Abstract
This study aims at exploring the role of an accountant in curbing corruption in Nigeria. The objective of the research work seeks to explore the role an accountant can play in the fight against corruption by applying his investigative skills, providing litigation support service and documentation and reporting. The population used in the research was the University College Hospital (UCH). The research design employed was the survey research. Data were majorly collected from primary sources. The hypothesis testing in this research work was done using Chi-Square. The results of the empirical findings show that accountants are relevant in investigating crime and corruption in Nigeria. Accountants play a role in litigation support services in Nigeria, and accountants are relevant in documentation and reporting. It was observed that accountants play a significant role in curbing crime and corrupt practices in any public sector since they provide a mechanism to hold people accountable, such
CHAPTER ONE
1.1 INTRODUCTION
Nigeria became an independent nation on the 1st October 1960 a country richly endowed with monumental geographical and diverse natural resources ranging from crude oil to gas Nigeria possesses potential market ability for rapid economic development. However, in spite of these obvious resources and its advantage, Nigeria remains a poor and underdeveloped country. Scholars have achieved and advanced several reasons to explain this parlous and depleting state. One of the major and prominent factors advanced is corruption.
Corruption has been a major problem in Nigeria since independence, numerous state institutions have become dysfunctional because of large-scale corrupt practices, Projects are routinely abandoned, and no one is brought to book, public goods and resources are diverted to private ends.
Corruption endangers the good governance and the democracy we see today, Corruption was cited as one of the more prominent reasons for Nigeria’s first military coup by the coups of January 15th, 1966 military putsch, Massive corruption and resources brigandage also were cited as reasons for the military takes over by the regime of Buhari and Tunde Idiagbon on December 31st, 1983.No society can achieve its full potentials if allows corruption to become a full-blown cancer as it has become in our nation.
1.2 BACKGROUND TO THE STUDY
Corruption is a global phenomenon. It occurs in both the developed and the developing countries of the world. The difference however is that in the developed countries, it does not obstruct the normal functioning of state and social system in the same way, because there are established ways of dealing with the problem. Corruption is however of special concern in developing countries. In the countries where poverty is widespread, those who pay and receive bribes further expropriate the nation’s wealth leaving little for its poorest citizens. In such situations where corruption is systemic, even countries with extensive natural resources may fail to develop in a way that benefits the ordinary citizen.
According to Michael (1997: 69-90) corruption is of a symptom of deeper difficulties in the society where it is prevalent and usually operates within the broader context of other social problems. Thus, corruption is associated with slow economic growth, reduced investment feeble property and contract right, effective institution, limited social interaction and weak rule of law, poor economic competitiveness, deep ethnic division and conflicts. Low popular participation in polities of civil liberty, low educational attainment, and closed economic and political systems. In other words, corruption is pervasive in underdeveloped societies and there is hardly effective means of combating the cankerworm. In Nigeria, corruption is a pervasive phenomenon; corrupt practices have become synonymous with governance and consequently, have become the bane of Nigerian society. According to Ake (1976: 3), the widespread corruption of public officials could be attributed to the economic weakness of the Nigeria ruling class, as fact that he in turn attributes to the colonial experience and to the dependence of the Nigeria economy on international capitalism.
Corruption is not a recent phenomenon in Nigeria society. As noted by Ayose (2005: 87). On February 26, 1952 during the dying days of colonialism, the Emir of Gwandu moved a motion in the Northern House of Chief. “That this house agreeing that bribery and corruption are widely prevalent in all walks of life, he recommends that Native authorities should make every effort to trace and punish offenders with strict impartiality and to educate public opinion against bribery and corruptionâ€Â.
Indeed, the first anti-corruption war was launched by General Murtala Muhammed on 16th September 1975. He set up a three-man panel to investigate and examine all the assets of certain former officers to ensure that such officer have not abused their office in the acquisition of such assets. This led to the retirement of many senior public officials and the much talk about mass purge. His regime that initiated the making of the 1979 constitution provided for a code of conduct for public officers, a code of conduct Bureau for the enforcement of the prescribed behaviour and a code of conduct tribunal. The Second Republic (1979 – 1983) the Shagari administration launched an anti-corruption programme Christened ethical Revolution and even appointed a minister of cabinet rank for national guidance following his lamentation about the state of corruption in Nigeria. This was to raise awareness and hopefully change deviant behaviour into conforming one. In spite of this however, one of the reasons why his government was toppled was because of its weakness in controlling corruption. The Buhari / Idiagbon regime (1983 – 1985) the regime launch an anti-corruption programme called “war against indisciplineâ€Â. The government exhibited seriousness to fight fraud, corruption, abuse of public office or graft and other similar vices. The regime matched is pronouncement with action by not only promulgating draconian legislation to control and prevent corrupt practices but brought to book people considered to have been fraudulent of corruption.
Above all, the present administration of Muhammad Buhari has also adopted the Economic and Financial Crimes Commission as one of the Commissions of combating corruption. From the foregoing analysis, it is demonstrated that corruption is indeed a frightening problem in Nigeria. It pervades every segment of the national atmosphere and has overwhelmed all levels and branches of government, it undermines the goals of development, public funds are often arbitrarily handled, use for private purposes or deposited in personal account including fattening of foreign bank account. Consequently, government and social economic conditions have badly deteriorated. The crime of corruption has always been viewed with particular distaste. It is no coincidence that the word itself is also used in the phrase ‘corruption of the flesh’, to indicate decay, death and malodorous happenings. It is often coined alongside the word bribery, that is, the means by which officials are induced to become corrupt,†wrote Peter Johnston, former Chief Executive of the Scottish Institute of Chartered Accountants. Olajide F (2000) notes that there is an alarming increase in the number of fraud and fraudulent activities in Nigeria, requiring the visibility of accounting services. Therefore, many foreign investors have lost several billions of dollars to fraudsters thereby leading to reduction or even dis-investment from Nigeria and its attendant negative consequences on economic growth and development. Appropriate legislation was enacted to criminalize all corrupt conducts including unjust enrichment. Key institution like Independence Corrupt Practices Commission (ICPC), Economic and Financial Crime Commission (EFCC) were established to fight corruption.
Corruption is a term with many meanings, but generally, it entails misusing one’s office for a private gain or unofficial end. It involves both monetary and non-monetary benefit. Bribery, extortion, influence peddling, nepotism, frauds, ‘grease money’, and opportunism readily spring to mind. Accounting unit serve as means of curbing corruption in Nigeria economy. According to Waziri (2009), corruption afflicts virtually all parts of Nigeria society. It has eaten deep into Nigeria value system and is now threatening to spread to the culture as public adulation for wealth has increased. In this age of high technology, fraud investigators can no longer be satisfied with just mere mouth but with accounting skills and treated by accountants with extensive knowledge of accounting information (Bressler, 2006; Manning, 2005; Ramswamy, 2005).1.3 STATEMENT OF THE PROBLEM
One of the pertinent issues in Nigeria today is the focus on one of the greatest impediment to good governance and sustainable development. In recent times, corruption has an issue taken the front burner in development discourse worldwide since 1996; the World Bank has supported more than six hundred (600) anti-corruption programmes and governance initiative developed by its member countries.
Ironically, the global financial body was embroiled in scandalous dealings that led to the removal of its chairman.
ï‚· Accountability is typically weak in Nigeria because the country is ripe for corruption and rife with it
ï‚· The motivation to earn extra income is extremely strong, worsened by poverty, low and declining civil services
ï‚· Thus, corruption has become a cankerworm in the political system, stifling it of its potential sustainable growth.1.4 OBJECTIVES OF THE STUDY
The major objective of this study is to examine the role of accountant in curbing corruption in Nigeria. Other specific objectives to be achieved are:
1. Ascertain the extent to which accounting department of the organisation is being used as a financial tool for measuring organisational performances.
2. Analyse the completeness of accounting records being kept by accounting department for economic and financial decision making
3. Identify the duties and responsibilities of an accountant in the organisation
4. Determine the effectiveness of accounting department in curbing corruption in organisation
5. Ascertain the relationship between incidence of fraud and investor loss of confidence in organisation.1.5 RESEARCH QUESTIONS
According to Gire, (1999) the rate at which corruption has grown in Nigeria is such that it looks as if it has been legalized. The studies on corruption conducted by the Transparency International in 1996 placed Nigeria as the most corrupt nation with Pakistan placing second from the rear out of 54 nations used in the study (Moore, 1997) As at year 2012, Nigeria was still among the ten most corrupt countries in the world (Obayelu, 2007)
The aim of this research is to appraise role of accountants in curbing corruption in the society
i. What is the effect of corruption on Nigeria’s development?
ii. Can accountant’s contribution curb corruption?
iii. Does corruption affect the economic and political efforts in Nigeria?1.6 STATEMENT OF THE HYPOTHESES
The following hypotheses have been formulated to serve as a base for this research:
Hypothesis 1
Ho: The level of corruption in the Nigeria polity is not a function of bad governance and corrupt individuals.
Hypothesis 2
Ho: The accounting firm is not capable of fighting corruption in Nigeria.
Hypothesis 3
Ho: The use of accounting information has not enhanced society in dealing with the problem of corruption.1.7 SIGNIFICANCE OF THE STUDY
Accounting department of any corporate financial organisation are sometimes deeply implicated in the global financial crisis of any country, due to their inability to carry out financial transaction with due diligence, transparency and compliance with stated accounting guidelines and regulation that in turn create rooms for criminal and fraudulent activities such as money laundering, tax evasion, and others.
Accounting is increasingly seen as a social phenomenon rather than pure technical phenomenon as it is implicated in both organisational and social context (Hopwood, 1985) following this notion, this study is motivated by the desire to understand the potential role of accountant in corporate financial institution.
The significance of the study will go a long way to enlighten all people in managerial groups on the importance of accounting information. That is, seeing accounting tools, as something that cannot be avoided is the bedrock of management in taking decisions.
The Beneficiaries
ï‚· Shareholders: This study will be important and beneficial to the shareholders who are interested in their capital investment
ï‚· The Government: Who really have interest in the profit to help them determine task and other policies
ï‚· The Managers: This study guides the managers to determine the profitability of a business concern
ï‚· The Tax Authorities: It enlightens the tax authorities and gives them the direction on how to use accounting information for tax assessment
ï‚· Public: The study shows the income and expenditure of a particular industry to the public
ï‚· Financial Analyst: This study will help the financial analyst to provide a means by which the finances of a business is controlled, to provide permanent records for all transactions, and to know the assets and liabilities of the industry.
In addition, it makes some people to work directly in the field of accounting and to create awareness of how accounting information works effectively and efficiently1.8 JUSTIFICATION OF THE STUDY
The researcher now finds out that modern accountant and accounting firm is therefore concerned not only with record keeping but also with focuses on the ultimate needs of those who use accounting information, whether the users are inside or outside the business itself, so accounting is not an end in itself. Instead, an information system measures, process and communicates financial information about an identifiable economic entity. The study intends to examine how accounting information helps management, societies, institutions and others to curb corruptions, takes decisions as regards the profitability of its products and maintain a corrupt free economy.1.9 SCOPE OF THE STUDY
Conceptually the study covers the implicit role accountants play as far as corporate financial organisations are concerned in Nigeria. However, the research was limited to U.C.H in Ibadan due to the schedule of the researcher.1.9 DEFINITION OF TERMS
i. Accounting Department: These are special section of the organisation which provide services and run by experienced accountants, like individual accountants, accounting department can specialise in different areas of accounting such as business start-ups or liquidations.
ii. Financial Accountant: The role of a financial accountant is to record, summarise and report all the financial transactions of an organisation in such a way that it is possible for someone outside the organisation to get an accurate picture of the organisation’s position and performance.
iii. Internal Auditor: Evaluate and report the efficiency and effectiveness of the activities, processes and procedures within an organisation. They involve in compliance, risk management and corporate governance
iv. Management Accountant: Assist in strategic planning by providing accurate and timely financial and non-financial information to the managers and key decision-makers within an organisation.
v. Accountant: An accountant is any person who possesses a professional license to practise accountancy from a recognized professional body and has legal capacity and authority to carry out the duties of accountants in taxation and audit practice.
vi. Accountancy: Accountancy is the composite activity of collecting, analysing, recording, summarizing, reporting and interpreting the true financial position or transaction of any organisation or government unit.
vii. Financial Report: is a formal record of the financial activities of a business, position, or other entity. It also provides information regarding the position
viii. Fraud: This refers to a wrongful or criminal deception intended to result in financial or personal gain. That is, an act or course of deception, omission or perversion of truth in order to gain unlawful or unfair advantage
ix. Corruption: According to section 2 of I.C.P.C Act (2000), corruption simply connotes impropriety and encompasses all forms of reprehensible, indecorous and infamous conduct in the performance of some official and non-officials’ responsibilities. This means any act, which go out of any normal societal behaviour.