ABSTRACT
This research work has
investigated “ the internal audit as a tool for management control” (A case
study of project development institute PRODA)which is located in Enugu East
Local Government area in Enugu State.
The major objective of this
project or research was to find out those objectives that made the internal
audit as a tool for management control at PRODA in Enugu .
To accomplish the above
objective therefore, the work has to be divided the following conclusion have
drawn from the major finding of the
study.
There is a misconception of
the internal audit function by non-auditing personnel.
This state of affairs, from
information is due to ignorance or attempt to cover up fraud are errors.
The existences of standard
internal audit produce promotes efficient internal audit.
The internal audit provides
an economical a measure for safeguarding company funds and property.
The objective of internal audit is to aid in
management control of government enterprise. The internal auditor therefore,
aids efficient control of organization activities.
Other findings includes:
I.
Internal
auditor issues periodic report the management for conservation and
decision-making. The internal audit have helped to:
II.
Minimize
fraud and extravagant use of frauds.
III. Ensuring that all money due
to the institute are collected and properly recorded
TABLE OF
CONSTANTS
Title page
Approval page
Dedication
Acknowledgement
Abstract
Table of
contents
List of tables
CHAPTER ONE
INTRODUCTION
1.
Background
of the Study
2.
Statement
of the Study
3.
The
Purpose of the Study
4.
The
Scope of the Study
5.
Research
Questions
6.
Significant
of the Study
CHAPTER TWO
2.
REVIEW
OF RELATED LITERATURE
CHAPTER THREE
3.
Research
methodology
1.
Research
Design
2.
Area
Of Study
3.
Population
of the study
4.
Sample
and sampling procedure
5.
Instrument
for data collection
6.
Validity
of the instrument
7.
Reliability
of the instrument
8.
Method
of data collection
9.
Method
of data analysis
CHAPTER FOUR
13. Data presentation and
analysis of results
4.1 Summary of results.
CHAPTER FIVE
14. Discussion of results
5.1 Discussion of findings
1.
Implication
of research findings
2.
Recommendations
3.
Suggestive
for further researcher
4.
Limitation
of the study
References
Appendices
LIST OF TABLE
Situation of internal audit
in the organization.
Qualification of internal
audit staff
Has the internal access to
all records and information needed for their work?
Does the function of the
internal audit include review of financial accounts prepared by the accounts
department?
Does the internal audit help
in the preparation of the accounts.
Does non-auditing officers
constitute problem by created opportunities to influence internal auditor work.
Is internal audit of
government enterprise only concerned with accounting matters?
Does internal audit of
government enterprise have standard, auditing procedure and guide line.
The standard of auditing
procedures used by internal audit of government enterprise is a function of.
Is it possible for payment
to be made with out the review and approval of the internal audit department?
Internal audit functions
appraise the work of others.
Does the management
recognize the control input of this internal audit department?
Have the inter audit help
the management to attain their goal.
Internal auditor government
enterprise are not independent.
Has the internal audit
process any impact on fraud and misapplication of enterprises funds and
property.
What in your opinion will
help improve the efficiency of internal audit department of government
enterprises.
How the internal department
contributed to management control.
Does the internal audit
issue reports to the management.
Are internal audit reports
and recommendations adequately considered and used by management?
What are the implications of
management not responding to weakness highlighted by internal audit reports?
How do internal auditors of
government enterprise perform their work?
CHAPTER ONE
1.
INTRODUCTION
1.
BACKGROUND OF THE STUDY
Annual budgets by the
federal state and local government are generally incorporated into government
accounting system and financial reports.
These budget estimates are
central to the process of making and executing public sectors polices among
which is the proper allocation of available resources and reduction in
inequality of incomes of individuals. In order to achieve these public sector
policies goals mentioned above, there is the need for an internal audit
operations within our ministries. The growing recognition by management of the
benefits of a good internal control and the complexities in a large
organization led to the development of internal auditing as an important
component of the internal control system. The emergency of the internal auditor
as a specialist in internal control is the result of an evolutionary process
that is similar in some ways to the evolution of the independent audit (Howard
1976). The principal factor in its emergency was the extended span of control
faced by management as concerns employing thousands of people and conducting
operation from widespread locations. Defalcations and improperly maintained.
Accounting records were obvious problem under these circumstances. The growth in the volume of
transactions meant a substantial bill for public accounting service for the
business that endeavored to solve the problem by containing the traditional
form of audit by public accountants.
This solution according to
Howard (1976) was to provide the needed auditing services on an internal basic
particularly as the genitures of the problem made it possible their one or more
persons to specializes in such auditing services and devote their full time to
the needs of the enterprise. Other advantage that resulted from this internal
approach to the problem was that the internal auditor tended to be problems of
the company and the auditing activity could be carried on costively, rather
than, once year when outside auditing of government ministries departments and
extra ministerial department entrusted with public resources and the authority
for applying them have a responsibly to render a full accounting of their
activities. This accountability is inherent in the management process and which
the public resources have been devoted nut also the manner and effort on their
application.
Auditing
is an important part of the accounting process since it provides independent
judgment of the credibility of public official’s statements about the manner in
which they have carried out the responsibilities. The auditing function assures
the objectivity of and adds credibility of fair presentation of performance
information (Edwards and Black 1976). There has been an unprecedented increase
in the importance of internal auditing due to the importance of internal
auditing due to the widespread recognition of the invaluable role performed by
this branch of auditing profession. Many government enterprises have therefore
found reason to maintain an internal audit department as a necessary component
of their internal control system. Owing to the priceless valve from internal
audit of the institute of character accountants of England and Wales (ICAEXW)
defined it as “ a review of operations and records, sometimes continuous
undertaken within a business by specially assigned staff. It encompasses such
examinations conducted on the affair of the organization as a tool of
management control.
Miuichamp (1987) described
internal audit as an independent appraisal function within an organization for
the review of system of control and the quantity or performance as a service to
the organization. It objective examines, evaluates and reports on the adequacy
of internal control as a contribution to the proper economic, efficient and
effective use of resources a substantial part of the internal audit function
performance some people working as employees of the organization.
The common ar4eas of
internal auditing act thought its history have been examining, ifying and
reporting. Internal auditing has thus been employed as a key factor in
controlling every kind of organization with financial and economic records.
According to the American
national Association of collage and University Business officers, the development
of internal audit as a major element of management control resulted from the
need of manager for information relation to all significant aspects of
institutional operations. Effective management control cannot be maintained
without an efficient system to provide for a prompt reporting of essential
information from all parts of the organization. The control idea of management
control through the use of accounting is the essential to the efficient conduct
and evaluation of the operating activities of the organization.
Accordingly, the inclusion
within the accounting made of potential bits of information conditions the
management and the decision made (Pawell, 1994).
The conventional internal
auditing model and the performance signals that it produces have come to impact
upon management efforts to accomplish its objective (Edwards and Black, 1976).
The growth in business management has also assisted in the development of
internal audit as a useful ad to management of government enterprise.
Internal auditing is an
element of managerial control and is responsible for measuring the
effectiveness of such controls. The scientific equipment development institute
(SEDI) is a research institute under the federal ministry of science and
Technology. The institute has cover the years carried out research on
industrial materials and process including engineering designs, development and
falsification; it has to its credit so many plastics, ceramics, glass wares
(Beakers, measuring cylinder, pipette etc.) industrial and engineering products
for household and industrial application.
The management of SEDI is
aware of the role of an efficient internal audit towards achieving organization
goals and have therefore established and internal audit department.
1.2 STATEMENT OF PROBLEM
The problem are summed up as
follows:
1.
The
management of government enterprise do not fully appreciate the operational
equipment of internal audits as a sources of management information system.
2.
There has been observable failure by
management to serve economic efficiency and effectiveness in the use of
resources at their disposal.
3.
How can government enterprise funds and
property be managed to ensure their soft
4.
The
mis-conception of the internal audit function among employees and management
diminishes it roles.
1.3 THE PURPOSE OF STUDY
1.
To
evaluate the internal audit function ascertains how it can enhance management
control.
2.
To
appraise the role of the internal auditor in the accountability process of the
management of government enterprises.
3.
To
ascertain the produces and methods of internal auditing in government
enterprises and evaluate its effectiveness in the realization of management
objectives.
4.
To
find out the problems that hinders effective internal audit and seeks ways of
solving such problems.
1.4 RESEARCH QUESTIONS
1.
Are
there statement internal audit procedures and guidelines for the audit of
government enterprise?
2.
Are
the audit control measures adequate and reliable to ensure the safety asset,
completeness and accuracy of the financial records?
3.
How
can faithful working relationship be created among the internal audit staff and
other workers?
4.
How
can internal audit reports assists in management control?
1.
THE SCOPE THE STUDY
The scope of this study
mainly focuses on the system of internal control accounting system and internal
audit procedures in government enterprises with corporate polices and produces.
An effective internal audit serve can in particular, help reduce overhead,
identify ways to improve efficiency and minimize exposure to possible losses
from inadequately safe guarded company assets. For the above objective to be
accomplished, the internal audit department must perform certain functions,
which must be in with the requirements of the organizational internal control
system a quality internal audit service will therefore makes a positive
contribution to the objectives of any organization.
This study is significant in
many respects in the management of private the awareness reprises of the
immense benefits of an efficient internal audit department. It is significant
in many respects and it is intended to create the awareness in the management
of private and public enterprise of the immense benefits of an efficient internal
audit department. It is hoped that management will see that internal audit
function as that which has much to offer the organization as a whole, in terms
of ensuring that the operations of the organization are well controlled and the
systems used are efficient, resources are utilized economically and the
information provided to management is reliable.
To the internal auditors who
are expected to excellent communications, it will be beneficial to know the
owners responsibities placed on them as watch dog of their organization. Other
who would benefit from this study are future researcher and Fellow students. It
will improve to a great extent their theoretical and practical Rowedge about
the role of an efficient internal audit department in the management control of
government enterprise. It acts as referral to students.