Effect of the Socio-economic Background of Students on Their Performance in Secondary School Certificate Examination (Economics)

Effect of the Socio-economic Background of Students on Their Performance in Secondary School Certificate Examination (Economics)


This research examined the Effect of Internal audits on Managerial Performance in Public enterprises. A survey design was employed with the use of a well-structured questionnaire. Respondents were selected based on a simple random sampling technique. Seventy (70) staff were selected from NNPC. Two hypotheses were formulated and data collected were tested with the use of Chi-Square analysis. Findings from the result show that Internal audit has a significant impact on the reduction of embezzlement in public enterprises and established control has a significant effect on managerial performance. The study recommends that internal auditors should continue to efficiently review various departmental functions to enhance effective accounting systems and control.




The term audit is derived from the Latin verb “Audire” which means “to hear”. The origin of audit dates from ancient times when the landowners allowed tenant farmers to work on their land whilst landowners themselves did not become involved in the business of farming. The landlords relied upon an overseer who listened to the accounts of stewardship given by the tenants during this period the word audit is described as:

The independent examination of, and expression of opinion on the financial statements of an enterprise by an appointed auditor in pursuance of that appointment and compliance with any relevant statutory obligation.

Furthermore, the introduction of the joint-stock company increased the supply of capital for industry and commerce. The small privately owned business, which was financed by a sole trader or a partnership gave way to the form of the organization now familiar as the limited company. The body of shareholders delegated some of their members to act as a board of directors, and periodically the board submitted accounts to the shareholders so that they could be aware of the state of affairs of the enterprise in which they had an interest. It was, therefore, necessary for the shareholders to satisfy the accounts presented by the directors did provide an objective view of the state of affairs of the company.

The joint-stock company Act of 1844 was the first legislation in Britain fore quire all incorporated businesses to hand their annual financial statements examined by an auditor. Early auditors were, in many cases non accountants who were required to state whether the accounts showed a `true and correct view of the state of affairs of the, it was the company’s Act 1900 that required auditors to be independent and it was not until the 1948 Companied Act that he was required to be professionally qualified. At this juncture, it was more appropriate to define audit as:

An exercise whose objective is to enable auditors to express an opinion on whether the financial statement gives a true and fair view (or equivalent) of the entity’s affairs at the period end and of its profit and loss (or income and expenditure) for the period then ended and have been properly prepared by the applicable reporting framework (for example relevant legislation and applicable accounting standards) or where statutory or other specific requirement prescribed the term, whether the financial statements “present fairly”.


Internal audits are those audits that are being carried out by employees within an enterprise. An internal audit is an independent appraisal function established by the management of an organization for the review of the internal control system as a service, to the organization. It objectively examines, evaluates, and reports on the adequacy of internal control as a contribution to the proper economic efficiency and effective use of resources.

The Institute of Internal Auditors (IIA), the professional body of internal auditors, defines the function in the following way. “Internal auditing is an impendent appraisal activity within the organization, for the review of operations as a service to management. It is a management control which functions by measuring and evaluating the effectiveness of the controls”.

The scope of the internal audit within an organization is broad and may involve topics such as the efficacy of operations, their liability for financial reporting and investigating fraud, and safeguarding assets in compliance with laws and regulations.


By definition, internal control is an independent appraisal function within an organization, carried out by employees of the organization, for the review of operations (financial and otherwise): as a service to management. It is a management control that functions, by measuring and evaluating the effectiveness of other controls. Fraud or irregularities, which arise in the conduct of the affairs of a company, maybe classified broadly into:

Defalcations involving the misappropriation of money or goods, such acts may be performed by an individual or group of individuals without the knowledge of the board of directors, or sometimes, by the board to defraud the member.

Fraudulent manipulation of, financial statements not involving defalcation. The main reasons for this are:

To attempt to improve the apparent position of the company e.g to justify a dividend that would not otherwise have been payable or assist in raising new finance: or To attempt to defraud the tax authorities by reducing taxable profits.

The internal auditors should continuously review the existing controls to ensure that they are followed and update them when need be. This shall ensure that the occurrence of fraud is prevented and that when any such ‘frauds occur, they are easily and timely identified and reported to management. He must search for fraud, to examine the books, accounts, and control/processes/system to discover whether there have been defalcations or other irregularities by directors or employees of the company. However, if the directors of the company decide to defraud the members, there is not much the internal auditor can do. Being a staff of the organization, he probable reports to the directors and depends on the board for his remunerations, promotion, and other employee incentives.

Similarly, where the management .of a business wishes to manipulate the misleading impression without actually diverting any of the business assets, the internal auditors cannot do much as management misstates the assets or liabilities. While the more common target for manipulations is stock, other areas are also susceptible.

financial statements to give It is painful to observe that in practice, members in the employment of companies as accountants, finance controllers, internal auditors, etc are used to, enhance and perpetuate these management/ directors aided fraud. Members must always beings to bear on all activities they are carrying out for clients and employees the institute’s codes of professional conduct and ethics.

Misappropriation of cash may result from the making of fictitious payments or the diversion of cash receivable. The number of ways in which these may be done depends on the systems of control in existence and the ingenuity of the person or persons involved. In many cases, it is the attempt to cover up rather than the original theft that is detected. So prevention of fraud is a continuous review of controls and operations. The opportunities for fraud will depend on the system of controls. Particularly, important are those leading to segregation of duties. Although frauds involving collusion are not uncommon, it is generally agreed that the chance of detection rises with the number of people involved.


Even though there are installed control and checks of resources, embezzlement, fraud of resources misappropriating of funds, errors, irregularities, and mistakes stills find their way into the public enterprises.

The internal audit department was established to reduce those excesses, however, in Nigeria’s public enterprises this is not so, as there are a series of the problem which has hindered the internal audit efficiency.


The broad objective of this is to examine the effect of internal audits on managerial performances in the public enterprise (NNPC). However, some of the specific objectives are as follows:

· To identify the factors that hinder audit efficiency in NNPC as a public enterprise.

· Reduce excesses of the internal auditing department of NNPC Identifying problems and accountability in NNPC.

· Examine the factors that hinder internal audit efficiency and how these factors impinge. It is also shaping up the performance of management


The role of the internal audit department is called upon to play especially in public enterprises and the ignorance of the employees makes this study important With a sound internal audit, management that is characterized by fraud, errors, irregularities, and mistakes in the public enterprises which has resulted by the notion that government business is not supposed to make a profit is bound to be eliminated.

The management, employers, employees, as well as students, benefit from this study.


Below are some questions that would be answered during this research work.

· What is the impact of internal audits on the performance in the public sector

· Does establishing control failed to enhance management performance in Nigeria’s public enterprise (NNPC)

· Is there any factors that determine the performance of the management in NNPC

· Does effective internal audit enhance the reduction of fraud?

· Is there any factor that prevents; internal audit from being effective and efficient in NNPC?


To ensure a mere analytical result-oriented research, hypotheses are formulated and tested on the research objectives.

The decision criteria are to accept the null hypothesis (Ho) and reject the alternative hypothesis (Hi) or otherwise based on the result of the test performed. The research hypotheses are stated below:

Hypothesis 1

HO: Internal audit has no significant impact on the reduction of embezzlement in public enterprises

Hi: Internal audit has a significant’ impact on the reduction of embezzlement in public enterprises

Hypothesis 2

HO: Established control has no significant effect on managerial performance.

Hi: Established control has a significant effect on managerial performance.


The scope of limited to various measurements of internal audits which are used in public enterprises. The constraints to this study are time, adequate information, lack of enough literature on this subject arid information which is considered confidential was not revealed by some of the staff.

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