Al-Hikmah University Journal


Al-Hikmah University Central Journal

Our Academic Journal provides information on the latest emerging trends and developments in these ever-expanding subjects:.

EFFECT OF INTERNAL SYSTEM ON EMPLOYEE FRAUD IN MANUFACTURING COMPANIES IN ILORIN METROPOLIS

DAUDA Abdulrafiu: Department of Accounting, Faculty of Management Sciences, University of Ilorin, Kwara State, Nigeria; E-mail: dauda.a@unilorin.edu.ng YUNUS Abdulrasheed Bolaji: Department of Accounting, Faculty of Management Sciences, University of Ilorin, Kwara State Control, Nigeria; E-mail: yunus.ab@unilorin.edu.ng OLAOYE Clement Olatunji: Department of Accounting, Faculty of Management Sciences, Ekiti state University, Nigeria; E-mail: clement.olaoye@eksu.edu.ng HASSAN Abdul Olalekan:

Abstract

Fraud prevention has become an issue that some manufacturing companies find themselves faced with. Internal control is the tool which companies hope to adopt in combating employee fraud. The main objective of this study was to examine the impact of internal control system on employee fraud in manufacturing companies in Ilorin Metropolis. The ordered logit regression method was adopted in testing the viability of the hypotheses put forward. It was concluded that internal control has an impact on fraud prevention. Findings from the study showed that human resource policies, managerial accountability and management override of control all have a positive effect on fraud prevention in manufacturing companies in Ilorin Metropolis. It was recommended that the human resource (HR) department should follow due process when hiring, promoting and compensating staff and that internal control guideline should be based on principles instead of laws.

Keywords: Fraud, Management, Companies and Managerial Accountability
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