FORENSICAUDITING AND FRAUD DETECTION IN THE NIGERIAN DEPOSIT MONEY BANKS

ABSTRACT: The inability to minimize financial fraud by the main corporate governance system and the increasingly advanced financial fraud have posed a significant danger to taxpayers, the government the public sector as well as financial institutions. In spite of the various steps taken to minimize fraud in the financial institution, there are still growing levels of fraud in financial institutions. This paper therefore examined whether forensic auditing helps in the detection and prevention of fraud in deposit money banks using branches in Ibadan metropolis. A total of 120 respondents were selected from six banks using purposive sampling techniques. The study employed survey method and the collection of data was through questionnaire. Regression analysis, Analysis of Variance and Pearson moment correlation techniques were employed. Findings revealed that Knowledge of procedures, Forensic accounting skills, legal background and knowledge of forensic accounting helps in the prevention of fraud and statistically significant with (β = -.758, <0.01), (β = -.766, <0.01), (β = – 0.697, <0.01) and (β = -.729, <0.01) respectively. The study recommends that for the effective performance of the financial sector there is need for forensic audit in the deposit money banks. Furthermore, the banks must improve the implementation of advanced forensic auditing to tackle fraud and forgery in the system as the probability of fraud detection and prevention is still generally low in both the public sectors and financial institutions in the developing countries especially in this era of technological revolution.
KEY WORDS: Forensic audit, fraud prevention, deposit money banks