The principle of this study is to investigate the impact of Auditors report on- fraud prevention and control. Early Auditors were in many cases, Non-accountant who were required to state whether the account showed a “true and fair” view of the state of affairs of the company. The shareholder and other investor relied on auditors report as the late authenticates the completeness, accuracy and validity of the financial statement of the organization. In order to make the owners of the business place reliance on members of the management as regards the true and fair view of the financial statement, the shareholders will appoint an .auditor. This study has been undertake to identifies, analysis and examines the problems encountered in financial institutions by both external and internal auditors, this research work also examine the auditors report in fraud prevention and control in Guaranty Trust Bank Plc Ogui Road, Enugu Branch. The information obtained from this study indicates that Banks undertakes various internal control measures to prevent and control fraud. This study further identified some of the measures adopted by the bank in the aspect. Cheaper one of this study is an introduction to the topic of the research, objectives of the study and research question which forms the basics of this research were succinctly illustrated. Chapter two also is a critical and decisive review of this study. Moreover, the approach adopted in this study is the use of survey questionnaires and oral interview for the collection of data relating to the hypothesis designed. The hypotheses were statically tested at the 5% level of significance using the no-parametric chi-square and percentage. The hypothesis were also tested to guide the research work in order to arrive at a conclusion. Chapter five offer the researcher. The chance to summarize entirely on the research work, making recommendation based on the conclusion arrived from the analyzed data.




Banks and financial Institutions are the most acceptable versatile, delicate .and popular forms of the present day joint increased capital base and insurance cover has necessitated the demand for more capital . which in must cases has been achieved through issue of shares and subsequently pooling other people’s money in agreement for repayment in terms of loans and other credit facilities and periodic dividends for common stocks and shares.

The current day Banks which are now public liability companies have been built on trust, confidence and security of deposits. Right from its inception when the deposit were made in kinds such as gold bars, platinum’s and other valuables whose supposed ready availability gave security to the owners who have deposited them for safe keeping. With the improvement in mode of operation, culture and structure one thing has remained unchanged which is confidence (security). Banks has continued to structure their services with a view to provide customer satisfaction which is built on the foundation of security and trust.

Banks and financial institution trade and provide these services of security and trust with other people’ s money not their own money because they do not mint money. Therefore, it would only amount to misappropriation of fraud, if these services are not rendered with these funds but something of a more private and adverse nature is accomplished with the funds. The effects of ·these actions (if they are allowed to hatch) have precipitated the regulatory boards to mandate banks to publish audited accounts of their periodic activities for analysis. We should stress clearly that it is the need to forestall, bar and check the incidence of misappropriation that is the regulatory authorities insisted that accounts must be audited and published.

The joint stock company at of 1844 was the first legislation in Great Britain to require all incorporated business to have their annual financial statement examined by an auditor.

Early Auditors are requiring to state whether the accounts owed a true and a fair view of the state of affairs of the company. It was the companies act of 1990 that required the auditor to be professionally qualified (chartered/certified public (accountants) in this case the owner of a business are separated from the administrators of the’ business, there exists a relationship called stewardship and the reports as regards the state of affairs of the business within corresponding period of operation is as stewardship Accounting. When stewardship accounts are presented, the owners (shareholders) of a business are perplexed whether the managers/administrators are being honest in their reports or not. In this vein the owners who have to employ an independent skilled individual known as an auditor to carry out an appraisal or investigation and express an opinion as to whether the accounts present a true and fair view of the state of affairs of the business. Various cases of fraud and misappropriation in sectors of the economy especially amongst public liability companies have called for an appraisal as to the efficiency of audit exercise in fraud prevention and control.


Owners of a business organization need an account of stewardship from the person whom they have entrusted their business to, so as to know whether the business is making and yielding adequate returns, but the owners do not know to what extent the managers are presenting reports as to its fairness. So the owner will require the services of auditors to tell them whether the reports provided by the stewards (managers) present a true and a fair view of the state of affairs as regards the business entrusted in their care.

The Enron Saga put the following doubts in the mind of stakeholders of a business.

    i.        To what extent do Auditors reports ascertain whether financial statements presented to them, show true and fair view.

  ii.        Do Auditors reports prevent fraud and financial crimes or do their reports assist them (fraud and financial crimes).

Other may be more specific in their requires and may demand what roles auditors or auditors report play in the prevention and control of fraud.


The objectives of this study IS to deeply analyse the ‘contribution of auditors or their reports in prevention and control of fraud and financial crimes and to what extent have they been successful in fraud prevention and control.

i.            To ascertain and establish the relevance of auditors report in an organizational control process.

ii.          To ascertain how in1ernal control process can be strengthen to limit the incidence of fraud, effectively


i.        Do the role of Auditor report on fraud prevention and control appreciate?

ii.        Do auditors have adequate authority to perform their duties?

iii.        Is it the duty of an Auditor to state whether micro financial statements are in compliance with statutory end professional requirement?


Hypothesis I

Ho: The role of Auditors reports in fraud prevention and control does not appreciate.

Hi: The role of Auditors reports in fraud prevention and control appreciates.

Hypothesis II

Ho: Auditors do not have adequate authority to perform their duties.

Hi: Auditors have adequate authority to perform their duties.

Hypothesis III

Ho: The Auditor does not state whether financial statement are in compliance with statutory requirements.

Hi: The Auditor states whether financial statements are in compliance with statutory and regulatory requirement.


Fraud deterrence, prevention and control are the three interwoven elements that an effective internal control system should boost of. With the wide spread incidence of fraud. This study will feasibly provide measures that can be taken by public and private organization to design a sound internal control system aimed at fraud prevention and control.

The study will also establish the place and importance of auditors in ensuring a strong and reliable control system for business organization.


The geographical area of coverage for this piece of work is e Guaranty Trust Bank Plc Ogui Road Enugu and as a consequence. all data in use for these research works are directly related to the bank and were provided by the bank to the best of the researcher, due to financial constraint had to limit her investigation to one bank branch, so as to make due with the little :money she had more thoroughly.

Secondly, the information supplied were laced with limitation of discretion, so as not to reveal, potentially the skeletons of the banks thereby losing their job as a consequence.

Historical background of a firm studied

Guaranty Trust Bank Plc was incorporated as a, limited licensed to provide commercial and other banking services to the Nigerian Public if’) 1990. This bank commenced operation in February 1991 and has since then to become one of the most respected and service banks in Nigeria.

In five years later, in September 1996, Guaranty Trust Bank plc became a publicity quoted’ company and won the, Nigeria exchange presidential merit award that same year and subsequently in the years 2000, 2003, 2005, 2006, 2007 and 2008. In February 2002, the Bank was granted a universal banking license and later appointed a settlement bank by the Central Bank of

Guaranty Trust Bank Plc is the third biggest banks in Nigeria based in Victoria Island Lagos and in 2004 the bank undertook its second share offering in 2004 and successfully raised over N11 billion from Nigerian investors to expand it operations and favourably compete with other global financial institutions.

According to Aderinokun (2009) Today the situation has changed tremendously with the state of the updated equipment place, many headed office department including wide area Network. Data communication and advance technology which are not only responsive but enable the bank to maintain in competitive position including United Kingdom.

In 2007, the bank is been awarded winner in three categories. 2007 most customer friendly bank, 2007 bank of the car and 2007 best bank in corporate Governance. More recently, the bank clinched the kpmg 2009 most socially responsible bank in Nigeria at the social enterprise reports and awards. The bank also win the best lot support bank of the year awards at the year 2009 National ICT merit awards while its CEO, Tayo Aderinokun was named the African banker of the year by this day News paper and sun man of the year in 2009.


Accounting: This is the process which deals with measurement d involves the collection, classification and presentation of formation in money terms on economic activities in the form of transaction and the communication of the information in appropriate form to internal and external users.

Administration: This is seen as a science which studies group activities, directed towards the achievement of stated objectives Auditors: It is a firm of professional accountant all parties one or are of whom is responsible for the control of the audit and designing of the audit report on behalf of the firm.

Finance: This is primary concerned with money and money matter.

Fraud: According to Webster’s New World Dictionary. It is the international deception to cause a person to give up property or some lawful right. The Federal Bureau of investigation defined fraud as the fraudulent conversation and obtaining of money or property by false pretense, included are larcenies by bad checks except forgeries and counterfeiting.

Information: This is data that has been processed into a particular form that is meaningful to the receipts and which is real or has perceived valve for decision making.

Limitation: This is constrains that one will undergo in carrying out a particular project.

Management: As people comprise those who guide actions in organization towards the achievement of the ends or goals for which the organization is established.

Organization: This is a combination of people or individual effects, working together in pursuit of certain common purpose called organization goals.

Scope of study: This means the extent or boundary covered by the researcher, that is the geographical area covered.