The Role of Internal Audit in Prevention of Fraud in Nigeria Banks . a Case Study of Equitorial Bank Lagos.

Over the news and media is where it is more commonly heard about fraud in markets such as banking and retail, but not a lot is

(TCO 5) Fraud is an intentional misrepresentation of facts, made for the purpose of persuading another party to act in a way that causes injury or damage to that party. In our readings and discussions we have seen several examples of fraud in business. Using that experience (1) provide an example of a common fraudulent practice in business with an explanation of how the practice works and (2) name and describe each of the elements of the Fraud Triangle.

Fraud is an issue that causes major scandals, although it is a very ancient scheme. Recent fraud events gave light to gaps that facilitated its events. Its extent was drastic by affecting financial markets that eventually trickled into global markets. Major organizations and countries worked cohesively and continue to address the gaps and, in effect, implemented strict compliance regulations to diminish and refrain fraudulent activities. Strict compliance regulations are examples of a fraud response plan the small family business could have implemented to refrain the perpetrators from fraudulent incidents, protect organizational assets and the organization’s going concern.

A study conducted by the Association of Certified Fraud Examiners (ACFE) surveyed 959 cases of reported occupational fraud between 2006 and 2008. The report broke fraud into three categories: fraudulent statements, asset misappropriation, and corruption. Ninety-nine of the 959 cases reported financial statement fraud with a median loss of two million dollars, making it the most costly of the fraud categories. In general, the study found that publicly traded companies that had implemented SOX controls reported fewer losses (70 to 96 percent) than those who had not implemented SOX controls. These results imply that implementation of SOX controls are directly related to a reduction in theft and other fraudulent behaviors. Surprisingly, it was noticed that in companies where management must certify the financial statements, fraud took approximately three months longer to detect than in those companies where management was not required to certify the financial statements. However, due to the complexity and relative newness of SOX and the complexity of the businesses and the ingenuity of people, it is not surprising that SOX has not been a booming success. Hopefully, over time, all the wrinkles will be ironed out allowing for deterrence or immediate detection to be attainable. (Rappeport,

Saiz, Thomas J. "FRAUD IS A MAJOR SECURITY ISSUE FOR BUSINESSES." San Diego Business Journal, vol. 20, no. 15, 12 Apr. 1999, p. 19. Learning Resource Center, t7lrcproxy.iccms.edu:2129/sbrc/detail/detail?vid=0&sid=9b7a4376-1cc6-48ea-8008-4ece1e694af8%40sessionmgr4008&bdata=JnNpdGU9c2JyYy1saXZl##AN=1805123&db=b9h.

The general purpose of this research is to determine the cause for financial statement fraud. In addition, the purpose is to review ways fraudulent behavior can be detected and prevented. Lastly,

Fraudulent, erroneous, and illegal acts committed by a public company, usually at a managerial or executive level, have been a very serious problem for many years and have prompted development of strict and updated regulations, such as the Sarbanes-Oxley Act, in an attempt to prevent these occurrences. Unfortunately, these new or updated regulations are not enough to prevent these acts from happening, thus not alleviating the auditors of their responsibility to detect fraud. Some methods that management and auditors can employ to prevent and detect fraud, errors, and illegal acts are: improving knowledge, improving skills,

It is important to first gain an understanding of the various types of fraud, in order to aid understanding in regards to the prevention of fraudulent activity. This paper begins with a review of the definition of financial fraud, and identification of the different fraud types. Further, included is an examination of what motivates individuals to commit fraud, including an identification of some of the method in which people commit fraud. A discussion of the importance of the fraud triangle, and how rationalization contributes to fraud is a key area of focus. Finally, there is an examination of some controls that prevent and detect fraudulent behavior, including the value and importance of understanding the nature of fraud for

The law of fraud is stretched across the justice and regulatory systems. It covers many different scenarios and grants numerous agencies powers to investigate diverse types of conduct varying in seriousness, from false accounting or fraudulent trading, to sophisticated commercial crime cases involving vast amounts of funds across multiple jurisdictions.

card fraud. In reference to money Laundering we will the complex process of how criminals

According to the internal inspection report of the Societe Generale, certain control was absented throughout a period of time. This absent of certain control indicated that a fraud is occurred and alerted the company about it. However, even though Societe Generale is able to identify the problem, the compliance inspector of the company only conducted a routine reviews and did not have a deep detail checking on issues. Besides, the compliance inspector did not asking for any additional information from Kerviel and simply accepted Kerviel’s claims without putting any effort to validate it. Due to this, its shows that the compliance inspector of the bank is failed to identify the cause of the problems occurred which caused by the lack of

A business can not work out without an account system, which includes internal. Internal controls are used by companies to make sure financial information is accurate and valid. Strong internal controls are signs of a financially healthy company and protect the company’s integrity. Strong internal controls can also increase a company’s profitability. There are several types of internal controls that companies used to protect themselves such as: Segregation of duties, asset purchases, supervisor review, internal audits and adequate documents and records. This paper will discuss several topics from a case study about And the Fraud

143). Nearly all individuals and organizations are subject to pressure and rationalization of actions, the risk of fraud is great if internal controls are non-existent or can be overridden. It is vital to look-out for indicators that signal weakness in internal control environment. Opportunities exist for fraud due to role of process owners in the structure of internal control and the ability to avoid or override the existing controls (Golden, Skalak & Clayton, 2006 p. 134). Lack of sound corporate governance functions such as inadequacy in the extent and effectiveness of supervision by independent functions are al signals of fraud as it’s a demonstration of weak control environment. The control environment includes the continuity and effectiveness of internal audit, information technology, and accounting personnel as well as the effectiveness of accounting and reporting systems (Golden, Skalak & Clayton, 2006 p. 134). When such deficiencies are not managed or disciplinary actions put in place to check such weaknesses or override of controls, it may signal potential red

INTERNAL CONTROL AND FRAUD DETECTION IN THE BANKING INDUSTRY (A CASE STUDY OF GUARANTEE TRUST BANK PLC)

The role of internal audit is to provide independent declaration that an organization’s threatadministration, governance and internal control processes are functioning effectively. Internal auditors deal with concerns that are essentially important to the existence and success of any organization. Unlike external auditors, they aspect beyond financial possibilities and statements to reflect wider problems such as the organization’s reputation, development, its power on the location and the approach it treats its organizations.In summary, internal accountantssupport organizations to thrive.