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This study is on management of fraud and wastages in business organizations: implications for internal auditor. Many objectives were set among which are: to identify the nature, types and major causes of fraud and wastages. Two Hypothesis were also tested to determine if or not the hypotheses might be instrumental in fraud and wastages occurrences in business organizations. In arriving at the data used, both primary and secondary data were used. The primary data includes questionnaires distributed to sampled staffs and management of May and Baker Plc and Drugfield Specialty Product Plc. The secondary data includes materials form published textbooks, internet, articles and newspapers. These were tested using Z-test statistics. Data were analyzed and some of the findings include inadequate control measures took the most significant causes of fraud and wastages followed by deliberate intent and management ignorance. Finally, I recommended that proper internal control measure should be put in place, and other measures that will help to facilitate it like: inspection, review and observation. Trustworthiness, competence and integrity of employees and their understanding of prescribed policies and procedures.




At the beginning of the century, most businesses are small and sole-operated. The owners/managers are overly involved with most of the decision making. As business grows in size and complexity, professional managers take position of the owners and the operators.

Consequently, they rely heavily upon streams of accounting and statistical report which summarizes current happenings and conditionsin the enterprise. The information carried by these streams of report enables management   to   control   and   direct  the  enterprise                                          in order to assure management that the information received are both reliable and accurate. A system of internal audit is developed to monitor the activities of the company.

The need for maintaining the adequate efficient and effective internal audit, therefore cannot be overemphasized especially in days when Nigeria’s economy still is witnessing depression and every company is making effort in ensuring that wastage, waste, misappropriation are checked or avoided,  and to ensure that assets are beingsecured.

Some problems were noticed during the cause of this research; problemswithinthecompany,theseproblemsnecessitatethiswork.The


researcher noticed that there was ineffective co-operation between the internal audit and management, audit reports were sometimes ignored by the management. The relationship between the internal auditor and external auditor was strained making work harder for the external auditor. The lack of internal audit to prevent waste and fraud within the company thereby preventing an error free workingcondition.



Often, management and internal audit department function were seen as contradictory rather than complementary. Internal audit department is setup to ensure adherence to management policy but this objective cannot be achieved because of interference and undue influence by the top management.

More so, monthly or quarterly internal audit report as the case may be in an organization is expected to provide information required by management to determine how effective their policies and implementation are. It is on this realization that this study will attempt to determine how effective are those information to aid management in solving day to day problems. It signifies defects or problems; the research will examine number of themnamely:


  1. There exists no relationship between the internal audit and management.
  2. Internal audit does not assist in the detection and prevention of waste.
  3. Internal audit does not assist in detection and prevention of




Objectives of the study include:


  • To ascertain if the duties of the internal auditor assist management in taking informeddecision.
  • To find out if internal audit assists in the detection and prevention of fraud.
  • To detect if internal audit helps in checking waste
  1. Is there any relationship between the internal audit and management?


  1. Does internal audit assist in the detection and prevention of fraud?
  • Does internal audit assist in the detection and prevention of waste?




To justify the research topic, internal audit as an aid to management and to enable the researcher to draw a logical conclusion, there is need to make guesses as solutions to the topic which are subject to acceptance and rejection are based on the result of the test.



  • H0: There is no relationship between the internal audit andmanagement.


  • H1: There is a relationship between the internal audit andmanagement.





  • H0: Internal audit does not assist in the defection and prevention of waste andfraud.
  • H1: Internal audit assist in the detection and prevention of waste and fraud.




  • The purpose of the study is to determine the extent of co-operation between the internal audit andmanagement.
  • To ascertain the extent of co-operation between the internal auditor and externalauditor.
  • To evaluate the extent to which internal audit helps in preventing waste and
  • To find out if internal audit is equipped enough to prevent an error proof workingcondition.


The benefits of the study to:


The Internal Audit-


  1. Internal audit within an organization is effective for efficient work of the generalstaff.
  2. The internal audit in an organization will help detect, minimize or eliminate fraud in anorganization.
  • Internal audit assist the management in the smooth running of the organization by complying with the policies, laws andregulation.
  1. Internal audit in an organization will help to review and appraise the effectiveness,adequacyandapplicationofaccounting,financialand

other controls in order to promote effective control at the lowest possible cost.

  1. Whether an internal audit department could help to determine the reliability and integrity of financial and other data produced within the organization, thereby securing the jobs ofemployees.

The management of the organization-


  1. Management will experience an error free working environment maintained by internalaudit.
  2. Management will enjoy the reduction or elimination of waste and fraud within theorganization.
  • The general staff will be effective anddedicated.


  1. Management will enjoy a healthy relationship between it and internal auditors.


This research work is to evaluate internal auditing in an organization using soap, detergent and household products company as a case study. The research work particularly focuses on the internal audit as an aid to management in themay and baker plc and drugfield specialty



There are constraints encountered in carrying out this research work, this includes;



This research work was conducted simultaneously with normal academic work within a short period of time in which some valuable information could be obtained.



In an effort to have a sufficient research material to be able to write extensively on the subject matter, the researcher was faced with some financial predicament considering high cost of not only education materials coupled with the high transport fare.


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