Thesis Abstract

<p> Ability to report back the conclusion of an assignment of the<br>progress made so far to the person(s) who delegated the authority<br>to the performer of an assignment, duty or function, has for<br>decades eluded this nation both in the private and public<br>responsibilities to be performed and performed and reported back<br>has been carried out as accomplished. The lack of accountability<br>leads to many vices in our social and economic system. The<br>objectives of this study therefore are (a) To ascertain the<br>determine the role of independent audit towards accountability in<br>an organization (b) To determine if independent audit can control<br>fraud and embezzlement. The primary data sources (the<br>questionnaire) collected response from thirty two (32)<br>respondents out of forty (40) that was sampled. Data collected<br>through primary sources were analyzed on tables using<br>percentages, three hypotheses were stated in null form and ere<br>tested using the X2 statistics, simple percentages and the test<br>revealed that audit enhances accountability in an organization<br>and also help in controlling fraud, embezzlement and defalcation<br>in an organization. <br></p>

Thesis Overview

<p> 1.0 INTRODUCTION<br>Accountability in both public and private section has being an issue that is<br>worth discussing due to its paramount and colossal impact to the overall<br>performance of an organization.<br>It (Accountability) has to do with reporting back action, task carried out by an<br>individual to the authority who apportioned such function.<br>1.1 BACKGROUND OF THE STUDY<br>Accountability is the process or act of reporting back to a higher authority,<br>body or individual the actions taken by a steward. It enables the person or<br>persons reported to determine if the steward has acted or performed the assigned<br>duties properly and satisfactory. It plays a major role in the success or failure of<br>any business, particularly when the business is not managed by its owner.<br>Initially most business set-ups were managed by their owners. The owners‟<br>manager was the sole financial contribution to the enterprise. But with the<br>development in the scale and scope of business, a huge capital beyond that<br>affordable by the sole individual or a family was needed. Consequently<br>contributors (hereafter called shareholders) were required to raise the funds for<br>the business. The emergence of these shareholders led to the divorce of the<br>owner managers from the management of the business as all of them cannot be<br>directors at the same time. This the management of business was entrusted to<br>the hands of people who have no financial claims to the business and the<br>shareholders were sceptical about this particularly as the law does not permit<br>them individually to go through the books of the company in their desire to keep<br>abreast of the performance of the directors.<br>2<br>This skepticism aroused the need for surveillance over the activities of the<br>non-owner managing directors. This bid to fulfil the later led to the engagement<br>of third-party (an Auditor) to perform an audit of the company‟s accounts.<br>Audit has since them received a lot of definitions and/or then received a lot<br>of definitions and/or interpretations both from accounting bodies and auditors<br>and their non-the-like. Justifiable is to say that audit has suffered a lot of<br>misinterpretations. Most of the misgiving interpretations see it as being armed at<br>fraud and error detection. But audit essentially involves much more than that.<br>One of the most involved and of course the most acceptable definitions so far is<br>that issued by the consultative council of accountability bodies (CCAB) which<br>sees audit as “the independent examination and expression of opinion on the<br>financial statement of an enterprise by an appointed auditor in pursuance of<br>statutory obligation (Howard 1982:1).<br>Deductively, an audit is the objective scrutiny of someone‟s work or<br>presentation by a third party (an auditor) who is different from the users and the<br>preparing of the presentation. The general essence of audit is to ascertain<br>compliance of the firm‟s records and operational policies with usefulness of<br>acceptability of and the dependability on the firm‟s financial statements.<br>Accountability as explained above has suffered some misconceptions,<br>surprisingly in the hands of those who should have understood it better. Most of<br>the lay men conceptual understanding of accountability relates it to<br>„communicating about monetary matters (Odon, 1999:7) but accountability goes<br>beyond that. According to the Webster encyclopaedia dictionary of English<br>language (1995:110), accountability is defined as “the state of being<br>accountable, answerable, liable or responsible” the same dictionary goes further<br>to define accountable as “liable to pay or make good in case of loss; responsible<br>to a trust, liable to be called to account, put in another way an much more<br>3<br>related to the context in the articles Aba times of fourth September 1999<br>captioned “accountability in the third republic” it says<br>Accountability connotes answerability and stewardship, by<br>answerability is meant answering for one‟s actions and<br>decisions (odon1999:7)<br>Stewardship according to the article means service; it means<br>that every leader should be responsible to the people who<br>reposed trust in him.<br>For accountability to be accorded its rightful place in an organization the writer<br>believes that there is a high need for proper internal control measure and in<br>addition, efforts should be made to ensure that company accounts are subjected<br>to external and independent audits after each financial period.<br>The bible also records in chapter 25 verse 14-30 of saint Matthew gospel,<br>the story of a rich man who went on a far journey entrusting the affairs to his<br>servants and who when he returned, required the servants to answer<br>individually, for their stewardship to the business while he was away. It in the<br>same manner that it is required of the chief executives and directors of a<br>company who are quite different from the real owners of the business to answer<br>for their stewardship of the funds and property entrusted to them by the<br>shareholders. It is desire for accountability that gave rise to what we know today<br>as audit- a mechanism through which the shareholders are made abreast of the<br>true and fair picture of the activities of the directors and chief executive of the<br>company<br>4<br>THE HISTORICAL BACKGROUND OF SHEFFIELD RISK<br>MANAGEMENT LIMITED, OWERRI<br>Sheffield risk management limited is located within the industrial layout<br>area of Owerri, it is established as a private limited liability company, it is an<br>incorporated company.<br>The company is an insurance brokerage firm that serves as an intermediary<br>between the insurer and the insured; they also serve as underwriter of insurance<br>policies. The insurance policies in which Sheffield risks management limited<br>act as intermediary between the insurer (insurance company) and the insured<br>(client) or consultant to each or both include Life insurance, Car insurance,<br>Burglary insurance, Motor vehicle insurance etc.<br>OWNERSHIP STRUCTURE<br>According to the memorandum of understanding signed by the stake<br>holders of Sheffield Risk Management, the company has its ownership structure<br>as shown below out of the start-up capital of twenty two million naira<br>(₦22,000,000).<br>Shareholders % Of shareholding Nominal value (₦)<br>Mr. David Okolie<br>Barr Obumneme<br>Okonkwo<br>Mrs. Mary Nwosu<br>Barr O. Oluchukwu<br>Mr Okey Elendu<br>50<br>22<br>18<br>6<br>4<br>11,000,000<br>4,840,000<br>3,960,000<br>1,320,000<br>880,000<br>5<br>BOARD OF DIRECTORS<br>Going by the memorandum and article of association of the company, it has<br>provision for six member board which comprises of the chairman, general<br>manager, company‟s secretary, marketing manager, company‟s accountant,<br>company‟s P.R.O.<br>This composition has been maintained throughout the company‟s existence <br></p>