The Place of Forensic Accounting in External Audit Practice

Ibhawaegbele P.A.

doi:10.18535/ijsrm/v11i12.em17

Abstract

This study focused on the place of forensic accounting in external audit practice. The need for auditing was necessitated following separation of ownership from control. Auditing requires the external auditor to carry out an unbiased examination and investigation of the financial statement of any firm with a view to express an opinion on its truth and fairness in accordance. On the other hand, forensic accounting or auditing is a special audit for the purpose of litigation in the court of law. This implied that it required special methodological approach which is completely different from traditional or ordinary audit practice. Hence, this study specifically examined the need, skills, practice of forensic accounting and the relationship between forensic and traditional accountants or auditors. It is a library type of research. It solely employed secondary source of information. Information were obtained from textbooks, Journal articles, seminar papers, thesis etc. Having examined various related literature, it was revealed that the need for forensic accounting was to track crimes in various ways for the purpose of litigation in the court room and it is absolutely different from traditional audit because of exceptional skills required which can enhance external audit practice. It recommended that all professional accountants or practicing accountants should acquire knowledge in forensic accounting skills and all universities should run degree course in forensic accounting in order to aid knowledge of forensic skills in Nigeria.

Keywords

Forensic AccountingExternal Audit PracticeSkill

References

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Albrecht, C .C. & Albrecht, C. O. (2009). datadrisen fraud detection using detectless .Journal of forensic and investigation accounting, 1 (1), 1 – 24.Google Scholar ↗
Arnoff, N. B. & Sue, C. J. (2001). Forensic accountant's role as expert bef ore and during trial. New York law journal 226 (17), 3.Google Scholar ↗
Bhasin, M. (2007).Forensic accounting: A New Paradigm for Niche ConsultingGoogle Scholar ↗
Crumbley, D. L., Heitger, L. E & Smith, G. S.(2009). Forensic and Investigative Accounting. CCH Group. ISBN 0-8080-1365-3.Google Scholar ↗
Davia, H. R. (2000). Fraud 101: Techniques and strategies for detection. New York, NY: John Wiley and Sons, Inc.Google Scholar ↗
Davis, C., Ramona, F., & Ogliby, S. (2009). Characteristics and Skills of the Forensic Accountant (p. 277). US: AICPA.Google Scholar ↗
Digabriele, J. A. (2007). Fishbowl the forensic accountant: Are there diferences in the views of the relevant skills of a forensic accountant among practitioners, academics and users of forensic accounting services? Mont clair State University.Google Scholar ↗
DiGabriele, J. A. (2008).An empirical investigation of the relevant skills of forensic accountants. Journal of Education for Business, 331-338.Google Scholar ↗
Enofe, A.O., Ekpulu, G.A., & Ajala, T. O. (2015). Forensic accounting and corporate crime mitigation. European Scientific Journal, 11(7), 167-185.Google Scholar ↗
FRC. (2012). International Standard on Auditing (ISA) No. 700: The auditor’s report on financial statements.Google Scholar ↗
Ghosh, I. & Banergie, K. K. (2011). Forensic accounting: another feather in that hat of accounting. The chartered accountant, 60 – 63.Google Scholar ↗
Gray, D. (2008). Forensic Accounting and Auditing: Compared And Contrasted To Traditional Accounting and Auditing. American Journal of Business Education,1(2), 115-126Google Scholar ↗
Grippo, F. J. & Ibex, T. (2003). Introduction to forensic accounting. National Public Accounting, 4, 4 –8Google Scholar ↗
Harris, C. K., & Brown, A. M.(2000). The qualities of a forensic accountant, Pennsylvania CPA Journal, 71, 2-3.Google Scholar ↗
Hopwood, A. G. (2009), Reflections and projections and many, many thanks. Accounting, Organizations and Society, 34(8), 887-894.Google Scholar ↗
Hopwood, W., Leiner, J & G. Young. (2012). Forensic accounting and fraud examination, 2nd Edition. New York: McGraw-Hill/IrwinGoogle Scholar ↗
ICAN. (2009). The Institute of Chartered Accountants of Nigeria Public Sector Accounting Study Pack. VI Publishers, Lagos, Nigeria.Google Scholar ↗
IFAC. (2006). International Education Standard No. 8, Competence requirements for professional accountants.International Accounting Education Standard Board. International Federation of Accountants.Google Scholar ↗
Lamoreaux, M. (2007). Internal auditor used computer tools to detect Worldcom fraud. Journal of Accountancy, 35.67-93.Google Scholar ↗
Messier, W. F., Glover, S. M., & Prawitt, D. F. (2006). Auditing & Assurance Services: A Systematic Approach. Issues in Accounting Education, 21 (3), 330.Google Scholar ↗
Milucky, J.J. & Mac, C. (2013). Forensic accounting specialist on corporate governance, the role of the auditors and the legal context.[Accessed: 26/06/2015].Google Scholar ↗
Modugu, K. P. & Anyaduba, J. O. (2013). Forensic accounting and financial fraud in Nigeria: An empirical approach. International Journal of Business and Social Science, 4(7).Google Scholar ↗
NFAAF. (2011). The National Fraud Action Agency for Fraud 2011, “Fighting fraud together: the strategic plan to reduce fraud”. USA.Google Scholar ↗
Nigeria KPMG. (2012). Africa Fraud Barometer Result: “Nigeria: KPMG - Nigeria, most fraudulent country in Africa”. This Day Newspaper, November 23Google Scholar ↗
Owojori, A. A., & Asaolu, T. O. (2009).The role of forensic accounting in solving the vexed problem of the corporate world. European Journal of Scientific Research, 29 (2), 183-187.Google Scholar ↗
Popoola, O.M. J., Ahmad, A. C., Shamsiah, R. S., & Rushami, Z. Y. (2013). Impact of task performance fraud risk assessment on forensic skills and mindsets: Experience from NigeriaGoogle Scholar ↗
Zia, T. A. (2010). Development, Delivery and Dynamics of a Digital Forensics Subject. Digital Forensics conference (p. 175). Presented at the 8th Australian Digital ForensicsGoogle Scholar ↗
Zimbleman, M.K., Albrecht, C.C., Albrecht, S.W. & Albrecht, C.O. (2012).Forensic accounting, engage Learning, International edition Canada, 4th Edition. 429.Google Scholar ↗
Zysman, A. (2009). Litigation: forensic accounting demystified. Retrieved from; http://www.forensicaccounting.com/home.html.Google Scholar ↗

[refR-1] Adebisi, F. A. (2011). Audit, investigation and forensics: Similarities and differences. Institute of Chartered Accountants of Nigeria: Forensic, Audit & Investigation Faculty, February 2011.Google Scholar ↗

[refR-2] Albrecht, C .C. & Albrecht, C. O. (2009). datadrisen fraud detection using detectless .Journal of forensic and investigation accounting, 1 (1), 1 – 24.Google Scholar ↗

[refR-3] Arnoff, N. B. & Sue, C. J. (2001). Forensic accountant's role as expert bef ore and during trial. New York law journal 226 (17), 3.Google Scholar ↗

[refR-4] Bhasin, M. (2007).Forensic accounting: A New Paradigm for Niche ConsultingGoogle Scholar ↗

[refR-5] Crumbley, D. L., Heitger, L. E & Smith, G. S.(2009). Forensic and Investigative Accounting. CCH Group. ISBN 0-8080-1365-3.Google Scholar ↗

[refR-6] Davia, H. R. (2000). Fraud 101: Techniques and strategies for detection. New York, NY: John Wiley and Sons, Inc.Google Scholar ↗

[refR-7] Davis, C., Ramona, F., & Ogliby, S. (2009). Characteristics and Skills of the Forensic Accountant (p. 277). US: AICPA.Google Scholar ↗

[refR-8] Digabriele, J. A. (2007). Fishbowl the forensic accountant: Are there diferences in the views of the relevant skills of a forensic accountant among practitioners, academics and users of forensic accounting services? Mont clair State University.Google Scholar ↗

[refR-9] DiGabriele, J. A. (2008).An empirical investigation of the relevant skills of forensic accountants. Journal of Education for Business, 331-338.Google Scholar ↗

[refR-10] Enofe, A.O., Ekpulu, G.A., & Ajala, T. O. (2015). Forensic accounting and corporate crime mitigation. European Scientific Journal, 11(7), 167-185.Google Scholar ↗

[refR-11] FRC. (2012). International Standard on Auditing (ISA) No. 700: The auditor’s report on financial statements.Google Scholar ↗

[refR-12] Ghosh, I. & Banergie, K. K. (2011). Forensic accounting: another feather in that hat of accounting. The chartered accountant, 60 – 63.Google Scholar ↗

[refR-13] Gray, D. (2008). Forensic Accounting and Auditing: Compared And Contrasted To Traditional Accounting and Auditing. American Journal of Business Education,1(2), 115-126Google Scholar ↗

[refR-14] Grippo, F. J. & Ibex, T. (2003). Introduction to forensic accounting. National Public Accounting, 4, 4 –8Google Scholar ↗

[refR-15] Harris, C. K., & Brown, A. M.(2000). The qualities of a forensic accountant, Pennsylvania CPA Journal, 71, 2-3.Google Scholar ↗

[refR-16] Hopwood, A. G. (2009), Reflections and projections and many, many thanks. Accounting, Organizations and Society, 34(8), 887-894.Google Scholar ↗

[refR-17] Hopwood, W., Leiner, J & G. Young. (2012). Forensic accounting and fraud examination, 2nd Edition. New York: McGraw-Hill/IrwinGoogle Scholar ↗

[refR-18] ICAN. (2009). The Institute of Chartered Accountants of Nigeria Public Sector Accounting Study Pack. VI Publishers, Lagos, Nigeria.Google Scholar ↗

[refR-19] IFAC. (2006). International Education Standard No. 8, Competence requirements for professional accountants.International Accounting Education Standard Board. International Federation of Accountants.Google Scholar ↗

[refR-20] Lamoreaux, M. (2007). Internal auditor used computer tools to detect Worldcom fraud. Journal of Accountancy, 35.67-93.Google Scholar ↗

[refR-21] Messier, W. F., Glover, S. M., & Prawitt, D. F. (2006). Auditing & Assurance Services: A Systematic Approach. Issues in Accounting Education, 21 (3), 330.Google Scholar ↗

[refR-22] Milucky, J.J. & Mac, C. (2013). Forensic accounting specialist on corporate governance, the role of the auditors and the legal context.[Accessed: 26/06/2015].Google Scholar ↗

[refR-23] Modugu, K. P. & Anyaduba, J. O. (2013). Forensic accounting and financial fraud in Nigeria: An empirical approach. International Journal of Business and Social Science, 4(7).Google Scholar ↗

[refR-24] NFAAF. (2011). The National Fraud Action Agency for Fraud 2011, “Fighting fraud together: the strategic plan to reduce fraud”. USA.Google Scholar ↗

[refR-25] Nigeria KPMG. (2012). Africa Fraud Barometer Result: “Nigeria: KPMG - Nigeria, most fraudulent country in Africa”. This Day Newspaper, November 23Google Scholar ↗

[refR-26] Owojori, A. A., & Asaolu, T. O. (2009).The role of forensic accounting in solving the vexed problem of the corporate world. European Journal of Scientific Research, 29 (2), 183-187.Google Scholar ↗

[refR-27] Popoola, O.M. J., Ahmad, A. C., Shamsiah, R. S., & Rushami, Z. Y. (2013). Impact of task performance fraud risk assessment on forensic skills and mindsets: Experience from NigeriaGoogle Scholar ↗

[refR-28] Zia, T. A. (2010). Development, Delivery and Dynamics of a Digital Forensics Subject. Digital Forensics conference (p. 175). Presented at the 8th Australian Digital ForensicsGoogle Scholar ↗

[refR-29] Zimbleman, M.K., Albrecht, C.C., Albrecht, S.W. & Albrecht, C.O. (2012).Forensic accounting, engage Learning, International edition Canada, 4th Edition. 429.Google Scholar ↗

[refR-30] Zysman, A. (2009). Litigation: forensic accounting demystified. Retrieved from; http://www.forensicaccounting.com/home.html.Google Scholar ↗