CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Fraud is an act of deception intended for personal gain or loss to another party. Fraud as a crime embraces all the multifarious means which a human ingenuity can device which are resorted to by an individual to get an advantage over another by false representation. This means that fraud can be perpetrated in the course of personal relationship in religious organizations, social clubs etc. Seetharaman, Sentivelmurugan & Periyananyagam (2004). Fraud causes tremendous loss to the business world and creates morale problems in the work place. When we are stripped of our money by fraudulent means the consequences can be devastating. Fraud losses are serious problems to organizations that need to be managed, controlled and monitored.
The Association of Certified Fraud Examination (ACFE) identifies three main categories of fraud that affects organizations; the first of these is asset misappropriations, which involves the theft or misuse of an organizations asset. Examples include theft of inventory or cash, false invoicing, accounts receivable fraud and payroll fraud. The second category of fraud is fraudulent financial statements which are the most costly with median loss of $2million among the 99 financial misstatements included in the 2008 ACFE study. The final of the three fraud categories and most common is corruption occurring in 27 percent of all fraud cases (AICPA, 2009). Corruption includes activities such as the use of bribes or acceptance of ‘’Kickbacks” improper use of confidential information, conflicts of interest and collusive tendering. Fraud has been cited as Nigeria‘s biggest single problem both in public and private sectors. It has not only snapped public trust in government but it has cost the government and people of Nigeria billions, due to corrupt management of public companies unrealized public projects and deteriorated infrastructure caused by looted maintenance budget. It is against this background that the researcher intends to analyze the issue of fraud and strategies to manage it. The research therefore seek to investigate the Fraud detection and control in payroll department in UYO LGA