Effect of Forensic Accounting on the Financial Performance of Commercial Banks on Nigeria

Abstract

The current study was on the effects of forensic accounting on the performance of commercial bank in Nigeria. Fraudulent activities in a commercial bank setting may have a negative effect on the viability, performance, sustainability and reputation of commercials banks.  This study was conducted through explanatory research design which required the analysis of how a set of independent variables affect the dependent variable.  The target populations comprised of all 609 forensic managers, their staff and internal control managers and their staff. For the purpose of this study, sampling frame of 21 commercial banks was taken.  A sample of 61 respondents was used which was spread proportionately across 6stratum. The stratum included Forensic Managers, Forensic Assistant Manager, Internal Audit Manager, Internal Audit assistant manager, forensic staff and internal audit staff. The study used primary data that was collected through self-administered questionnaires. The findings indicated that forensic investigation and forensic litigation was statistically significant in explaining changes in financial performance of commercial banks. The findings of this study were crucial in the formulating study conclusions. However, the study also took into account the expectations of the study. It was possible to conclude from the study findings that forensic investigation and forensic litigation were statistically significant in explaining changes in financial performance of commercial banks in Nigeria. It was also possible to conclude that use of forensic financial information influenced and improved performance of commercial banks in Nigeria.  The unique contribution of this paper is that it clearly addresses the effects of forensic accounting on the performance of commercial bank in Nigeria, upon which majority of commercial banks in a developing economy ought to adapt to mitigate financial irregularities.

Key Words: Forensic Accounting, financial performance, financial information