Auditing Efficiency For Improving Companies Performances

This research work is conducted to assess auditing efficiency for improving companies performances.

The entire work is divided into five chapters, chapter one is an introductory analysis of the topic, then the background of the study, significance, scope and limitation, the purpose and hypothesis.

The second chapter dealt with the Literature Review and Theoretical consideration. Here related past works were reviews and the theoretical consideration on the present study was also brought into focus. As well as scope and nature of auditing efficiency and the result of auditing management.

Then, chapter three contains an explanation of how and where the needed information for the study was obtained and how the sample size was determined and the limitations encountered in the course of conducting the research. It also contains the method of investigation.

Chapter four dealt with the presentation and analysis of data collected during the field survey, after which the postulated hypotheses were tested.

Lastly, chapter five makes up the summary, conclusion and recommendations.

1.0 Introduction

1.1 Background of Study

Company performance is very important if such a company want to achieve its purpose of starting its business without positive impact of any organization, it means that the way of achieving the objectives when the business has commenced will be a difficult situation for that organization. It is obvious that the performances of companies sis not unto expectation. That is why the researcher wants to know the impact auditing create in improving companies performances.

Since companies have been encountering some problems like fraud, misappropriation of funds and properties, lack of effective management and others that made people to be asking whether auditing plays any significant role towards ensuring efficiency and judicious use of funds set aside for various purposes.

Some activities and programmes organized by people as re- assumed to be done on behalf of the people. They are deserved to be assured that eh resources which they put at the disposal of these programmes are effectively, efficiently and economically managed since it is known that not all are judicious in public affairs entrusted to them.

Therefore, for proper and efficient accountability, it is obvious that auditors will manifest their principles to be able to arrive at what is expected of them in order to be convinced that the financial position of the organization as presented show a clear and fair view of the organization.

Consequently, because of biased nature of the organization as a result of poor investigation of the organization position, past rulers have pledged to introduce a more responsible system of government with accountability but their subsequent conduct has shown that they have little or no understanding definition and application of efficiency in the improvement of companies performances.

Auditing which is regarded as one of the recently established professions turn out of the complexity of modern business world. It becomes relevant so as to discourage people from erring and to expose those that gave wrong account of how they managed the funds and properties under their custody. The account or report is usually done by means of financial statement. In order to verify the true and fair view of this report an independent person is needed to audit the account.

1.2 Statement of Problem

There are so many problems which affect auditing efficiency in organizations inspite, other related problem of this study are those caused by poor management control system, inadequate Training and Re-Training, Bad management, staff negligence, inadequate knowledge and experience of staff, security arrangement and use of sophisticated accounting machines and also poor remuneration.

A part from these, when appropriate recognition is not recorded to the auditing efficiency department the status of the head of the department is always lower and therefore inferior to the states of the Head of Department. Heads of other Department regard the head of auditing efficiency department"s subordinate offer in power.

1.3 Objectives of the Study

Objectives of the study include:

To ascertain if auditing efficiency improve company"s performance

To ascertain if there exist co-operation between internal auditors and external auditors.

To find out if auditing efficiency assists in the detection and prevention of fraud in the company.

1.4 Research Questions

Does auditing efficiency improve company"s performance?

Does co-operation exist between the internal auditor and external auditors?

Does auditing efficiency assist in the detection and prevention of pilferage and fraud?

1.5 Statement of Hypothesis

Hypothesis One

H0: There is no relationship between auditing efficiency and company"s performance.

H1: There is a relationship between auditing efficiency and company"s performance.

Hypothesis Two

H0: auditing efficiency does not assist in the defection and prevention of pilferage and fraud.

H1: auditing efficiency assist in the detection and prevention of pilferage and fraud.

1.6 Significance of Study

The significance of this study can be viewed into two major aspects practical and academics. Practically, this study therefore may be of a special important to the following interest groups who may find the research beneficial.

The management itself, who make the organization decision and policies.

The stockholders and other interested potential investor.

The general public who have right to be informed the activities of any such organization.

The financial analysis.

Academic significance

Students: This research will enable students who intend to study the course in future to make use of the work both in their academics and research programs (reference purposes).

Summary, Conclusion and Recommendation

5.1 Summary Findings

Based on the research carried out on the topic auditing efficiency for improving companies performance, the researcher discovered the following from the results of the questionnaire served and the hypotheses that:

There is a relationship between the auditing efficiency and company"s performance.

Auditing has an annual audit plan.

The annual audit plan is submitted to the organization.

Auditing efficiency report is not acted upon by management.

There is no co-operation between internal auditor and the external auditor.

Internal auditor assists the external auditor in his investigation.

There is cordial relationship between the internal auditor and the external auditor.

Auditing has up to date auditing efficiency manual.

Auditing shares information on auditing efficiency manual to the external auditor.

Auditing assists in the detection and prevention of pilferage and fraud.

The presence of an internal auditor acts as a check against fraud.

The employment of an external auditor does not assist in the fight against pilferage and fraud.

The fear of penalties helps in the check against fraud.

5.2 Conclusion

Based on the findings of our research work the researcher concluded that auditing efficiency indeed serves as a tool to management for Household Products Company and all organizations generally. Although some areas are still weak, with some effort the auditing efficiency can improve and carry out its objectives in the organization.
However, auditing has severed as checked against fraud and other activities of the staff which is one of the objectives of the auditing and the findings have revealed, is a tool to management not only in one but in all organizations because of its findings, objectives, the significance to organizations is general.

5.3 Recommendation

From the findings and problems discovered, the researcher will like to make the following recommendations.

The auditing unit of the organization should keep ethical standard by keeping up to date auditing manual and train its internal auditor in forensic accounting.

Auditing units should always draw annual audit plan which is the focus of the company as it will help them to have efficient operation.

The auditing unit of the organization should always submit their audit plan to the management who will have to be pro-active and take action according to findings of the plan.

The researcher recommended that the management on their part should acknowledge the report submitted to the management and allocate more power to the auditing efficiency to ensure independence.

The auditing unit should endeavor to carry out their audit work to other departments which is not often visited.

The internal auditor of the company should be subjected to ethical standard so that external auditor will not do the work of internal auditor or the work of an accountant so that cordial relationship should be maintained and external auditor may rely on the work carried out by the auditing efficiency of the company.

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