ABSTRACT
Fraud and financial malpractice as a leading factor in business failure provides means of appraising company’s performance and diagnosing its ills and weakness.
The research conducted a critical study on this topic with the intention of finding out the extent to which a company, firm or business organization has carried out efficiently appraisals and highlighting deficiencies which are usually believed are not existing or whether the company is as efficient as it should be.
The researcher also carried out the cause of low company performance and how to eradicate the abnormality efficiency in auditing process.
CHAPTER ONE
1.0 INTRODUCTION
This research work is an attempt to study on fraud and financial malpractice as a leading factor to business failure.
Business can be seen as all profit directed towards providing goods and services to mankind. The business organization under usual condition of operation is the result of growth of any business. Individuals are to fill the various positions which will help the organization to achieve its desired objective.
Companies are today going through life threatening challenges which is the culmination of several years of abase and mismanagement from their employees. Some of the reason for these anomalies in business trends resulted in the general company down turn, ranging from fraud misappropriation of fund, lack of accountability and general company crises.
This write up will advantageously help companies on application of rigidly administered monetary policy instrument of their company.
1.1 BACKGROUND OF THE STUDY
Fraud is irregularities involving the use of criminal mind to obtain and gain illegal advantages. Fraud involving the manipulation of the records and the accounts usually by the company’s senior officers, with a view to benefit in some way from the false picture which they convey (e.g. Obtaining finance under false pretence, or concealing a material that will worsen the company true position).
Frauds, usually by employers, involving the theft, misappropriation or embezzlement of the company’s funds, usually in the form of cash, or of its assets (such as goods held in warehouse)
Fraud and financial malpractices in many business involving the public sector organization today contributes mostly to one of the sector that lead to business failure.
In all human endeavor and activities, there are
usually stories of success and achievement and failures, business are therefore no exemption initially, a motive for setting up a company for economic reasons which are usually taken to be profit maximization objectives. In period of booms as was experienced in mid-seventies during oil boom, making business including the public sector organization thrived in an era of abundance.
1.2 STATEMENT OF PROBLEM
A company whether small medium or large in developing country like Nigeria faces special problems which include fraud and financial malpractice. These problems include incomplete recording of account and poor attitude to adhere to the accounting standard and guideline on these key problem areas that undermine fraud and financial malpractice in a company and make suggestions about their possible solutions.
1.3 OBJECTIVE OF THE STUDY
This study is aimed at finding out the reasons why business fail and how to control them in other to undertake what business is and the role it is expected to play in the development of the nation including social and technologically what caliber of people are supposed to place in places of authority and trust such as managers, directors, staffs. How can a well managed business encourage investment from the government and private individuals.
This research will also help to find out how mangers, directors and staff manipulate figures and thereby throwing the internal control system into confusion and leaving the accounting system in shambles. It is also aimed at finding a preventive rather than a correlative approach to the fraudulent practices of our industries.
1.4 SIGNIFICANCE OF THE STUDY
This research is aimed at highlighting area of problems and to advise solutions. This solution if properly implemented will bring the government and the sandal public at large to associate themselves with investing in a company. It is however significant to undertake such study because it intend to give the researcher, a thorough and full understanding of the subject matter which is title: fraud and financial malpractice as leading factor to business failure. The research is also a paramount important because in form basis or standard format which is intended to be followed by other student. The government can also use it to improve in its economic projection and plans and adjust some of her economic policies.
1.5 SCOPE AND LIMITATION OF THE STUDY
For the purpose of this research work, the researcher will focus his attention on the study dwells on fraud and financial malpractice as a leading factor to business failure.
The researcher accounted and skipped so apply herds of both human and material blending before arriving at the conclusion stage of his work.
The major problems includes
i) FINANCIAL CONTRAINTS: A project work is a money consuming venture and it is normally sponsored by well to do individuals, firms and organization.
ii) TIME CONSTRICTION: The concentration of the researcher has to respond to various demands because each point in time has so many equally weighted competing factors.
iii) HUMAN FACTOR: The human factor relates to respondent problem encountered during the research process.
1.6 DEFINITION OF TERMS
FRAUD: Is defined either as misappropriation of cash and goods i.e. (decollation) or the falsification of accounts unaccompanied by misappropriation.
MISAPPROPRIATION OF CASH: Cash misappropriation is the alternative of cash so that the actual balance presents a different balance. This brought about employees when they hide the receipt of cash of falsify payments which are not authorized. Also a cashier can be used the teeming and leaning process of misappropriation of cash and later covered the receipt embezzled.
MISAPPROPRIATION OF GOODS: Where accurate record of goods in stock are not maintained of properly maintained. There is every possibility that the goods in stock will be misappropriated.
FALSIFICATION OF ACCOUNTS UNACCOMPAINED BY MISAPPROPRIATION: This type of fraud is brought about by to officials of the organization. It is false representation of a matter of fact whether by conduct or misleading allegation or by concealment of that which should have been disclosed which deceived or intended to deceive another so that he should act upon it to its legal infury.
MALPRACTIONS: This can best be described as acts or omission if any functionary company whereas contrary to the promotion of safe and sound practice.
