The Narrowing Audit Expectation Gap, Fraud Detection Complexities and the Imperative of Forensic Accounting Practice in Nigeria

Abstract

This study examined the narrowing audit expectation gap and its implication on forensic accounting  practice in Nigeria. The study relied on relevant literature and  identified widening responsibility of  the auditor by the  professional audit standards and the Financial Reporting Council of Nigeria (FRCN) Act, 2011 on auditors’ responsibility for fraud detection and disclosure as factors contributing to the  narrowing audit expectation gap  while also positing   that this narrowing gap combined with the growing complexity and intractable nature of computer aided corporate frauds  and  financial crimes, have made traditional investigative skills of the  21^st century Nigerian auditors inadequate thus making it  imperative for them to ‘retool’ their skills in  forensic accounting. The study recommends a review of the accounting and auditing curricula of educational and professional bodies to incorporate forensic accounting, which should also be offered at post-graduate levels in Nigerian Universities. It also recommends that the Nigerian principal regulatory statute for corporate auditing and financial reporting , CAMA, be reviewed to make  for  a well articulated and  definitive  provision on auditors’ responsibility for fraud detection that will align with  the current position of  the international auditing  standards.

Keywords: Narrowing audit expectation gap; Forensic accounting practice; Traditional investigative skills;  corporate frauds; forensic accounting  methodology