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THE ROLE OF FORENSIC IN BANKING SECTOR

  • Type:Project
  • Chapters:5
  • Pages:67
  • Methodology:empirical analysis
  • Reference:YES
  • Format:Microsoft Word
(Banking and Finance Project Topics & Materials)
THE ROLE OF FORENSIC IN BANKING SECTOR
CHAPTER ONE
INTRODUCTION
1.1 Background of the study
The trend of falsehoods involving all levels of the society is increasing on a daily basis. The rich, the poor, the young and the elderly, the male and the female all are neck deep in fraud and fraud related activities that say a lot about our moral and family situations. From the politicians to the bank directors/executives, from the legal officers to the law enforcement personnel, from the civil servants to the school teacher, from the trader in the market to the hawkers on the street, the tendency for fraud and fraud related crimes is endless.
According to Folger, 2011,  in many quarters, forensic accounting is equated to financial audit but they are miles apart. Forensic accounting is usually described as the integration of accounting and auditing skills with investigative techniques and professional skepticism. Forensic accounting provides an accounting analysis that is suitable to the court which will form the basis for discussion, debate and ultimately dispute resolution (Zysman, 1987). One area of similarity is the provision in the Statement of Auditing  Standard (SAS 1) that requires an auditor to approach his assignment with ‘professional skepticism’ which requires auditors to adopt a questioning mind and a critical assessment of audit evidence in assessing audit risk of fraud (hecht &Redmond, 2012). Forensic Accounting is the objective verification of the primary goal (Ojo, 2012). For this reason, many forensic accountants are asked to testify in court cases as expert witnesses for either the prosecution or the defense. It can be said therefore that forensic accounting is not limited to fraud detection but also assisting in litigations with the hope of recovering any losses; hence a forensic accountant’s assignment must be of such a quality that it can withstand scrutiny by attorneys, judges and  juries. On the other hand a forensic accountant may be asked to calculate economic damages that occurred as a result of a breach of contract or provide insight into a case based on a claim of professional negligence. In Nigeria for instance, businesses are faced with breach of contracts which may be reasons for many abandoned projects, mainly the government sponsored, by contractors who might have collected more than fifty percent of the contract sum. The application of forensic accounting can bring such fake contractors to book by providing appropriate financial evidence that can aid legal actions against them. Also, forensic accounting is considered to be a mechanism for global war against money laundering, terrorism financing, as well as other fraudulent and social vices that have impeded the nation’s march to development (Oguma, 2011)
Fraud and financial crimes are global phenomena. They run across all human race irrespective of their social and economic status. Financial crime includees money laundering, bribery, looting, embezzlement, fraud; tax evasion, foreign exchange malpractice and oil bunkering. Financial crimes are motivated by financial need caused by avarice, gambling, debts, business reversals, poor investments or trying to maintain a lifestyle well beyond one’s means Mukoro,Yamusa & Faboyede, 2013.
The first and most sophisticated way to carry out a financial crime in many companies is through the manipulation of financial records and accounting. It is a recognized fact that the management of Enron the celebrated energy company in United States of America (USA) defrauded by it top management used creative accounting to make the company look good and powerful on paper than it really was using special purpose entity. Management excluded these entities from Enron’s balance sheet to hide these risky investment activities  and financial loses (Mukoro, Yamusa & Faboyede, 2013).
 In Nigeria, corruption, money laundering and mismanagement of resources and other related crimes have assumed alarming proportions and have become rampant both in the public and private sectors of the economy (Balarebe, 2009; Williams, 2010). Forensic accounting is perceived to have evolved to tackle fraud related cases and financial crimes.
According to (Zaden & Ramazani 2012), forensic accounting is a specialized field of accounting which deals with legal claims and complaints. Adegbie and Fakiel (2012) posited that forensic accounting is the practice of utilizing accounting, auditing and investigative skill to assist in legal matter. It is the application of specialized body of knowledge to the analysis of economic transaction and report suitable for the purpose of establishing accountability or valuation for administrative proceedings. (Eiya & Ofalor 2013) described forensic accounting as the integration of an individual accounting and auditing knowledge with investigative skills that have been gained from years of practical experience.
1.2 Statement of the Problem
Financial crimes in banking sector is one of the greatest obstacles to national economic development as the nation has nothing to show for its huge earnings from  Financial sector (Adegbie & Fakile 2012). The effect of financial crime on any organization is usually unpleasant A Kenbor& Oghoghomeh, 2013. Financial crime in any organization leads to economic loss, loss of goodwill, loss of staff and consequently, business closure. Abiodun (2006) posits that the most significant effect of financial crime is the economic loss to the organization. Financial crime also result to loss of valuable employees who are prosecuted, found guilty and terminated of their job or innocent employees who may voluntarily resign their employment due to humiliating experience they had during the fraud investigation (Akenbor & Oghoghomen, 2013).
Few prior studies have tested empirical relationship between forensic accounting and financial crimes (Akenbor & Oghoghomeh, 2013; Okolie, 2014). Since there is alarming rate of financial crimes in Nigeria, this study will use primary data to test empirical relationship between forensic accounting and financial crimes. The following research questions were raised to address the problems:
(i)    Does forensic accounting play a significant role in curbing financial crimes in the Nigerian banking sector?
(ii)     To what extent does forensic accounting deter money laundering?
1.3    Objective of the Study
(i)    To ascertain if forensic accounting plays a significant role in curbing financial crime in the Nigerian banking sector.
(ii)    To find out the extent to which forensic accounting deters money laundry.
1.4 Research Hypothesis
H01: forensic accounting does not play a significant role in curbing financial crimes in the Nigerian banking sector.
H02: forensic accounting does not deter money laundry.
1.5 Scope of the Study
This study examines and attempt to the role of forensic accounting in curbing financial crime in the banking sector in Nigeria in its entire ramification, focusing on Edo State. In the course of this study questionnaires will be administered to investors and top level management as well as other staff of the following five banks in Edo State: Fidelity bank (Sapele road, Benin City), UBA (Ugbowo, Benin City), Stambic IBTC bank (taboga road, Benin City), Access Bank (Sapele road, Benin City), Keyston Bank (Ikpoba hill, Benin City).
1.6 Significance of the Study
This study contributes to the literatures designed to the role of forensic accounting  in curbing financial crime, particularly for the banking sector in Nigeria. It will help to widening our knowledge to know if we should  quantity damages sustained by parties involved in legal disputes and also assist in resolving disputes before they reach the court room.  It will help to determine if criminal matters such as employee theft, securities fraud (including falsification of financial statements), identity theft, or insurance fraud have occurred and if forensic accounting has been of any help to solve such situation. Investigation may also occur in civil matters. It  will also help if forensic accountant should be hired to search for hidden assets in some case.
Finally this research will equally serve as a reference to students who may be interested to embark on further research study of this nature.
1.7 Limitation of the Study
This research work is limited in scope geographically to Edo state, and out of the 22 banks in existence in Nigeria, only 5 banks in Edo State will be administered with questionnaires on the above research topic. This is occasioned by the time frame given for the research and other logistics involve as well as some unwilling respondents.
However, there is an assurance that the data gotten and given are reliable and have helped to achieved the set objective


THE ROLE OF FORENSIC IN BANKING SECTOR

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Details

Type Project
Department Banking and Finance
Project ID BFN0933
Price ₦3,000 ($9)
Chapters 5 Chapters
No of Pages 67 Pages
Methodology empirical analysis
Reference YES
Format Microsoft Word

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    Details

    Type Project
    Department Banking and Finance
    Project ID BFN0933
    Price ₦3,000 ($9)
    Chapters 5 Chapters
    No of Pages 67 Pages
    Methodology empirical analysis
    Reference YES
    Format Microsoft Word

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