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The primary goal of this research is to find out the impact auditing on corporate stakeholders. This research work examined the importance ofauditors to the stakeholders of an organizationThe researcher carried out investigations on the role of auditors in corporate performance. To make suggestion on how auditing is inevitable in accomplishing a sound check on financial records of business organizations. These are the areas that the researcher concentrated while carrying out this research work. The first chapter is the introductory part of the research work. This chapter also contains the background of the study, statement of problems, research Question etc. Data for the study was sourced from two main sources which include Primary and Secondary sources of data collection. Primary data: Questionnaires and oral interviews were used to collect information from the respondents. Secondary data : Journals, magazine and other relevant materials relating to the area of my investigation will be review. Extensive literature review was carried out on direct literature and indirect literature on books, journals and past works.       The research instrument  used in this study includes oral interview and questionnaire.  The questionnaire is structural as to contain both close and open ended question. Simple tables, pie-charts and percentages was used in treatment of data while chi-square was used in the research work. Based on the findings, conclusions were drawn and recommendations were also made in the last chapter of this work which is the fifth chapter.


Title page       :      :      :      :      :      :      :      :      :      i

Certification page ..      .      .      .      .      .      .      .      ii

Approval page:      :      :      :      :      :      :      :      :      iii

Dedication      :      :      :      :      :      :      :      :      :      iv

Acknowledgement  :      :      :      :      :      :      :      :      V

Abstract  :      :      :      :      :      :      :      :      :      :      vii

Table of contents:  :      :      :      :      :      :      :      :      viii



1.1      Background of the Study       :      :      :      :      :      :      1

1.2  Statement of the Problem     :      :      :      :      :      7

1.3  objectives of the Study  :      :      :      :      :      :      8

1.4  Research Question  :      :      :      :      :      :      :      9

1.5 Research Hypothesis:      :      :      :      :      :      :      9

1.6   Significance of the Study:     :      :      :      :      :      11

1.7  Scope and Limitation of the Study:      :      :      :      :      12

1.8  Definitions of Terms:     :      :      :      :      :      :      14



Review of Related Literature

2.1   The Role of Audit:  :      :      :      :      :      :      :      16

2.2 responsibilities of organizations and Directors:      :      18

2.3 Types of Audits:      :      :      :      :      :      :      :      19

2.4 Financial Statements of Companies and

Statutory Audit:      :      :      :      :      :      :      :      22

2.5 Assessment of Impacts of Audit Work    :      :      :      30

2.6 Stakeholder Expectations of Audit   :      :      :      :      35

2.7 Agency Model of the Statutory Audit      :      :      :      :      42

2.8   The Limitations of Statutory Audit:      :      :      :      :      44

2.9 The Regulatory Environment:  :      :      :      :      :      46

2.10 Independence Risk Framework:    :      :      :      :      47

2.11How Stakeholders are affected by

Independence risk:       :      :      :      :      :      :      :      50



Research Design and Methodology

3.1 Research Design:     :      :      :      :      :      :      :      56

3.2 Descriptions of Respondents:  :      :      :      :      :      57

3.3 Sources of Data:      :      :      :      :      :      :      :      58

3.4  Populations-and-Sample-Size Determination:      :      :      60

3.5 Methods of Investigation::      :      :      :      :      :      64



Presentation and interpretation of data

4.1Presentation and Analysis of Result::      :      :      :      67

4.2  Hypothesis Testing:       :      :      :      :      :      :      :      79


Summary of Findings, Conclusions and Recommendations

5.1      Summary of Findings:    :      :      :      :      :      :      93

5.2      Conclusions:   :      :      :      :      :      :      :      :      97

5.3 Recommendations:  :      :      :      :      :      :      :      98






The practice of auditing commenced on the day that an individual assumed stewardship over another one’s property.  Stewardship is a name given to the practice by which productive resources owned by one person or group are managed by another person or group of persons.  In reporting on his stewardship, accuracy, efficiency and reliability of that information would have been subjected to some sort of critical review.  Evidence has shown that many years ago, Egyptians, Greeks, Romans and others utilized their opportunities of using check and counter check on the accounting of public funds in order to maintain efficient and effective accounting of public funds committed to them.

Historically, the Auditor had the accounts read to him since the word audit originated from the Latin ‘audire’ meaning the hear.

The original skill required by the Auditor is that which would enable him to carry out an exhaustive examination of the documents and the books which is from the financial transactions of the business especially with the intention of ensuring that all are in order and that no fraud was committed by the employees.

The main objective is to ensure that he account reveal a true ad fair view of the business and its transactions so that all the activities in the organization will be moving smoothly without any obstacle.

Therefore, since the above mentioned countries were successful on the method they used, this economy has to borrow a leaf from them or even find a better way of accounting for public funds since this is the only way the performance of the organizations will enhance.

The researcher wants to know the impact of audit rituals on corporate stakeholders and how its  helps to improve the performances of the companies.  The effectiveness of an independent is not however limited to statement of credibility derived directly from audit itself.  There is a side effect of the prospective audit on employees who might be tempted to defraud their employers and also on the side of management that might find it expedient to endeavour to deceive third party by preparing a misleading financial statement.

The problem is that the funds and properties of the organizations are entrusted to certain individuals in the organization and in most cases. those individuals are not brought under thorough surveillance.  The result is that much funds and properties are diverted to personal.

Another problems is that there is still increase in fraud, mismanagement and lack of trust despite the fact that the financial statements of these organization are suited.

This means that if adequate care is not taking, the rate will continue to be increasing until the organizations fold up.

Also on the side of Auditor, some of the difficulties he encounter during his work will make him not to carry his work as and when due.  Sometimes, it may be lack of knowledge, time and other constraints that Linder him form effective and efficient exercising of his duty.

Managers also contributes to the problems of organization since their problem is for their own welfare and not for the business.

Company performance is very important if such a company

want to achieve its purpose of starting its business without positive impact of any organization, it means that the way of achieving the objectives when the business has commenced will be a difficult situation for that organization.  It is obvious that the performances of companies are not unto expectation.  That is why the researcher wants to know the impact audit rituals on corporate stakeholders.

Since companies have been encountering some problems like fraud, misappropriation of funds and properties, lack of effective management and others that made people to ask if audit rituals plays any significant role towards ensuring efficiency and judicious use of funds set aside by the stakeholders for various purposes.

Some activities and programmes organized by people as re- assumed to be done on behalf of the people.  They are deserved to be assured that the resources which they put at the disposal of these programmes are effectively, efficiently and economically managed since it is known that not all are judicious in public affairs entrusted to them.

Therefore, for proper and efficient accountability, it is obvious that auditors will manifest their principles and activities to be able to arrive at what is expected of them by the stakeholders in order to be convinced that the financial position of the organization as presented show a clear and fair view of the organization.

Consequently, because of biased nature of the organization as a result of poor investigation of the organization position, past rulers have pledged to introduce a more responsible system of government with accountability but their subsequent conduct has shown that they have little or no understanding definition and application of efficiency in the improvement of companies performances.

Auditing which is regarded as one of the recently established professions turn out of the complexity of modern business world.  It becomes relevant so as to discourage people from erring and to expose those that gave wrong account of how they managed the funds and properties under their custody.  The account or report is usually done by means of financial statement.  In order to verify the true and fair view of this report an independent person is needed to audit the account.

The question that is normally asked is in spite of all those provisions and safeguards why is it that one still experience the alarming rate of fraud and misappropriation of public funds and properties by those they are entrusted to safeguard.  That is why a great emphasis has to be laid on proper auditing to improve companies performances in public sectors.


The financial statement of government and other non- business and public sector entities may report on the audit of public sector entities or other public corporation the auditor has to take into consideration the specific requirements  and other relevant regulation ordinances and decrees which affect the audit mandate and any special auditing requirement including the need to have regard to issued of natural security.

According to Onuegbu H.D (1991). Such requirement may affect the scope objective and planning of the audit and the extent of the auditors discretion in establishing materiality and in reporting fraud and the form of the audit report. Fred M.G (1990) states that the extent to which reliance can be placed on the work of the auditor and the auditors objective in respect of other information included in the annual report.


The primary goal of this research is to find out the impact auditing on corporate stakeholders.

i)     To know the importance of auditors to the stakeholders of an organization.

ii)    To carry out investigations  on the role of auditors in corporate performance.

iii) To make suggestion on how auditing is inevitable in accomplishing a sound check on financial records of business organizations.


1.  What are the impact of au


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