financial Institution. Source www.projectng.com
ABSTRACT

This research work was the internal control system as a means preventing fraud in Nigeria financial institution. The study was necessary because of the increasing wave of financial fraud in Nigeria in resent time as reported by the Niger dailies. Therefore the need to investigate these reports and if confirmed, a financial institution and to what extent the application of an effective internal control system can go to help matter. All aspect of this work is very relevant in one way or the other to the Nigeria financing industries, as a whole, and for those who may be interested in carrying out further study in this topic. Also data were collected through primary and secondary sources, the primary and secondary serious, the primary source of data are mainly through personal interview and of questionnaires while the secondary include Books, Newspapers, magazines. From my financial it was ascertained that financial institution have the best internal control system in Nigeria. The internal system is both adequate and effective, although more operating improvement and review vital. The management of the financial institution should be at alert so as to chose any loophole that may arise in their internal control system. Also, it was discovered that the major cause of fraud is the employment of dishonest staff. Therefore staff quality like integrity should be ascertained before employment. The should be an increased enlighten on the legal implications of fraud among other.


TABLE OF CONTENTS

Title page i

Approval page ii

Dedication iii

Acknowledgement iv

Abstract v

Table of contents vi

CHAPTER ONE

1.0 Introduction 1

1.1 Background of the Study 1

1.2 Statement of the Problems 5

1.3 Purpose of the Study 8

1.4 Research Question 9

1.5 Research Hypothesis 10

1.6 Scope of the Study 12

1.7 Limitation of the Study 12

1.8 Significance of the Study 13

1.9 Definition of Terms 14


CHAPTER TWO

2.0 Review of Related Literature 17

2.1 Definition of Fraud 19

2.2 Types and Causes of Financial Institution 20

2.3 Concept and Definition of Internal Control system 27

2.4 Types of controls 37

2.5 Internal control system in Financial 43

References/Note 52

CHAPTER THREE

RESEARCH DESIGN AND METHODOLOGY

3.1 Research Design 55

3.2 Area of the study 56

3.3 Population of the study 57

3.4 Sample size determination 58

3.5 Research instrumentation 59

3.6 Validity 60

3.7 Reliability 62

3.8 Source of data 62

3.9 Analysis Techniques 64

References 65

CHAPTER FOUR

4.1 Data Presentation and Analysis 66

4.2 Test of Hypothesis 71

CHAPTER FIVE

5.0 Summary of findings, conclusion and Recommendation 80

5.1 Findings 80

5.2 Conclusion 80

5.3 Recommendation 82

Bibliography/Reference

Appendix I

Appendix II







CHAPTER ONE



1.0 INRODUCTION

1.1 BACKGROUND OF THE STUDY

It is feared that the inability of management to ensure effective enforcement to rules and regulation have rendered that operation of internal control system s the Banking industry open to abuse. The net effect could be that every one carries out his schedule off duties in any manner he likes which consequently gives those wishing to commit fraud their long expected golden opportunity.

Prior to 1952, there was no form of Banking art or ordinance to regulate the establishment and operations of Commercial Banks or a Central Banks to supervise the control of Banking Nigerian. During that time many Banks was registered some of which never operated and even since that period, fraud has remained a permanent feature in out Banking industry. This resulted in the loss of faith and trust in the financial institutions by Nigeria and consequently, under-development of the banking habit in the country.

However with the introduction of the first banking ordinance in 1952, and the central Bank of Nigeria (CBN) Act in 1959 and other subsequent Acts and ordinances with their amendments over the years, used to regulate and control the activities and operations of financial institutions in the country, fraud in financial institution have rather increased in magnitude and the methods used to perpetrate them acquire greater sophistication day after day. Now with the introduction of modern procedures and advancement in information technology such as those in communication system, automatic electric gadgets and computer into the banking system coupled with the various precautionary measures taken by bank agent, fraud have rather taken nuclear dimensions and the size of sums involved increased at a geometric rate and also with the held of Anipkitan (1976) a banker of repute, I Ashimi (1976, p6) a banker of prudent, Ughamadu N. (1991) observed to be liable in its banking sector and be very porous to fraud and many others who have contributed to maintain a prudently measured to the ascertainment of financial banking assets and liabilities.

Consequently, the confirmed existence of financial institutions rests delicately on the maintains of public confidence. This calls for the establishment of an effective system of internal control which among other things will help to ensure that the laid down procedures standard and statuary requirement.

To establish a sound internal control system various organization adopt scope of their operations. Internal control system requires a continues check and rechecking of day-to-day activities of the business in order to ensure the correctness and firmness of the accounting records, and to detect and expose any deviation when it has accord. Most financial institutions loose confidence of the people not only through fraudulent use of funds but also through some detect infraudulent practices and or syndication of some dishonest staff facilitated by defects in the Bank internal control system. There is therefore a great need to climate or minimize the defects loopholes and make money effective and operational to quard against the occurrence and re-occurrence of fraud in our financial Read More..