The practice of auditing has been existence even in the ancient time. The need for auditor arises when the truthfulness and fairness of financial statement is required. An Auditor is a person appointed by law to examine and investigate the accounting records prepared and maintained by organization are of true and fair view.
Before the medieval times, auditing was referred to as the process of public hearing in which financial statement of financial records were read aloud, Ekwere (1991). In essence, auditing was made to determine where persons in position of fiscal responsibilities in government or organizations were acting and reporting in good faith or in honest manner. But today, auditing has taken a new dimension in our society and it will continue to be improved upon as a result of expansion and growth of business in our contemporary society. According to the publication of American Accounting Association (AAA 1991),”Auditing is a systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between those assertions and establish criteria and communicate the result to interested users”. Adeniyi A.A. (2004.2) extracts his opinion that it is “an exercise whose objective is to enable auditors to express an opinion whether the financial statements give a true and fair view of the entity’s affairs at he period and of its profit and loss (income and expenditure) for the period ended and have been properly prepared in accordance with applicable frame work”.
However, the practice of auditing which has been in existence for years has no positive impact on the economy, there had been several corporate failures, which had been led to reduction in growth (ie depressed economy) in view of the above problem this research focused on the roles of auditors in a depressed economy.
        The establishment of internal audit in organization and financial constitutions was to reduce or remove completely the problems of fraud, to protect the company’s assets, and to check misappropriation and embezzlement of funds. But there have been and there is still problem of fraud, misappropriation and embezzlement of fraud in financial institutions.
(1)    To examine the role of internal auditors in financial institutions
(2)    To evaluate the usefulness of Internal Auditors to banks by providing reliable accounting information.
(3)    To access the impact of government financial policies and guidelines on the execution of Internal Audit function in financial institution (Banks).
(4)    To find out the importance of Internal Auditors in protection of company’s assets, misappropriation of funds and embezzlement of funds.
(5)    To make appropriate recommendations that will proffer sound solutions in the weakness of internal auditing functions in banks.
        The significance of this study can be viewed in many ways; it is intended to create awareness in the management of private and public companies, it is hope that firms will see internal auditors as those which has much to offer to the organization. Also this research recognizes the fact that depression in an economy will lead to macro economic instability and that probably auditors too have a role to play. It is hoped that this research will identify the various factors causing depression that had hitherto been in effectively controlled so that more attention can be paid to them.
The banking management would benefit because their problems will be addressed to a reasonable extent. It will be beneficial to investors, who might not be opportune to critically view some documents either because of lack of time, it will help them to know whether to invest in a particular bank or not. To policy makers and regulators in the banking industry, it will present a scheme, through its analysis can assist them in enunciation policies that will not only positively impact on banks but also to remain relevant in the economy by performing good function in Nigeria economy.
This study, when completed will serve as a reference point and source of secondary data for future researches in the field, it will give them an insight into the role of auditors in depressed economy like ours.
In order to facilitate this study the researcher will base this study on the following questions:
(a)    What is the role of an auditor?
(b)    How an auditor does perform this function his function to ensure efficiency in banking industry?
(c)    What are the things to be done to enhance good economy in banks and banking industry in general?
(d)    Does an auditor duly follow the laid down rules and regulation in auditing a firm?
(e)    Are the roles of auditor followed under normal circumstance?
(f)     Does an auditor play any vital role in Nigeria Economy?
(g)    How far is the economic situation, similar or contrasting in the banks.
A hypothesis is a tentative statement, which is subject to future proof. Based on this, the researcher has generated the following hypothesis that will be tested in the study.
Ho:1  Internal Audit Department in banking industry has not been able to play its role in the protection of the company’s  assets, misappropriation and embezzlement of funds.
H1:    Internal Audit Department has been able to play its role in the protection of the company’s assets, misappropriation and embezzlement of funds.
Ho2:  Internal Auditors do not adhere to statutory rules and regulations laid down for them in the course of doing their work.
H1:    Internal Auditors do adhere to statutory rules and regulations laid down for them in the course of doing their job.
Ho3:  Government policies, rules and regulations on financial matters does not affect the execution functions of internal audit department.
Hi:    Government policies, rules and regulation on financial matters affect the executive functions of internal audit department.
This research work involves both qualitative and comparative analysis of data, other information where obtained from both primary and secondary sources in form of past data and face to face interview.
The primary sources of data include information from questionnaires administered to staff of United Bank for Africa Plc, Intercontinental Bank Plc and Zenith Bank Plc. Secondary sources of data was gotten form various text books, magazine, journals, newspapers and periodical seminar papers.
The researcher decided to use random sampling method in the selection of sample size, to ensure that all members of the population has equal and unrestricted chance of being represented.
This study covers the cause of depression in an economy and the extent to which these causes are being addressed. The period under view is restricted to 11 years that is (1993-2004). This period is considered to be very important in the history of our country Nigeria because of a lot of crisis going on in Nigeria which has caused a lot of instability both socially, politically, and economically. During the period of writing this work. The researcher encountered limitations of time. Financial constraints also limits the scope of research work that can be embarked upon by the researcher.
Also the problem of resistance of some bankers who prefer not to comment, regards to some information as being vital and confidential therefore the researcher was deprived these information, because of this, the researcher could not carryout as much as detailed analysis as she wished.
In carrying out this study, there are certain words, which required the expression of their meaning.
AUDIT:     It consists of a searching investigation of the accounting records and other evidence supporting these financial statement.
AUDITING:      It is the independence examination of the financial statements of an organization with a view to express an opinion as to whether these statement give a true and fair view and comply with the relevant statues Aguolu (1998).
AUDITOR:                A person whose duty is to conscientiously and objectively examine and inquire into any statement of account and other documents where possible.
DEPRESSION:  Is a sever down-turn in economic activity that last for several years. Or feel of sadness that makes you to think there is no hope for the future.
FRAUD:    It involves theft, misappropriation or embezzlement of organization fund usually in form of cash or other assets.
STATUTARY AUDITORS:  These are audits carried out because the law requires them. Status, which requires audit includes CAC, the building society Act (1962, CAMA 1990)


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