Abstract
This research work examines the influence of statutory audit on SMEs growth and survival in Nigeria. Audit plays a significant role in growth and survival of small scale business. The research deals with the problems auditors encountered during the audit of small scale business to enable them ascertain that their statement of affairs shows a true and fair view. Questionnaires, personal and oral interview were used to collect data. The data collected through the research tools were analyzed using percentage and chi-square (X2) were used to test the hypotheses. The result reveals that some small scale business do not keep good accounting or records of transaction. The study concludes that small scale business can do well if their accounting system is streamlined to meet the standard accounting system procedures and practice. Based on the findings, the study recommends amongst others that the government should encourage these small scale businesses by giving them reasonable amount of years when they will not be required to pay tax.
CHAPTER ONE
INTRODUCTION
1.1 Background to the Study
Auditing, as it exist today was established as a result of the separation of ownership from the control of business. The owners entrusted their business to managers and the owners are then presented with a stewardship accounting. This stewardship
accounting is usually done by means of financial statement. The financial statement is in form of profit and loss account and the balance sheet of the business.
In these circumstances, the need arise for some means by which the accounts presented to them by their managers can be relied upon of error in advertently made.
It was for this reason therefore that the practiced is to verify on behalf of the owners. Obviously it is impracticable and impossible for the owner of business to examine the books and records of the business. The owner appoint auditor to act for them. Auditing is an examination by an independent expert i.e. the auditor to act for them. Auditing is an examination by an independent expert i.e. the auditor of a set of financial statements and of the underlying books and records which result in the auditors providing an opinion on the financial statement.
Auditors concerned themselves primarily with the proof of accuracy of Client’s records, utilizing evidence available within the confines of the business. The subsequent growth of the demand for reliable financial information by third parties supplying credit or capital to expand enterprises, auditors turned to the examination of financial statement. Here the external evidence to corroborate company figure increased in importance is still important auditors recognize that the accounting system that produces the financial and operating information to be reported is a key factor in the accuracy andreliability of the results.
This research work examines the auditing of small scale business, problems and prospects with. This became relevant because small scale industry is a catalyst towards economic growth in developing countries such as Nigeria.