Thesis Abstract

Abstract
Fraud continues to be a significant challenge for businesses and organizations worldwide. In response to this ongoing threat, forensic audit has emerged as a powerful tool for detecting and preventing fraudulent activities. This research project aims to explore the usefulness of forensic audit in the context of fraud detection and prevention. The study will first provide an overview of the concept of forensic audit and its key objectives. Forensic audit involves the application of accounting, auditing, and investigative skills to uncover fraud, financial irregularities, and other misconduct within an organization. By conducting a thorough examination of financial records, transactions, and systems, forensic auditors can identify red flags and potential instances of fraud. Furthermore, the research will investigate the various techniques and methodologies used in forensic audit to detect fraudulent activities. These may include data analysis, interviews, surveillance, and other investigative procedures. By employing a combination of these techniques, forensic auditors can gather evidence, reconstruct financial transactions, and ultimately uncover fraudulent schemes. The project will also examine the role of forensic audit in preventing fraud within organizations. In addition to detecting existing fraud, forensic audit can help implement robust internal controls and fraud prevention measures. By identifying weaknesses in internal processes and recommending improvements, forensic audit can help organizations strengthen their defenses against fraudulent activities. Moreover, the research will assess the challenges and limitations of forensic audit in the detection and prevention of fraud. These may include issues related to data availability, cooperation from employees, and the sophistication of fraudulent schemes. By understanding these challenges, organizations can better leverage forensic audit to enhance their fraud detection and prevention efforts. Overall, this research project will contribute to the existing body of knowledge on forensic audit and its role in combating fraud. By highlighting the usefulness of forensic audit in detecting and preventing fraudulent activities, this study aims to provide valuable insights for businesses, organizations, and practitioners seeking to enhance their anti-fraud strategies.

Thesis Overview

INTRODUCTION

1.1            BACKGROUND OF THE STUDY

The incidence of fraud and misappropriation of funds in recent time poses a threat to auditing as a branch of accounting profession because of its perennial nature. This has resulted to questions as to whether auditing actually play any significant role towards the attainment of accountability and prevention of fraud especially that which is currently happening in our major or key financial institutions.

Most of our financial institutions today fail to recognize that the phenomenon

“fraud” can appear to be more dangerous when compared to other forms of problem like armed robbery attack which can only affect the institution within a short period of time, such may have no long term effect on their operations. However, any significant fraud committed in an institution, not only undermines or shakes up it’s financial stability but can severely affect the reputation of the institution thereby resulting to investor’s loss of confidence.

Most times, the directors write off losses of fraud (including money laundering) under the general heading of “bad debt” rather than admitting that there have been a general failure to exercise or implement proper safeguards in the system of internal checks and control or managerial negligence in applying.