(A CASE STUDY OF NIGERIAN PORTS AUTHORITY PLC)
This researches the challenges facing the internal auditors in public corporation.A case study of Nigerian Port Authority, Lagos is impartial fulfilment of the condition for the award of Higher National Diploma in Accountancy. It contains useful information on the Internal Audit procedure to the entire department in the authority coming with the scope of audit function. It discusses the weaknesses in the system and suggests way of improving these weaknesses. The recommendation contained there in if prudently implemented will go a long way in alleviating the problem passed by these weakness, facts and figures used in this research work were derived from published journals and various book use in the Authority including questionnaire.The management should make the implementation of the recommendations contained in this research a matter of urgency, so as to remedy the weaknesses in the system.
LIST OF TABLES
1. Under charges of customers deleted and recovered from
recovered from checking of debt note 1999
11. Under charges of customers deleted and recovered from
checking of debit note 2000
111. Over payment to contractors deleted by audit in 1999
1V. Over payment to contractors deleted by audit in 2000
One question one: The sex male/female. Two do you have internal audit department in your company. Three How is your opinion is the role of internal control system in an organisation. Four do you accept that internal audit is a major factor for the management in checking the company policies with the duty discharge? Five Internal audits is capable of preventing and protecting (Organisation) against atrocity perpetration. Six do you support the idea that one of the reasons why there has been a growth in internal has been a growth in internal audit is the need to improve the efficiency of management control system.
TABLE OF CONTENTS
1.1 Historical Background of NPA Plc
1.2 Purpose of Study
1.3 Significance of Study
1.4 Statement of Problems
1.5 Scope and Limitation of Study
1.7 Research Methodology
2.0 Literature Review
2.1 The Concept of Internal Auditing
2.2 Evolution of Internal Auditing
2.3 Positioning of the Internal Auditing Function
2.4 Purpose and Objective of Internal Auditing
2.5 Internal Control and Its Relevance to the Internal Audit
2.6 Distinction Between the Internal Auditor and the External Auditor (Statutory Auditor)
2.7 Main Corporate Objective of the Authority
2.8 Role of Internal Audit Department
2.9 Relationship with other Staff Function and Department
2.10 The audit master programme
3.0 Research Methodology
3.1 Research Design
3.2 Data Collection Methods
3.3 Population Characteristics
3.4 Sample Size
3.5 Sample Procedure
3.6 Reliability of Data
4.0 Data Analysis and Presentation
4.1 Data Analysis
4.2 Restatement of the Hypothesis
4.3 Testing of the Hypothesis
4.4 Analysis and Evaluation of Questionnaire
5.0 Summary Conclusion and Recommendation
5.1 Summary Findings
Definitions of terms
This research is a study of the challenges facing the internal Auditors in Government parietals. It attempts to highlight the role and functions of Internal Auditor in an organisation.
The Internal Auditor is regarded as a watchdog to the management and the whole organisation. To what Extent, and with what degree of independence he performs the duty of a watchdog is the subject of this study.
In order to get a clear picture of the role of Internal Auditor in an organisation vis-à-vis the challenges facing him. Research effort is directed at drawing the distinction between internal Auditor and External Auditor in terms of responsibility. Scope of work and their approach to work, it is therefore, hoped that this study will give an in sight into the role of Internal Auditor in Government parastatals in general and NPA in particular, and also serve as reference for those who Intend to conduct research in similar fields in future.
1.1 HISTORICAL BACKGROUND OF THE NIGERIAN PORT AUTHORITY
The history of the Nigerian ports Authority dates backs to the time of the slave trade or the colonial masters when the ports/ Territorial waters. In 1862, a department known as marine department then had regional headquarters established and located at the following places.
(a) Lagos colony marine – 1862 – Lagos
(b) Southern Nigeria marine – 1993 – Calabar but later transferred to Akasa in 1902
(c) Northern Nigeria marine-1900-Lokoja in 1960, two of the Regional Head Quarters, i.e. Lagos Colony marine were merged to become Southern Nigerian marine.
In 1908, a separate Government department know as port department was formed to take charge of civil Engineering works in Lagos and Port Harcourt ports. This was followed with the creation of the Nigerian marine in 1914 with two Regional Head Quarters as founding members.
FUNCTION F THE NIGERIAN MARINE
After its creation in 1914, the Nigerian marine took over the functions of the Regional Head Quarters and some these functions Included dredging, to wage, dockyard, Naval petrol services, light rage services, smuggling petrol’s, become (see traffic and provision of transport to other government departments). But after some years of operation, it became glaring that the Nigerian marine could net single handedly carry out its functions. As a result of this, its duties and functions were further reversed. In a bid to rectify the situation, the colonial Government appointed a director of transport to take charged of all transportation matters with particular reference to port operation in 1938, but this experiment could not start the test of time and so it was later abolished.
THE CREATION OF THE NIGERIAN PORTS AUTHORITY
With the end of the word war in 1945, the British Government become more interested in the economic and commercial activities of the Nigerian ports.
This increased interests warranted the limitations of a Remnant British post Administrator to look in the possibilities of establishing ports Authority in the country. Series of meetings and consultations were held with this British Administrator and it was during one of such meetings held, on 1st of September 1950. That professor Gilbert wailer suggested the appointment of an export management to advise on possible re-organisation of the exiting arrangement on 3rd march, 1952.
The Nigerian Government appointed Sir, Clifford Dive, an expert on port management as General manager (ports) with effect from 10th October 1952. He was to study the existing system of port operation in the country and recommend a suitable organisation charged with the responsibility of all port matters in the country.
The Government examined the reports and its Rending were thereafter promulgated into port Act in August 1954 (cap. 155) which resulted in setting up of the Nigerian port Authority (NPA) as an autonomous public corporation. The Nigerian port Authority Commenced full operations on 1st of April 1965 with its motto as MARI TARRAQUE SERVIMUS (ON LANDSEA SERVE). PORT DEVELOPMENT AND ESTABLISHMENT (1956-1982).
The Nigerian ports Authority planned and executed its first where extension projects between 1956 and 1961 for the ports of Lagos and Port Harcourt. During this period, sic berths with a total quay length of 506 metres were completed in Lagos ports Authority complete the constructions of new ware house in Apapa and modern floating Dock with 4,000 tonnes of lifting capacity in Lagos for the repair and maintenance of ships. (1962-1968).
The execution of the second extension project Apapa quays stated immediately after the first one. The construction work on the four berths, each of 152 meters in length flour transit shed and two warehouses were completed before the army took over in January 1966.
In Port Harcourt, an additional berth of 137 meters in length was constructed. During the period under review, a total of n45 million was spent on various development projects. (1969-1970)
When the Nigerian civil war was on, all the Nigerian ports with exception of Lagos ports were closed down to foreign traffic. This resulted in the tremendous flow and big concentration of good in Lagos. The Lagos PORT was made to handle cargoes much beyond its design capacity and this created the first congestion in the Nigerian Ports. The federal military government had to enact special degree empowering the authority to take over all the port which the privately owned.
As a result, the authority acquired the port of Warri from Holts Transport at a cost of
N1.62 million, Brutu from UAC Nigeria Ltd at N1.20 million and Calabar from fire operations at estimated cost of 0.63 million.
TIN- CAN ISLAND PORT
The ultra modern port constructed at a cost of N 193.3 million and commissioned on 14th October 1877.
NEW WARRI PORT
The project was executed at a cost of n 88million and commissioned on 16th July 1979.
FEDERAL LIGHTER TERMINAL ON (RIVER PORT)
The project started in April 1979 and 1979 and was into operation in November 1981, a total of N 31-38 million was succumbed on this project.
NEW SAPELE PORT
The construction began in 1981 and was commissioned on Ist of May 1982 (but has now been taken over by the Nigeria navy).
FEDERAL OCEAN TERMINAL (RIVERS PIORT)
A total of
N10 million contract was awarded for this first project and construction WORK commence during 1979/80 financial year .the port has since commence operation
3RD WHART EXTENSION
This was constructed at a cost of N 88 million and commission for operation on 9th of June 1979.
NEW CALABAR PORT
Constructed at a cost of 58 million and commission for operation on 9th of June 1979 TECHNOLOGICAL INNOVATION.
Researched into modern technology both fright and passenger traffic the end of the World War Introduce Chances in Shopping Industries. The older system of horse cargoes are now utilized, i.e. tied together or packed in container thus highly specialised vessels such as Rero Vessel came into being together with relevant handling equipment. With these berths at Nigeria ports Viz Apapa, Tin Can Island and Warri Port respectively.
RORO CONCENPT/ IDEM OF RORO
Roll-on-roll- off (Roro) system is a new ideal/ concept in the maritime world, it came into use as new dimensional approached or ideal basically introduced to combined our contain erased cargoes and container our container operations to achieved greater flexibility or ease roll-on-off (Roro) system require become in trade, for it can carry manufactured goods in one direction and raw materials/ products in the other.
Roll-on-roll-off operation has encouraged: -
a. Frequent cargo handling
b. Reduce pilferage and damage to minimum
c. Permitted speed and quick turn-round of ships
d. Enhance through transits
THE ORIGIN OF RORO TERMINAL COMPANY
In the late seventies, the Nigeria port authority looking inward into operation and its bid to develop the nation economy, decided to form a Roro Operation Unit.
Invitation went out and forms a series of interested applicant Umerco won the Roro tender contact in1979 to run for a renewable period of five years.
Umerco on its own invited more European Companies to help in running Rero. Because of indigenisation degree promulgated in 1979 by federal government of Nigeria, chief Bode Akinde was made the chairman of the company existed for twelve years until then Nigeria port authority terminated the contract on Ist may 1991.
NEPA REMOVED FROM CIVIL SERVICE
On 22nd may 1992, under the government privatisation and commercialisation programme? Nigeria port authority was given a new authority under the arrangement. It will be called Nigeria port plc (NP PLC). The Nigeria port plc will now shared its statutory cooperation under port act of 1955 and register as Limited Liability Company and allied matters decree of 1990. Its administration has been decentralized into western central and eastern zones with a slim Corporate Head Quarters.
The agreement was endorsed by Transport and Communication Minister, Mr. Olawle Ige. Technical committee on privatisation and Hamza zayeead and chief executive of NPA MR. Anthony, Abayomi, Awaya.
1.2 PURPOSE OF STUDY
The purpose of this study are as follows:-
i. To ascertain the effect of internal audit on company’s performance
ii. To show how internal audit influence management and administration
iii. To used in satisfying in Higher National Diploma Award. And in this modern time. Most organisations, large or small have an internal auditor whose responsibility is the development. Maintenance and appraisal of adequate internal check. As a research topic.
This study will enable the researcher appraise the effectiveness of the internal auditor in measuring and evaluating the effectiveness controls internal control. The researcher has delved into the historical background of the Nigeria port authority as the case study of their research. The research is not an end in itself, the recommendation contain their in it’s carefully, prudently and religious supplement will go a long way in achieving a more efficient and improved system of internal control. The research is a semi thesis, which can further deveop in future.
1.3 SIGNIFICANT OF THE STUDY
The study is intended to:
1. Serve as quite for any for any other researcher who want to carry a work on this topic
I. Benefit the management of the organisational seeking orderly manner of discharging duties effectively
II. Create new audit work that is possible to provide more enlighten on the internal audit work.
1.4 STATEMENT OF PROBLEMS
Most organisation are having problem in the following dealings
i. Safeguarded of company assets
iii. Efficient and effective discharge of duties
iv. Secure completeness and accuracy of records
v. Adherence to management policies
This study seeks also to identified the challenges that are face by the internal auditor in public cooperation with particular references to Nigeria port authority.
The authority is a state monopoly and like other state m9onopolies e.g. national electric power authority (N.E.P.A) Nigeria national electric power authority (N.E.P.A) nigeria national petroleum corporation (NNPC) etc. there is an internal audit department charge with the responsibility of monitoring, operating efficiency and compliances with the author policy, and also to enhance management’s confidence in the reported performance of the operating unit of organisation. What is needed for internal audited-apartment is a detached mind, free from the subjective opinion of managers concerning the performance of individual operating department this study will look at how the objectives of Internal Audit Department are achieved.
The following hypotheses are formulated using Nigeria port authority places a case study. Ho represented null hypothesis and hi represents alternative hypothesis as show below:
i. Ho: internal audit is a major element of internal control system
Hi: internal audit is not important in internal control system
ii. Ho: internal audit is a good system in discharging a duty effectively
Hi: internal audit is a not a system for discharging a duty effectively
iii. Ho: internal audit can prevent and detect fraud and irregularities
Hi: internal audit help the management in achieving its aim and objectives
Hi: internal audit dose not help the management in achieving its aim and objectives.
1.8 RESEARCH METHODOLOGY
All the procedures that would be adopted relevant literature will be reviewed. Hypothesis formula will be tested by using Nigeria port authority (NPA PLC) as the case study. Data would be collected text the hypothesis. This data will be collected through observation, interview and the use of questionnaires both primary and secondary data.
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