Application Of An Accessment Of Effective Internal Control And Audit In Public Sector

Public Sector
Public Sector
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Auditing is an independent checking, investigation, examination and expression of the books of accounts and vouchers of a business enterprise with a view to enable the appointed auditor to report whether the trading, prodit and loss accounts and balance sheet are properly drawn up so as to show a true and fair view of the state of affairs and the profit or loss of the business according to the best information and explanation obtained by the auditor and that they comply with the laid down rules and regulations of the statement of standard acccounting product (SSAP) and other statutory regulations.

Internal control system: This can be described acording to auditing guideline (AG 204) as “the whole system of controls, financial and otherwise, established by the management in order to carry on the business enterprise in an orderly and efficient manner, ensure adherence of maangement policies, safeguard its assets and secure as this as possible the completeness and acccuracy of records” therefore this involves both internal check and audit.

Internal Check: This briefly refers to the method (techniques) of organizing and arraning the entire operation of office, factory and enhousing and the duties of respective staff so that risk of fraud, errors, irregularities and mismanagment will almost be impossible without conclusion. That is day-to-day transactions, segregation of duties and job performance in an organization.

Internal Audit: This is refers to an independent appraisal of activities within the organization of the check of certain operations as a service to the maangement, therefore, it is the maangement control to functions by the means of evaluating and measuring the  efficiency and effectiveness of other controls or checks. Meanwhile, the internal audit will ensure that some specific routine work are carrryout by the departments and that the laid down procedures  is adequately carry-out by all applicable areas as well as making recommendations to the management.


Auditing in its daily and primitive stage can in an existence since 16th Century, start when the first relationship began between those who provided capital and those who managed the business.

Moreover, the innovation of joint stock companies has enormously widened the possiility of raising capital for industry. As a result of the limited liability of the shareholders, it become possible to offer shares for subcription to the public and thus, the availability of capital to both industry and commence. “Stewardship”

Meanwhile, under the company from of business enterprises, the shareholders as a person, delegate the management of the enterprise to the board of directors and practically, the board submits to the shareholders the account of the enterprise so that its members may see a trur and fair view of the financial position and the profit and loss undertaking. Thus, in 19th century, the greatly arose  aneed by the shareholders as a body to appoint an auditor that will help in the presentation of statutory financial statement of the board of directors in order to show true and fair view of the financial position of the company.

However, in 20th century, mandatory provision as requirement made for the audit to limited liability accounts and presentation of audit report to numbers by the company acts in Nigeria have company or companies and Allied Matters Act (CAMA) 1990.


This study is basically concerned with discussing and appraising an assessment of effective internal audit and control in the public sector. And also how to answers some related questions like;

  • How has the effective internal audit and control affected the public sector over some years?
  • How Does the effective system of internal audit control affect management policies towards records keeping, risk of fraud and errors, mismanagement, job functions and proper coordination.
  • How does the system take care of vouchers, payable, bank reconciliation statement and prevention of overpayment as well as
  1. To clearly demonstrate the impact effective internal control and audit in the public sector.
  2. To clearly and effectively specify the adequate control and mnaagement mechanisms to put in place in the public sector.
  3. To indicate the performance scope of internal control and audit in the public sector towards quality of financial information, organization’s growth, improving it efficiency at the costs lower as possible improvement of social environment.
  4. To clearly explain the system audit general description as to executive a continual analysis of a central authority. And organization’s reporting monitoring team thus the management.
  5. To make possible contribution to human knowledge as well as reduction or prevention in management, risk of fraud, irregularities and errors.


The main aim of public sector is for public utility (satisfaction) while internal cotrol and audit is for maintennace and keeping of accurate, complete and valid financial records and transaction daily as well as safeguard of assets in order to prevent and eliminate errors and fraud. Therefore public sector, particularly corporate affairs commision (CAMA) meanwhile, the following hypothesis will be tested in the course of the study.

 Null Hypothesis (Ho): the accuracy, completeness and validity of financial records and maintenance, safeguard and custody of assets of an organization as well as the elimination and prevention of fraud, errors, irregularities and mismanagement do not tally with the efficiency and effectivenes of effective internal audit and control in the public sector.

Positive Hypothesis (H1): The accuracy, completeness and validity of financial records and maintenance, safeguard and custody of assets of an enterprise as well as the elimination and prevention of fraud, errors, irregularities and mismanagement do not tally with the efficiency and effectivenes of effective internal audit and control in the public sector.


The significance of this research study is to fish out the efficiency and usefulness of strict adherence of the effective internal control and audit towards public sector in Nigeria as it affect.

  1. The effective management policies towards the maintenance, safeguard and custody of assets in public sector.
  2. The strict mnagement policiies towards day to day transactions (activities), records as the salaries and wages of the commission in order to prevent and eliminate the risk of fraud errors, irregulaties and mismanagement in the public sector and otherwise.
  • The need to facilitate government interest towards the getting-up public sector or corporation (enterprises) wihtout being punicky of fraud, errors, irregularities and mismanagement in the public enterprises.


The study is an assessment of effective internal audit and control using corporate attain commision Kaduna branch as case study. The study restricted itself to the internal control and audit of the commission. Therefore, it is based on the examinations and investigation of internal control system and  audit procedure in order to ascertain the efficiency and effectiveness of management policies towards fraud, error, irregularities and mismanagement prevention throughout the year.

Meanwhile, the control on the assurance of monitoring the registration fees, daily records and transactions, salaries and wages that is the emolument of the employees as well as the maintenance, safeguard and custofy of assets of the comission.


The corporate affairs commision (CAC) was established and incorporated in nigeria by section 1. of CAMA 1990 as a acrognm of companies and  Allied matters act 19090 to replaced the former company registry. Before this Act, the company registry was part of theministry of trade and commerce. Experience showed that this arrangement was not effective since adequate time and funds were not directed towards an essential area of the nation is economy like company formation, registration, management and administration.

Moreover, the commission was established as a corporate body, with perpetual succession and a common seal, capable name and acquiring, holding and disposal of all moveable and immoveable for the purpose of its function.

Meanwhile, the commission has its headquarters in Abuja the federal capital terriroty (FCT) and branches or subsidaries spread all over the federation according to section 1 (3) of CAMA 1990. The decentralization of power no doubt reduces the handship an expense of reaching the former company registry under the former framework.


Planning: this is the process of thining before activating. It is the most basic management function, which involves selection from among alternative duture worse of action in order to achieve a desirable goal. Therefore, it is the function t etermine where we are and where we are intended to be in accomplishing the organizational goal.

Policy: this is the general statement or understanding as laid down principles, normo, ethics and guidelines and channel thinking in decision making in an  organization towards its target goal.

Organization: this I sdefined as the  according to henry Foyol as “providing a business with everything necesssary or useful to its functions e.g. raw materials, tools, equipment, money and men”.

Management: It can be defined is the efficient and effective utilitization of human, social, political, economic and material resources for the acomplanish of the set of goal in the organization.

Responsibility: This is an act of exercising authority or influence to see that duties are performed.

Control: It is the ability of management to induce subordinates to work towards group goal with confidence and kindness.

Accounting: is the atc of recording, classifying, selecting, analyzing, interpreting and communicating the financial transactions of an organization to induce or enable users to make financial assesment and decision.

 Audit: It is an independent examination and expression of opinion on the financial statement of organization by an appointed auditor in accordance to the terms of his engagement and in compliance with any relevant stutory obligation and profession requirements.

 Examination: this means going into study of a particular idea information and fuel in order to get the real thing in all.

Independency: This means having five mind or liberty (freedom) in exercising one’s right without interference from outside. Therefore, according to professional or accounting profession, it means atitude of mind which is characterized by intergrity and objectivity.

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