This website uses cookies to ensure you have the best experience. Learn more

Internal Control System Essay

5108 words - 21 pages

INTRODUCTION

Internal control, the strength of every organization, has become of paramount importance today in Nigerian banks. The reason being that the control systems in any organization is a pillar for an efficient accounting system.

The need for the internal control systems in the organizations, especially banks, cannot be undermined, due to the fact that the banking sector, which has a crucial role to play in the economic development of a nation is now being characterized by macro economic instability, slow growth in real economic activities, corruption and the risk of fraud.

Fraud, which is the major reason for setting up on internal control system, has become a great pain in ...view middle of the document...

However, this study is aimed at verifying the conception that an effective and efficient internal control system is the best control measure for preventing and detecting fraud, especially in the banking sector.

The questions are: what can be said to be the cause or causes of the increasing rate of fraud in banks? What are the effects or damage has fraud caused banks, her customers? What is the impact of internal control in the prevention and detection of fraud in banks?

Objectives of the study: The objective of this study is to determine the impact of internal control, on the overall management of Nigerian banks. Also, to examine the effect of the internal control systems, when it comes to fraud prevention and detection. Summarily, the specific objectives are: to highlight the major causes of fraud and actors that contribute to the incidence of frauds in banks. To determine the problem of fraud and how to curb it, by. To make recommendation based on the findings?

Hypotheses tested: Two hypotheses are formulated and tested in this study.

H0 : The lack of a good internal control is not a major cause of fraud in banks.
H1 : The lack of a good internal control is a major cause of fraud in banks.
H0 : Banks with internal control systems cannot prevent the menace of fraud.
H1 : Banks with internal control systems can prevent the menace of fraud.
Scope of the study: The content of this research, should not be seen as being totally exhaustive of all possibly situations available in the Nigerian Banking sector on the theme of this study. This is due to the vast size of the banking sector and the boundless nature of the study under review. Therefore, the scope of this research is limited to the study carried out on Wema Bank branches in the South-Western part of Nigeria, particularly 50 selected branches. In the following states; Ekiti, Ondo, Oyo, Ogun, Osun and Lagos.

MATERIALS AND METHODS

The data, from which the information constitute the findings, were collected from fifty branches of Wema Bank Plc. This involved traveling to all the above mentioned states and asking the officers in charge, some prepared questions in which answers were provided accordingly. Data were obtained from both the primary and secondary sources, which includes; interview, structured questionnaire, journal publications, textbooks, newspapers, internet facilities. Secondary data are used to complement the primary data as the primary data is the original work.

Data captured for this study were analyzed through descriptive and inferential statistical methods. The descriptive analysis involves the use of percentages, tabulation and graphical presentation. While, the inferential statistical method involved the use of the chi-square.

Review of related study: A usual adage says prevention is better than cure; so also, people say that one should look before one leaps. These statements are more or less the equivalents of an internal control system. It is...

Other Papers Like Internal Control System

Internal Controls Essay

1372 words - 6 pages principles chosen by management have general acceptance and are appropriate in the circumstances. Financial statements must also reflect underlying transactions and events in a way that presents the financial position, results of operations, and cash flows within a reasonable limit to be fairly presented (PCAOB). The system of internal control used by the company for financial reporting should include the design and implementation of those policies and

Accounting 280 Week 8 Essay

931 words - 4 pages Internal Controls Your Name XACC/280 1/14/2012 Internal Controls Internal control is designed to govern a company’s financial system by ensuring effective and efficient operations, reliable financial reporting, and compliance with applicable state and federal laws and regulations. Internal controls safeguard assets against theft and unauthorized use, acquisition, and disposal. A system of internal control serves to enhance

Recommendation Brief for an Internal Accountant

674 words - 3 pages Recommendation Brief for an Internal Accountant 1 Recommendation Brief for an Internal Accountant Kelsy Fee ACC/544 April 13, 2015 Professor La Ron Roach Recommendation Brief for an Internal Accountant 2 In this recommendation brief the benefits of hiring an internal accountant will be discussed. Having an internal accountant would help fix an out-of-control system and the justification of taking

Internal Control

877 words - 4 pages guarantee that will never happen. Several limitation of internal control system prevents management from obtaining complete assurance that controls are absolutely effective. They are: -human error due to mistakes in judgment, fatigue, and carelessness still can occur. –Management override, -collusion among people. Additionally, internal control is subject to cost-benefit considerations. Internal control could be making perfectly, but at great

Latvia - Audit

1106 words - 5 pages of internal audit units and heads of institutions in the field of internal auditing and internal control system. To facilitate the independence of the internal audit, the Internal Auditing Council was established in accordance with the Cabinet of Ministers' regulations Nr. 346 "Statutes of the Internal Audit Council" approved on 5 October, 1999. The members of the Council were appointed on 9 August 2000 by the Cabinet of Ministers (Decree Nr

Kudler Fine Foods

1030 words - 5 pages Recently our firm was assigned the task of preparing a flowchart for possible systems that Kudler Fine Foods could use to enhance their business. After reviewing the flowchart, our client is now requesting that we provide information on controls that will be required for this system. This business brief will analyze the risks in the system, identify all risks and internal control points by displaying them in a flowchart, design internal controls

Analyzing the Managing Industrial Unrest: a Caribbean Conundrum from a Cultural Implications Angle

700 words - 3 pages Question 1 of the 2011 Examination Paper The success or failure of an entity depends on its system of controls both accounting and administrative. Identify and discuss some of the key factors of the internal control systems of an organization with which you are familiar. Internal Control is an integral process that is effected by an entity’s management and personnel and is designed to address risks and to provide reasonable assurance that

Kudler Fine Foods, Internal Control and Risk Evaluation

1013 words - 5 pages Kudler Fine Foods, Internal Control and Risk Evaluation Letticia A. Craps ACC542 May 7, 2010 Richard Westbay Kudler Fine Foods, Internal Control and Risk Evaluation Kudler Fine Foods has decided to go forward with the recommended course of action from Learning Team B, which was to buy an out of the box Accounting Information System (AIS). As with any implementation, consideration is given to existing internal and external controls

Developing and Implementing Effective Internal Controls and Maintaining Employee Morale

1323 words - 6 pages and objectives of internal controls (p.229). Broadly speaking, an internal control system includes policies and procedures that management designs and implements to provide reasonable assurance that its objectives will be met. Objectives may include but are not limited to: safeguarding assets, promoting efficiency and providing reliable financial information and records. Good controls encourage efficiency, compliance with laws, regulations

Internal Control

1436 words - 6 pages internal controls important? The overall purpose of internal control is to help a department achieve its mission and accomplish certain goals and objectives. An effective internal control system helps a department to:  * Promote orderly, economical, efficient and effective operations. * Produce quality products and services consistent with the department’s mission. * Safeguard resources against loss due to waste, abuse

Internal Controls

777 words - 4 pages Internal Auditor Ron Mathieu ACC/544 July 29, 2013 Joseph Poletti Internal Auditor A recommendation has been made for a publicly traded company to hire an internal auditor to clean up an out of control system. An out of control system could mean many things but none of them are desirable for any company especially one that is publicly owned. The company needs to maintain accurate financial records and produce correct financials

Related Essays

Internal Control System Justification Essay

672 words - 3 pages Internal Control System Justification Brandy Ritz ACC/445 May 5, 2014 Bunney Schmidt Internal Control System Justification Internal controls are a good way to keep records up to date and valid. Insurance and portfolio approaches are great to have set in place for risk management, but a system of controls would provide extra security with the books. Below is an overview of insurance and portfolio approaches along with why internal

Justification For An Internal Control System

657 words - 3 pages Justification for an Internal Control System Christine Griffin ACC 544 July 28, 2014 Richard Cornett Justification for an Internal Control System As the controller for my company, I monitor all financial activities, conduct audits as needed, create high-level financial reports, and implement accounting methodologies to make the company run efficiently (PayScale, n.d.). The leadership of the company has asked me why there is a need

Justification For An Internal Control System

936 words - 4 pages Internal Control Systems are very important for the risk management department of a company. This system helps keep the company protected from losing assets or incorrect use of assets. They also assist the company with keeping record and staying on track with objectives needed to be met. A controller’s duty would be to support management and the reporting of accounting and financial information. To start off, insurance and portfolios would

Evaluation Of System Of Internal Control Lbj Company

1037 words - 5 pages update on new regulation requirements that are required to be followed if LBJ Company intends to go public. In addition, we have evaluated your organizations system of internal controls and have provided below the strengths, weaknesses and recommendations. Regulation requirements: Due to the passing of the Sarbanes Oxley Act (SOX), all publically held companies are required to maintain a system of internal control. Corporate executives