CHALLENGES OF INTERNAL AUDIT FUNCTION IN THE NIGERIAN PUBLIC SECTOR A CASE STUDY OF KADUNA STATE MINISTRY OF FINANCE

ABSTRACT

This research work deals with the challenges of internal audit function in the Nigerian public sector with reference to Kaduna state ministry of finance. Internal auditing is a process generally adopted towards ensuring and safeguarding of resources and promoting operational efficiency in organization. The objective of this study has been to evaluate the internal control system in the Nigerian public sectors, to ascertain the non- implementation of routine audit report and the lack of proper segregation and assignment of duties. In recent times, a combination of forces has led to a quiet revolution in the profession. 
Government moving towards democracy must demonstrate accountability in the use of public money and efficiency in the delivery of service. In many cases internal control system are weak, staffs are poorly paid making them unmotivated, coupled with non-implementation of routine audit report by appropriate authorities. The Responses from staffs were analyzed using relevant statistical tools from which three hypothesis were formulated and tested using Z-test statistics, while questionnaire were analyzed in tabular form using simple percentage. It was discovered that the internal audit is facing a lot of challenges which includes inadequate staffing, lack of independence, lack of facilities to carry out audit function and also poor funding. 
As a result of some of these challenges the effectiveness of the internal audit in the Nigerian public sectors, has been hindered as well as the organizational change it can bring to its environment. I recommend that for internal audit to be effective, it must be a completely independent group, adequately funded and equipped with qualified internal auditors as well as sufficient opportunities for internal auditors to become qualified.

CHAPTER ONE
 
 

INTRODUCTION
 
 
The Kaduna state ministry of finance started when the country was pre-independent in 1958 during the northern region, the ministry of finance is the custodian of public fund and stores and is therefore essentially a controlling ministry as opposed to other executing agencies of the government. The ministry is headed by a commissioner as the chief executive officer and deputized by the permanent secretary who is a carrier and servant and is the chief officer of 145 staff including accounting officers on monthly basis. The ministry consists of three (3) major departments and seven (7) sub-treasuries.
 
1. Administration and finance which further sub-divided into stores and verification division.
 
2. Treasury which is further sub-divided into final accounts and debts management and ministry of finance Incorporated division and sub-treasury.
 
3. Internal audit (state)
 
1. ADMINISTRATION AND FINANCE DEPARTMENT.
 
 
The department is headed by the director and is responsible for the general administration of the ministry which includes maintenance of staff records, processing of staff promotion, recruitment training discipline and welfare etc.
 
 
 
STORES AND VERIFICATION DIVISION.
 
 
This division is headed by the chief stores officer who is charged with the responsibility of purchasing and disturbing of office equipment’s the ministry of finance is in custody of the public funds and stores, and is therefore a protective clothing to all government ministries and department and boarding of unserviceable equipment/ vehicles.
 
 
2. TREASURY DEPARTMENT
 
This department is headed by the accountant general and is charged with the responsibility of keeping receipt of government funds banking and maintenance of bank accounts, disbursement of all approved fund released, bank reconciliation, control of treasury documents and control of pooled accounting staff of the state.
 
 
MINISTRY OF FINANCE INCRPORATED (MOFI) DIVISION
 
This division is headed by the deputy director and is responsible for revenue collection management. Appraisal of investment opportunity for government,
management, of investment of government companies and ensuring the receipts of dividend and other funds due to government.
 
 
FINAL ACCOUNT AND DEBT MANAGEMENT DIVISION
 
The division is headed by the deputy director and is responsible for the collection and accounting data from ministry department, analysis of accountant-general’s reports, maintenance of external internal loan records and supervision of the state computer center.
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