Internal audit as a tool management control
was intended that through this research that the benefit if using internal
audit for efficient control of activities in institution of higher learning
would be computerized. The aim of the
study is to investigate and ascertain how effectively institution of high
learning administration can employ the services of internal audit to effect
control and thus ensure that attainment of its objectives. In the course of the investigation, the
researcher used secondary data through out. This date was collected form
library, journals etc. It was found that
internal auditors play a very vital role in institution of higher learning. A
well functional internal audit can bring about proper management and ensure
prudent use of resources in the institution of higher learning.
of internal audit
of internal audit
of the study
of study / delimitation
of some terms used
of an internal auditor
Function of an internal audit department
resulting from poor internal
as an aid to management control
and internal auditor compared similarities
of literature reviewCHAPTER THREEFindings,
recommendation, and conclusion
BACKGROUND OF STUDY
Auditing has been defined by the international
auditing practicing committee (IAPC) as an independent examination of and the
expression of an opinion on the financial statement of an enterprise by an
appointed auditor in accordance with relevant statutory obligation and
On the other hand appeared on the business scene
much later than auditing by public accountant. The principal factor in its
emergence was the extended span of control faced by management in concern,
employing thousand of people and conducting operations from widespread
and improperly maintained accounting records were obvious problem under these
circumstances. The growth in the volume of transaction resulted in substantial bills
for business that endeavored to solve the problem by continuing to engaged the
services of public accountants.
was of course
To provide the needed auditing service on an
internal basis, particularly as the magnitude of the problem made it possible
for one or more persons to specialize in such auditing services and devoted
their full time to the need of single company.
advantages also resulted form an internal approach to the problem. Internal
auditors tended to become better acquainted with the procedures and problem of
the company and the auditing activity could be carried on continuously, rather
than once a year when outside auditing services were utilized.
further inducement to the development of internal auditing public accountant
were a the same time facing an increasing demand for independent audit, leaving
to the expression of opinion on financial statement they recognized that they
would perform the older type of fraud detection or verification as effectively
as could the company’s own specialist.
number of institutions have been established by both the states and the federal
government of Nigeria. Their rule derives from the fact that they normally
comprise the largest single collection of highly specialized people.
appreciates the invaluable role they can play in the overall development of the
country through the provision of well rained middle and higher level man power
for various department of government and the private sectors. in view of this,
the huge investment by government should be controlled, safeguard and made
result oriented. The role of internal audit, as the “watchdog” of those
controls established by the institutions becomes the only sure means of
controlling the institutions activities.
DEFINITION OF INTERNAL AUDIT
This conducted by the employee of the organization
into any aspect of its affirms the internal department is often attached to the
office of the chief executive to whom the head of internal audit reports the
internal auditor need.
be a professionally qualified person. By this we mean he need not be a member
of a professional body like the institute of chartered accountant of Nigeria he
may be a university or polytechnic graduate of accounting.
is not to say that a chartered accountant or national accountant cannot be an
internal auditor. The internal auditor has the responsibility to ensure
compliance with the rules and safeguard the liabilities of the institutions.
audit is a managerial control that functions by measuring and evaluating the
effectiveness of other controls. As described by OYASI. It is a review of
operations and records, sometimes continuously undertaken within a business by
specially assigned staff.
the institute of internal auditors (IIA) in its statement of responsibility
defined it as an independent appraisal activity within an organization for the
review of accounting, financial and other operations as a basis of service to
MILLICHAMP (1987) analyzed the components of the
Carried on by
That is not to say independent of the management
which appoints and control item, but independent in forming an unbiased opinion
on the account and records they have examined.
That is to say that their job involves the appraisal
of the organization activities with a review discovering deviation from the
established norms an practices and recommending remedial actions. The appraisal
activity will also reveal any weakness in the system and in such cases, a
review of the system becomes imperative.
In any organization, there is usually a system
internal control. The internal auditor is thus concerned with measuring and
evaluating this control system for continuous effectiveness and efficiency of
other operating control his audit procedure is as following:
Effective work allocation to staff taking into account the experience,
training and compliance
Proper definition of scope of work to be performed by each audit staff
and the objectives of their task.
Use of working paper to provide adequate evidence of work done
Review of work of the audit staff by more experienced staff in the
practices (audit forms)
Consultation with other practitioners provided the client
confidentiality is maintained.
IMPORTANCE OF INTERNAL AUDIT
It acts as a consultant on internal control matters
It review the economy efficiency and effectiveness of operation and of
the functioning of non financial control
The internal auditor performs he work of the documentation and
evaluation of accounting system and internal controls and carry out compliance
and substantive test.
It perform the audit of annual account which is primarily the
responsibility of the external auditors
It is also concerned with the response of the internal control system
to external stimuli. The world does not stand still and the internal control
system must continually change.
It provides the information to management particularly on interim
financial account and management accounts.
It is also concerned with the response if the internal control system
to error and required change to prevent errors.
It acts as a training unit in internal control matters
It is equally concerned with that implementation social responsibility
policies adopted by top management. An example of this is energy selling
STATEMENT OF PROBLEM
Internal auditing as earlier defined is an
independent appraisal activities within an organization for the review of
operation as a service to management. It is also a management control which
functions by measuring and evaluating the effectiveness of other controls.
problem is why institution do not perform well given the importance attached to
these institution by government. The causes of non performance of institution
of higher learning have always been addressed by government setting up
administrative boards of enquiries into their activities. It is patient to note
that the finding and the government while paper on the reports have indicted
the management of the institution for such ugly state of affairs.
finding of such boards of enquires have also contained suggestion on how
institution funds and properties could effectively managed.
conceived however, that if the institution of high learning exercise complete
control over the activities of their staff, an efficient administration can be
study, aims at finding way by which the management of higher institution can
fully utilize the services of internal audit department to achieved
also hoped that from this study, the management of higher institutions can
fully utilized the services of internal audit department to achieve
institutional objectives. It is also hoped that form this study, the management
of institution of higher learning would be better equipped to apply the
internal audit findings and reports to enhance the well fare of the
OBJECTIVE OF THE STUDY
The objective of the study are:
To ascertain the extent of the protection of accounting for, and
safeguarding of company assets against losses of any kind or description.
To ascertain how institution administration could fully utilize the
services of internal audit for control purposes
To investigate how institutions administration can be more efficiently
run in order to create a conducive atmosphere for academic work.
SCOPE OF STUDY /
The study concentrated on the institution of higher
learning in our country, with particular reference to tow institution mentions
above. This limitation is as a result of time constraint and the fact that such
other institution of higher learning scattered over the country cannot be
conveniently covered. Given the distances from one to the other and the
financial involvement in items of transportation cost
DEFINITION OF SOME TERMS
Evaluation of internal control depends on how well
the accounting system provides for:
Evaluation of clerical and accounting efficiency from the stand point
of such matters as effectiveness of procedures used, use of mechanical and
electronic equipment, utilization space, adequacy of personnel and programs
records preservation, and destructions.
Information that is adequate and accurate, protection of resources of
the organization from losses due to
embezzlement, or carelessness and control over all phases of operations.
Independence is essence for the effectiveness of
internal auditing this independence is achieved through organizational status
and objectivity the organizational status of the internal audit unit and the
support accorded to it by management as a major department in terms of function
and relevance. The head of the internal audit department therefore should be
responsible to an officer whose authority is sufficient to ensure both a board
range of audit coverage of function, adequate consideration of, and an
effective disposal action on the audit findings.
This is a process of inspecting a document that
supports a recorded transaction or amount the direction is from the accounting
record to the document. Examples are supporting recorded sales transaction by
inspecting sales invoices and supporting recorded addition to property by
inspecting manufacturers invoices.
It is defined
as the whole system of controls, financial and otherwise established by the
management in order to carry on the business of the enterprise in an orderly manner
and ensure adherence to management policies.