Forensic Accounting and Fraud Management
Forensic Accounting and Fraud Management
Forensic Accounting and Fraud Management
ABSTRACT
reverse will be the case when the crimes are punished by arrest
or shunned. Thus, this study aims to determine the role forensic
accounting will play in ensuring crimes are punished in order to
reduce its occurrences.
2.2. Related Literatures
2.2.1. Nature of fraud
The concept of fraud in itself disordered. But scholars vary
significantly in their expressions about fraud. The cause is
sometimes confused with effect. Defining fraud is as difficult as
identifying it. Fraud is defined by EFCC : as . . . the
non-violent criminal and illicit activity committed with
objective of earning wealth illegally either individually or in a
group or organized manner thereby violating existing
legislation governing the economic activities of government and
its administration . . . Nwaze (2012) defined fraud as a
predetermined as well as planned tricky process or device
usually undertaken by a person or group of persons with the
sole aim of cheating another person or organisation to gain ill-
gotten advantage which would not have accrued in the absence
of such deceptive procedure.
(Onuorah and Appah, 2012) as cited in Bello (2001) and
quoting Russel (1978) remarks that the term fraud is generic
and is used in various ways. Okafor (2004) added that fraud
embraces all the multifarious means which human ingenuity
can devise, which are resorted to by an individual to get
advantage over another in false representation. No definite and
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3.0. Methodology
The choice of design in any research depends on the purpose of
the problem and variable alternatives for the problem of that
nature. The survey research design is used in this study. The
population of the study comprises four diverse groups; auditors
(Internal and External), those involved in financial statement
compilation, users, and academics. In considering sample size,
Saunders and Thornhill (2003) suggest that a minimum
number of thirty (30) for statistical analyses provide a useful
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Coefficientsa
Model Unstandardized Standardized T Sig.
Coefficients Coefficients
B Std. Beta
Error
Decision Rule: If the F-value is greater than 5%, accept the null
hypothesis otherwise reject if and accept the alternative.
The R-square of 65% shows that the independent variables can
explain the dependent variable 65.5%. The regression result
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REFERENCES
(a) Strongly Agree (b) Agree (c) Undecided (d) Disagree (e)
Strongly Disagree
7. Forensic accounting is effective in assessing, monitoring and
evaluation of internal control systems
(a) Strongly Agree (b) Agree (c) Undecided (d) Disagree (e)
Strongly Disagree
8. Forensic accounting enhances the quality of financial
reporting
(a) Strongly Agree (b) Agree (c) Undecided (d) Disagree (e)
Strongly Disagree
9. Forensic accounting improves stakeholder trust and
confidence in corporate financial statement (a) Strongly Agree
(b) Agree (c) Undecided (d) Disagree (e) Strongly Disagree
10. Accountants/auditors with forensic accounting skills will
deliver more quality financial reporting. (a) Strongly Agree (b)
Agree (c) Undecided (d) Disagree (e) Strongly Disagree
11. Forensic investigations deals directly with fraud
investigation and this reduces financial reporting expectations
gap a Strongly Agree b Agree c Undecided d Disagree
(e) Strongly Disagree
12. Traditional External Auditors are not influence by
management (a) Strongly Agree (b) Agree (c) Undecided (d)
Disagree (e) Strongly Disagree
S/N SA A U D SD
1 Forensic accounting can be 216 120 50 78 46
used to uncover diverted
fraudulent practices.
2 Forensic accounting can 307 114 9 37 43
Identify misappropriated
assets and identify
reversible insider
transactions
3 Forensic accounting is 221 279 2 6 2
effective as a fraud detection
tool
4 Forensic Accounting is solely 43 37 44 189 197
enough as a tool to prevent
suspicious or fraudulent
transactions
5 Forensic accountants do not 55 35 62 157 201
bear any risk under forensic
accounting practice; it
specifically covers risk of
fraud.
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ABSTRACT
The study assessed the impact of IFRS accounting numbers on
value relevance in quoted companies in Nigeria. The objective
of this study is to determine if the adoption of lFRS has
improved value relevance of quoted companies in Nigeria. The
researchers adopted the use of secondary data by way of
annual reports of the quoted companies in Nigeria. The Taro
Yamani formula was used to derive the sample size from the
population of one hundred and eighty-three quoted companies
on the floor of the Nigerian Stock Exchange from which a
sample size of one hundred and twenty-six companies with
error limit of five percent appropriate for the study was
adopted. We adopted the cross sectional and longitudinal
design and thus compared the pre-IFRS and post IFRS financial
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1.0. INTRODUCTION
Information emanating from financial reporting is
regarded as useful when it faithfully represents the economic
substance of an organization in terms of relevance, reliability,
and comparability (Spiceland, Sepe & Tomassini, 2001). High
quality accounting information is essential for well functioning
capital markets and economy as a whole and as such should be
of importance to investors, companies and accounting standard
setters (Hellstron, 2005). Financial statements still remain the
most important source of externally beneficial information in
companies; it serves as a mirror to the investor. Investors are
not in a position to directly access the performance of the
company in which they are intended to invest, they usually
depend on the financial statements prepared by the
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3.0. METHODOLOGY
The researchers made use of the cross sectional and
longitudinal research designs this entails the comparison of the
pre-IFRS and post-IFRS performance valuation in order to sort
out the existence of casual effects of one or more independent
variables upon a dependent variable of various companies at a
given point of time. This design is best suitable for this study as
a cross section of Nigerian listed companies will be selected for
the analysis over a period of time.
The population of the study consists of all quoted
company on the floor of the Nigerian stock exchange. The
researchers were able to collect complete data for 29
companies for the periods of interest. The variables obtained
includes earnings per share, return on equity, dividend per
share, return on asset from 2008-2013.
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The key variables from the above table are the post-
share price and pre-share price. The result shows that there is a
positive association between both variables implying that, as
the share price of the pre-IFRS increase, the share price of post-
IFRS also increased across the periods. This association i.e.
represented by r =0.8609 i.e. % of the company s share price
in both pre and post increased. Based on this analysis, we
cannot say any of these periods affected the value relevance of
financial statement.
5.1 Conclusion
This research work examines the value relevance of IFRS
financial statement in quoted companies in Nigeria. Value
relevance is seen as a proof of the quality of accounting
numbers and as such it can be interpreted as the usefulness of
accounting data for decision making process of investors. The
study has made an immense contribution to the value relevance
literature by examining the value relevance of IFRS financial
statement in quoted companies in Nigeria. The results
demonstrate that, so far, there has been no impact of IFRS
financial statement in quoted companies in Nigeria. Four
variables were used to ascertain their impact on share price in
quoted companies in Nigeria. Among the four variables, return
on equity is the most significant value relevant variable in the
pre and post IFRS financial statement. Therefore, we conclude
that IFRS has not improved value relevance in the country.
5.2 Recommendation
Following the study s findings, these recommendations
are presented which may be of use to National Standard Setters,
preparers of accounting information and investors;
1. Companies should ensure that existing business
reporting model is amended to suit disclosure and
reporting requirement of IFRS.
2. National accounting standard setters and preparers of
accounting information should make effort toward
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