EVALUATING THE EFFECTIVENESS OF FORESIC ACCOUNTING IN COMBATING FINANCIAL CRIMES IN NIGERIA’S PUBLIC SECTOR.

Abstract

In this study, it was shown the effectiveness of forensic accounting in combating financial crimes in Nigeria’s public sector being evaluated. The advent of forensic accounting brought about a paradigm shift in the way financial crime is tackled in terms of detecting, combating, and preventing it. It is worrisome that most of the individuals who perpetrated this act go scot-free because the government cannot provide substantial evidence in court to prove that funds had been siphoned. In an attempt to address the menace, the study established the existing financial-related crimes as well as evaluating the forensic accounting tools/skills available in combating them; the study also assessed the critical challenges facing forensic accounting in the Nigerian public sector. Two hypotheses were tested to evaluate the effectiveness of forensic accounting in combating financial crimes in Nigeria’s public sector. The first hypothesis stated that there exist no significant positive relationship between Forensic accounting Tools/skills and financial crimes in Nigeria’s public sector, while the second hypothesis stated that there is no significant positive relationship between the challenges of forensic Accounting and its effectiveness in combating financial crimes in Nigeria’s public sector. The hypotheses were tested with the use of Partial Least Square Structural Equation Modelling (PLS-SEM). The study adopted a quantitative method and cross-sectional research design. The primary data used were gathered through a well-structured questionnaire, designed and administered to 210 respondents in the four ministries, 176 representing 83.81% of the questionnaire were correctly filled and returned. The returned questionnaires were coded and analyzed, using Mean Score Ranking and Partial Least Square Structural Equation Modelling (PLS-SEM) and it was revealed that the first five most ranked financial crimes are; kitting and stealing, forgery, embezzlement, smuggling, and human trafficking, corporate crime, fraud and counterfeiting. The findings indicated that the first five tools ranked by the mean scores for combating financial crimes in Nigeria’s public sector are; court proceeding, accounting, investigation, auditing and reporting. The findings also showed that lack of transparency and prosecutorial competes are the major challenges facing financial crimes in Nigeria’s public sector. Other challenges are; manipulated audited financial statement, task of gathering, and lack of cooperation. Based on the findings and hypotheses tested, the study concluded that forensic accounting is an effective tool in preventing and combating financial related crimes in the Nigerian public sector. Therefore, more emphasis should place on its utilisation in the public sector in order to rid the system of criminals while, creating a more transparent and crime free system.