ABSTRACT
This research examined the Effect of Internal Audit on Managerial Performance in Public Enterprise. Survey design was employed with the use of a well structured questionnaire. Respondents were selected based on simple random sampling technique. Seventy (70) staff were selected from NNPC. Two hypotheses were formulated and data collected were tested with the use of Chi-Square analysis. Findings from the result shows that Internal audit has significant impact on the reduction of embezzlement in public enterprises and established control has significant effect on managerial performance. The study recommends that internal auditor should continue to efficiently review various departmental functions with a view to enhancing effective accounting system and control.
CHAPTER ONE
BACKGROUND OF THE STUDY
1.0 INTRODUCTION
The term audit is derived from the latin verb “Audire” which means “to hear”. The origin of audit dates from ancient times when the landowners allowed tenant farmers to work on their land whilst landowners themselves did not become involved in the business of farming. The landlords relied upon an overseer who listened to the accounts of stewardship given by the tenants this period the word audit is described as:
The ,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.
Furthermore, the introduction of the joint stock company increased the supply of capital for industry and commerce. The small privately owned business, which was financed by a sole trader or a partnership gave way to the form of organization now familiar as the limited company. The body of shareholders delegated some of their members to act as a board of directors, and periodically the board submitted accounts to the shareholders so that they could be aware of the state of affair of the enterprise in which they had an interest. It was therefore necessary for the shareholders to satisfied the accounts presented of the directors did provide an objective view of the state of affairs of the company.
The joint stock company Act of 1844 .was the fist legislation in Britain fore quire all incorporated businesses to hand their annual financial statements examined by an auditor. Early auditors were, in many cases non accountants who were required state whether the accounts showed a `true and correct’ view of state of affairs of the, it was the company’s Act 1900 that required auditor to be independent and it was not until the 1948 Companied Act that he was required to be professionally qualified. At this juncture, it was more appropriate to define audit as:
An exercise whose objective is to enable auditors to express an opinion whether the financial statement give a true and fair view (or equivalent) of the entity’s affairs at the period end and of its profit and loss (or income and expenditure) for the period then ended and have been properly prepared in accordance with the applicable reporting framework (for example relevant legislation and applicable accounting standards) or where statutory or other specific requirement prescribed the term, whether the financial statements “present fairly”.
WHAT IS INTERNAL AUDIT
Internal audit are those audit that are being carried out by employees within an enterprise. Internal audit is an independent appraisal functions established by the management of an organization for the review of the internal control system as a service’, to the organization. It objectively examines, evaluates and reports on the adequacy of internal control as a contribution to the proper economic efficiency and effective use of resource.
The institute of internal Auditors (IIA), the professional body of internal auditors, define the function in the following way. “Internal auditing is an impendent appraisal activity within the organization, for the review of operations as a service to management. It is a management control which functions by measuring and evaluating the effectiveness of the controls”.
The scope of the internal audit within an organization is broad and may involve topic such as the efficacy of operations, there liability of financial reporting and investigating fraud, safeguarding assets compliance with laws and regulations.
INTERNAL AUDIT AND THE PREVENTION OF FRAUD
By definition, internal control is an independent appraisal function within an organization, carried out by employees of the organization, for the review of operations (financial and otherwise): as a service to management. It is a management controls which functions, by measuring and evaluating the effectiveness of other controls. Fraud or irregularities, which arise in the conduct of the affairs of a company, may be classified broadly into:
Defalcations involving the misappropriate of money or goods, such acts may be performed by an individual or group of individuals without the knowledge of the board of directors, or sometimes, by the board with the intention of defrauding the member.
Fraudulent manipulation of , financial statements not involving defalcation. The main reasons for this are:
To attempt to improve the apparent position or the company e.g to justify a dividend that would not otherwise have been payable or to assist in raising new finance: or To attempt to defraud the tax authorities by reducing taxable profits.
The internal auditors should continuously review the existing controls to ensure that they are followed and update them when need be. This shall ensure that the occurrence of fraud is prevented and that when any such ‘frauds occur, they are easily and timely identified and reported to management. It is his duty to search for fraud, to examine the books, accounts and control/processes/system with the objective of discovering whether there have been defalcations or other irregularities by directors or employees of the company. However, if the directors of the company decide to defraud the members, there is not much the internal auditor can do. Being a staff of the organization, he probable reports to the directors and depends on the board for his remunerations, promotion and other employment incentives.
Similarly, where the management .of business wish to manipulate the a misleading impression without actually diverting any of the business assets, the internal auditors cannot do much as management misstate the assets or liabilities. While the more common target for manipulations is stock, other areas are also susceptible.
financial statements to give It is painful to observe that in practice, members in the employment of companies as accountants, finance controller, internal auditors etc are used to, enhance and perpetuate these management/ directors aided fraud. Members must always beings to bear on all activities they are carrying out for clients and employees the institute’s codes of professional conduct and ethics.
Misappropriation of cash may result from the making of fictitious payments or the diversion of cash receivable. The number of ways in which these may be done depend on the systems of control in existence and the ingenuity of the person or persons involved. In many cases, it is the attempt to cover of rather than the original theft that is detected. So prevention of fraud is continuous review of controls and operations. The opportunities for fraud will depend on the system of controls. Particularly, important are those leading to segregation of duties. Although frauds involving collusion are not uncommon, it is generally agreed that the chance of detection rises with the number of people involved.
1.1 STATEMENT OF PROBLEM
Despite the fact that there are installed control and check of resources, embezzlement and fraud of resources misappropriate of funds, errors, irregularities and mistake stills find their ways into the public enterprises.
Internal audit department was established to reduce those excesses however, in Nigeria public enterprises this is not so, as there are series of problem which has been hindered in the internal audit efficiency.
1.2 PURPOSE OF THE STUDY
The broad objective of this is to examine the effect of internal audit on managerial performances in public enterprise (NNPC). However, some of the specific objectives are as follows:
· To identify the factors that hinder audit efficiency in NNPC as a public enterprise.
· Reduce excesses of the internal auditing department of NNPC Identifying problems and accountability in NNPC.
· Examine the factors that hinder internal audit efficiency and how these factors are impinged. It is also shapes up performance of management
1.3 SIGNIFICANCE OF THE STUDY
The role of internal audit department is called upon to play especially in public enterprise and the ignorance of the employees makes this study important With sound internal audit, management that is characterized by fraud, errors, irregularities, and mistakes in the public enterprises which has resulted by the notion that government business are not supposed to make profit is bound to be eliminated.
The management, employers, employees as well as student benefit from this study.
1.4 RELEVANT RESEARCH QUESTIONS
Below are some questions that would be answered during the course of this research works.
· What is the impact of internal audit on the performance in public sector
· Does establish control failed to enhance management performance in Nigeria public enterprise (NNPC)
· Is there any factors that determine the performance of the management in NNPC
· Does effective internal audit enhance reduction of fraud?
· Is there any factor that prevent; internal audit from being effective and efficient in NNPC.
1.5 STATEMENT OF THE HYPOTHESIS
To ensure a mere analytical result oriented research, hypothesis are formulated and tested on the research objectives.
The decision criteria are to accept the null hypothesis (HO) and reject the alternative hypothesis (Hi) or otherwise based on the result of the test performed. The research hypotheses are stated below:
Hypothesis 1
HO: Internal audit has no significant impact on the reduction of embezzlement in public enterprises
Hi: Internal audit has significant’ impact on the reduction embezzlement in public enterprises
Hypothesis 2
HO: Established control has no significant effect on managerial performance.
Hi: Established control has significant effect on managerial performance.
1.6 DELIMITATION OF THE STUDY
The scope of limited to various measurement of internal audit which are used in public enterprises. The constraints to this study are time, in adequate information, lack of enough literature on this subject arid information which are considered confidential were not revealed by some of the staff.
ABSTRACT
Parent’s status has a problem which has faced the academic performance of the students as a matter of facts this study focused on the effect of socio-economic background of student on their performance in secondary school certificate examination economics.
Hence the effects of socio-economic background on student performance were strictly analyzed by and large the result of the study indicated that socio-economic background has effect or academic performance of the learner.
CHAPTER ONE
Introduction
1.1Background To The Study
Over the last decades, multiple attempts have been made to estimate an education production functions, linking various socioeconomic factors to an indicator of students’ performance.
This empirical literature, however, had led to ambiguous results. In particular. No mechanical relationship between the amount of resources fed the educational system and pupils performance has been identified (e.g. Coleman, 1966); Hanushak, 2003; Woessmann, 2000). In this context, some authors suggested paying more attention to the organizational aspects of the schooling process and in particular to the specific incentive structures which prevail within schools (Hanushak, 1997, Bishop et al 2000).
In recent years policymakers at the federal, state and local levels have worked to increase accountability in our education system by measuring student’s performance and raising standards. These joint efforts have equipped policymakers, educators and parents with the tools needed to grade not only students but also their schools. With the groundwork set, it is curricle that parents take advantages of opportunities for involvement in their children learning experience and play an active role in ensuring education excellence. During the last two decades, higher education institutions have invested heavily in information and communication technologies (ICT) ICT has had a major impact in the university context, in organization and teaching and learning method.
One puzzling question is the effective impact of these technologies on student’s achievement and on the returns of education.
Many academics researchers have tried to answer this question at the theoretical and empirical levels. They have faced two main difficulties, on one and student’s performance is hard to observe and on the other, ICT is involving technologies and there effects are difficult to isolate from their environment.
There is no standard definition for student performance the approach focus on achievement and curricula, how students understand courses and obtain their degrees or their makes. However, a move extensive definition deals with competencies, skills and attitudes learned through the education experience the narrow definition allows the observation of the outcomes of any change in higher education, while the more extensive definition needs a more complex strategy of observation and a focus on labour market the outcomes of education are mainly validated in the labour market.
The relationship between the use of ICT and student performance in higher education is not clear, and there are contradictory results in the literature. Earlier, economic research has failed to provide a clear consensus concerning the affection student’s achievement.
Institutional and organization variables also have consistent effect more precisely, schools autonomy in the recruitment of teachers has a strong positive influence on students’ performance.
We used the program for international students’ assessment (PISA 2000).
Cross section data to estimate the impact of organizational and institutional factors on students’ performance (controlling for individual characteristics).
In other to take into account hierarchical nature of the data, we introduced a country fixed-effect and school random effect in our regression model of education production function.
1.2Statement Of The Problem
Over the years, there have been many researches to investigate the effect of socioeconomic background of students on their academic performance
Researches have been conducted to find out.
i. How does the socio-economic background affect the academic performance of the learners?
ii. Do the teachers’ characteristics have effect on student’s performance?
iii. Does the students socio-economic characteristics affect their education performance?
iv. Does the educational environment have impact on students’ performance?
v. What are the impacts of ICT on student performance in higher education: Direct effects indirect effects and organization change?
Also the researches work originated as a result of late coming to school; not performing well in their class-work and the effect on indiscipline of the student with special reference to Awori College Ojo.
1.3 Purpose Of The Study
The purpose of the study is summarized as follows
i. To find out how the economic of the parent affect the academic of the student.
ii. To find out the economic of the parent affect the academic of the student.
iii. To find out why students are been affected by their socio-economic background on their academic performance.
iv. To find out some other factors that affect student’s academic performance.
v. To find out the relationship been the use of Information and Communication Technology (ICT) and student performance in higher education.
1.4Research Hypotheses
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