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Study Level: BTech, BSc, BEng, BA, HND, ND or NCE
- BACKGROUND OF THE STUDY
Internal control can be defined as a whole system of the control financial and otherwise, established by the management of an organization in order to carry out the business of the enterprises orderly and the efficient manner. its main objective is to ensure adherence to the management polices, safeguard its asset and to make sure the record of the organization is complete and secured.
An auditor is defined as a competent and impertial critic appointed to verify the financial other accounting statement of the organization.
He must certify the statement exhibit a true and fair in view of the state of the affairs of the organization concerned.
However, he is not concerned with the financial strength of the organization but is task is to see the financial strenght as showed in the balance sheet is infact the actual and the true value of the organization.
Moreover, auditing can be defined as an independent examination of the expression of an appointed in the financial statement of an enterprise by an appointed auditor in pursuance of that appointment and in compliance with any relevant statutory obligation.
The internal control statement to be evaluated should be divided into components in order to give room for major segment to be examined and analyzed.
- STATEMENT OF THE PROBLEM
Internel control system, however elaborate can not by itself guantee on the efficient administration and the completeness and the accuracy of the record.
As a matter of fraud by any organization will always face in number if pushed of which the internal control system is expected to be adopted. Due to this fact most of the
Organization unit observe and always have auditor which could enable them to check their record often.
Although, having the auditor is very important to an organization, is relevant is only when they are able to carry out their task/work effectively in order to aid us in achieving the stated objectives and goals.
- Two or more dishonest person working his collusion can override the efficiency of the best possible control.
- Authorization control can be abuse by those whom the authority is vested.
- Management is in a position to take control of the set up by it.
- pressure exerted from the within and the outside. this enterprises can influence the integrity and the competence of the staff.
- Human error due to the error of judgment and the interpretation misunderfunding, carelessness or fatigue or distraction can underline the effective of the operation of the internal control.
Most of the problem stated alone with happen due to lack of an effective and the efficiency internal control system, these and many other problem have wreck many organization to split and may have also close down.
The liability of a business organization is when its be able to achieve the pre-determine objectives and denied its desires either the socially or economically.
- RESEARCH QUESTIONS
The following shall be the research question to address
- What is the extent to which internal control can be effective in the manufacturing company?
- Whether the internal control system applied work in the company or not.
- PURPOSE/ OBJECTIVE OF THE STUDY
The main objective of the study is to evaluate the effectiveness of the internal control system in the manufacturing company, other specific objectives of the study includes :
- To test as far as the scope permit, the accuracy and the completeness of the accounting record in the manufacturing industry.
- To determine the completeness accuracy and the validity of the company.
- To see how the company safeguard its asset by enforcing street adherence to the management policies.
- The purpose of the research work is to establish the effective internal control system in the organization under the study.The necessity of such role and why more organization should be devoting more resource towards the internal control system. This research work also aim at investigating and examining the system of the control in the organization under the study.
- The role of the internal audit in the attainment of the efficient and the effective internal control system is to be studies and it will be interesting to know that this is not be more checking of functional unit of the organization.
- SIGNIFICANCE OF THE STUDY
The research work is very important because it examines the internal control system of the organization and evaluate it with the overall performance of the company. The research should be able to identity its areas of strength and the weakness as regards the management of the company and hence its internal control system with a view of enhancing the recommended performance of the company.
- THE RESEARCH HYPOTHESIS
So as to ensure an empiracally tested research the following hypothesis shall be tested.
H0 : there is no relationship between internal control system and the effectiveness of the operation system in the manufacturing companies.
Hii : there is no relationship between the internal control system and the effectiveness of the operation system in the manufacturing companies
- SCOPE AND LIMITATION OF THE STUDY
The topic would have covered the whole of the manufacturing sector but due to the fact that the entire manufacturing company are under some legislation and the same module operand, the scope focused on some selected companies.
The research is also restricted to the effectiveness of the internal control system in the manufacturing sector with the specific emphasis on some selected companies.