Descriptive statistics was used to summarize the demographic information and the research question in this study while the hypothesis was tested using t-test analysis 4.3 TEST OF HYPOTHESES
This section is concerned with the testing of hypotheses earlier stated. In doing this, t-test was used. A test of hypotheses help to decide which of the contradictory claims is correct. It acts as guide through the research work in order to draw a logical or empirical conclusion.
Decision Rule
If the calculated value is greater than the critical value, we reject the null hypothesis or accept the null hypothesis if the calculated value is less than the critical value.
Table: 4.3.1
sex
Frequency Percent Valid Percent Cumulative Percent
Valid
male 4 50.0 50.0 50.0
female 4 50.0 50.0 100.0
Total 8 100.0 100.0
Table 4.3.1 which is descriptive table of values showing the sex distribution of the respondents, from the result, it can be ascertain that 4(50%) of the respondents are male, while 4 (50%) of the respondents are female. Hence we conclude that the number of male and female respondents are equal.
Table: 4.3.2
Marital status
Frequency Percent Valid Percent Cumulative Percent
Valid
single 3 37.5 37.5 37.5
married 5 62.5 62.5 100.0
Total 8 100.0 100.0
Table 4.3.2 The table of values above shows the marital status of the respondents, from the result, the frequency of the respondents who are single are 3(37.5%) whereas the frequency of the respondents who are married are 5(62.5%). Hence we conclude that majority of the respondents are married.
Table 4.3.3
Age
Frequency Percent Valid Percent Cumulative Percent
Valid
less than 25 7 87.5 50.0 50.0
26-50 3 37.5 50.0 100.0
Total 8 100.0 100.0
From the table 4.3.3 of descriptive values on the age of the respondents, from the result, the respondents with their age less than 25 years are 7(87.5%) whereas those with age between the bracket of 26-50 years are 3(37.5%), hence we conclude that the respondents with the age bracket of less than 25 years are higher.
Table 4.3.4
Experience
Frequency Percent Valid Percent Cumulative Percent
Valid
less than 10 years 4 50.0 50.0 50.0
11-20 2 25.0 25.0 75.0
more than 21 2 25.0 25.0 100.0
Total 8 100.0 100.0
Table 4.3.4 which is descriptive table of values showing the experience distribution of the respondents, from the result, it can be ascertain that 4(50%) of the respondents have a working experience below 10years, those with the working experience between the age bracket of 11-20 are 2(25%) and those with the working experience more than 21 years are 2(25%). Hence we conclude that majority of the respondents have a working experience between the age bracket less than 10 years.
Table 4.3.5
Qualification
Frequency Percent Valid Percent Cumulative Percent
Valid
Bachelor 7 87.5 87.5 87.5
Master 1 12.5 12.5 100.0
Total 8 100.0 100.0
Table 4.3.5 which is descriptive table of values showing the qualification distribution of the respondents, from the result, it can be ascertain that 7(87.5%) of
the respondents are bachelors degree, while 1(12.5%) of the respondents have masters degree. Hence we conclude that majority of the respondents have bachelor degree.
Table 4.3.6
Position in the organization
Frequency Percent Valid Percent Cumulative Percent
Valid
management administrative
staff 5 62.5 62.5 62.5
Accountant 3 37.5 37.5 100.0
Total 8 100.0 100.0
Table 4.3.6 which is descriptive table of values showing the position of the respondents in the organization, from the result, management administrative are 5(62.5), whereas the respondents who are accountants are 3(37.5%). Hence we conclude that majority of the respondents are management administrative.
Table 4.3.7
Providing internal audit increases the probability of fraud discovery Frequency Percent Valid Percent Cumulative
Percent
Valid
strongly agree 5 62.5 62.5 62.5
agree 1 12.5 12.5 75.0
disagree 1 12.5 12.5 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The above table 4.3.7 shows the respondents opinion on if providing internal audit increases the probability of fraud discovery, it can be ascertain that 5 (62.5%) affirmed strongly agree, 1(12.5%) affirmed agree, 1(12.5%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents
affirmed strongly agree. Hence we conclude that providing internal audits increases the probability of fraud discovery.
Table 4.3.8
Review of generated financial reports that compares budgets to actual financial activities by appropriate management prevents fraudulent activities
Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 4 50.0 50.0 50.0
agree 1 12.5 12.5 62.5
disagree 1 12.5 12.5 75.0
strongly disagree 2 25.0 25.0 100.0
Total 8 100.0 100.0
The table 4.3.8 above shows the respondents opinion on activities by appropriate management prevents fraudulent activities, it can be ascertain that 4 (50%) affirmed strongly agree, 1(12.5%) affirmed agree, 1(12.5%) affirmed disagree, 2(25%) affirmed strongly disagree. From the result, majority of the respondents affirmed strongly agree. Hence we conclude that activities by appropriate management prevents fraudulent activities.
Table 4.3.9
Provision of internal auditors increases the probability of problem discovery Frequency Percent Valid Percent Cumulative
Percent
Valid
strongly agree 3 37.5 37.5 37.5
agree 3 37.5 37.5 75.0
disagree 1 12.5 12.5 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The above table 4.3.9 shows the respondents opinion on provision of internal auditors increases the probability of problem discovery, it can be ascertain that 3 (37.5%) affirmed strongly agree, 3(37.5%) affirmed agree, 1(12.5%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents affirmed strongly agree. Hence we conclude that provision of internal auditors increases the probability of problem discovery.
Table 4.3.10
Performance of risk assessment by internal auditors prevent fraudulent activities Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 3 37.5 37.5 37.5
agree 2 25.0 25.0 62.5
disagree 2 25.0 25.0 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The above table 4.3.10 shows the respondents opinion on performance of risk assessment by internal auditors prevent fraudulent activities, it can be ascertain that 3 (37.5%) affirmed strongly agree, 2(25%) affirmed agree, 2(25%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents affirmed strongly agree. Hence we conclude that performance of risk assessment by internal auditors prevent fraudulent activities.
Table 4.3.11
Manufacturing organization with internal auditors detects fraud relatively easier than organizations without internal auditors
Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 4 50.0 50.0 50.0
agree 2 25.0 25.0 75.0
disagree 1 12.5 12.5 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The above table 4.3.11 shows the respondents opinion on manufacturing organization with internal auditors detects fraud relatively easier than organizations without internal auditors, it can be ascertain that 4 (50%) affirmed strongly agree, 2(25%) affirmed agree, 1(12.5%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents affirmed strongly agree.
Hence we conclude that manufacturing organization with internal auditors detect fraud relatively easier than organizations without internal auditors.
Table 4.3.12
Provision of internal audit cause detection of fictitious assets
Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 4 50.0 50.0 50.0
agree 1 12.5 12.5 62.5
disagree 1 12.5 12.5 75.0
strongly disagree 2 25.0 25.0 100.0
Total 8 100.0 100.0
The above table 4.3.12 shows the respondents opinion on provision of internal audit cause detection of fictitious assets, it can be ascertain that 4 (50%) affirmed strongly agree, 1(12.5%) affirmed agree, 1(12.5%) affirmed disagree, 2(25%) affirmed strongly disagree. From the result, majority of the respondents affirmed
strongly agree. Hence we conclude that provision of internal audit cause detection of fictious assets.
Table 4.3.13
Providing the internal audits causes detection of equity frauds
Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 3 37.5 37.5 37.5
agree 2 25.0 25.0 62.5
disagree 2 25.0 25.0 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The table 4.3.13 shows the respondents opinion on activities by appropriate management prevents fraudulent activities, it can be ascertain that 3 (37.5%) affirmed strongly agree, 2(25%) affirmed agree, 2(25%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents affirmed strongly agree. Hence we conclude that providing the internal audits causes detection of equity frauds.
Table 4.3.14
Providing the internal audit causes detecting fictitious expenses
Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 2 25.0 25.0 25.0
agree 4 50.0 50.0 75.0
disagree 1 12.5 12.5 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The table 4.3.14 shows the respondents opinion on providing the internal audit causes detecting fictitious expenses, it can be ascertain that 2 (25%) affirmed strongly agree, 4(50%) affirmed agree, 1(12.5%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents affirmed agree. Hence we conclude that activities providing the internal audit causes detecting fictitious expenses.
Table 4.3.15
Assessment value of loss to fraud
Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 5 62.5 62.5 62.5
agree 1 12.5 12.5 75.0
disagree 1 12.5 12.5 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The table 4.3.15 shows the respondents opinion on assessment value of loss to fraud, it can be ascertain that 5 (62.5%) affirmed strongly agree, 1(12.5%) affirmed agree, 1(12.5%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents affirmed strongly agree. Hence we conclude that assessment value of loss to fraud.
Table 4.3.16
Compensation payable to victims of fraud
Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 3 37.5 37.5 37.5
agree 3 37.5 37.5 75.0
disagree 1 12.5 12.5 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The table 4.3.16 shows the respondents opinion on compensation payable to victims of fraud, it can be ascertain that 3 (37.5%) affirmed strongly agree, 3(37.5%) affirmed agree, 1(12.5%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents affirmed strongly agree and agree. Hence we conclude that compensation payable to fraud reduces fraud in an organization.
Table 4.3.17
Measuresto reduce impact of fraud
Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 3 37.5 37.5 37.5
agree 2 25.0 25.0 62.5
disagree 2 25.0 25.0 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The table 4.3.17 shows the respondents opinion on measures to reduce impact of fraud, it can be ascertain that 3 (37.5%) affirmed strongly agree, 2(25%) affirmed agree, 2(25%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents affirmed strongly agree. Hence we conclude that measures to reduces impact of fraud.
Table 4.3.18
Punishments to culprits of fraud
Frequency Percent Valid Percent Cumulative Percent
Valid
strongly agree 2 25.0 25.0 25.0
agree 3 37.5 37.5 62.5
disagree 2 25.0 25.0 87.5
strongly disagree 1 12.5 12.5 100.0
Total 8 100.0 100.0
The table 4.3.18 shows the respondents opinion on punishment to culprits of fraud, it can be ascertain that 2 (25%) affirmed strongly agree, 3(37.5%) affirmed agree, 2(25%) affirmed disagree, 1(12.5%) affirmed strongly disagree. From the result, majority of the respondents affirmed agree. Hence we conclude that majority of the respondents affirmed that punishment to culprits of fraud reduces fraud.
Hypothesis One
Ho: Internal audit does not contribute significantly to fraud prevention in a manufacturing organization. The analysis was done using questions 1 – 4 in the questionnaire. See appendix 1
internal audit * fraud prevention Crosstabulation
fraud prevention Total single married
internal audit
male
Count 3 1 4
% within internal audit 75.0% 25.0% 100.0%
% within fraud prevention 100.0% 20.0% 50.0%
% of Total 37.5% 12.5% 50.0%
female
Count 0 4 4
% within internal audit 0.0% 100.0% 100.0%
% within fraud prevention 0.0% 80.0% 50.0%
% of Total 0.0% 50.0% 50.0%
Total
Count 3 5 8
% within internal audit 37.5% 62.5% 100.0%
% within fraud prevention 100.0% 100.0% 100.0%
% of Total 37.5% 62.5% 100.0%
Chi-Square Tests Value Df Asymp. Sig.
(2-sided)
Exact Sig. (2-sided)
Exact Sig. (1-sided)
Pearson Chi-Square 0.021a 1 .028
Continuity Correctionb 2.133 1 .144
Likelihood Ratio 6.086 1 .014
Fisher's Exact Test .143 .071
Linear-by-Linear Association 4.200 1 .040
N of Valid Cases 8
a. 0 cells (100.0%) have expected count less than 5. The minimum expected count is 1.50.
b. Computed only for a 2x2 table
Decision Rule
The probability value of the Pearson chi-square is (0.021) which is less than the 5% (0.05) percent level of significance on the average, hence we accept Alternate hypotheses (H1), and conclude that internal audit has statistical significance association on fraud prevention in manufacturing organization.
Hypothesis Two
Ho: Internal audits does not contribute significantly to fraud detection in manufacturing organization. This was done using questions 5–8 in the questionnaire. See appendix 1.
internal audit * fraud detection Crosstabulation
fraud detection Total
less than 10 years
11-20 more than 21
internal audit
less than 25
Count 3 0 1 4
% within internal audit 75.0% 0.0% 25.0% 100.0%
% within fraud detection 75.0% 0.0% 50.0% 50.0%
% of Total 37.5% 0.0% 12.5% 50.0%
26-50
Count 1 2 1 4
% within internal audit 25.0% 50.0% 25.0% 100.0%
% within fraud detection 25.0% 100.0% 50.0% 50.0%
% of Total 12.5% 25.0% 12.5% 50.0%
Total
Count 4 2 2 8
% within internal audit 50.0% 25.0% 25.0% 100.0%
% within fraud detection 100.0% 100.0% 100.0% 100.0%
% of Total 50.0% 25.0% 25.0% 100.0%
Chi-Square Tests
Value Df Asymp. Sig. (2-sided)
Pearson Chi-Square 0.039a 2 .223
Likelihood Ratio 3.819 2 .148
Linear-by-Linear Association .636 1 .425
N of Valid Cases 8
a. 0 cells (100.0%) have expected count less than 5. The minimum expected count is 1.00.
Decision Rule
The probability value of the Pearson chi-square is (0.039) which is less than the 5% (0.05) percent level of significance on the average, hence we accept Alternate
hypotheses (H1), and conclude that internal audit has statistical significance association on fraud detection in manufacturing organization.
Hypothesis Three
Ho: Internal audit does not contribute significantly to fraud remediation in a manufacturing organization. Questions 9-12 were used in the analysis. See appendix 1
internal audit * fraud remediation Crosstabulation
fraud remediation Total management
administrative staff
Accountant
internal audit
Bachelor
Count 5 2 7
% within internal audit 71.4% 28.6% 100.0%
% within fraud remediation 100.0% 66.7% 87.5%
% of Total 62.5% 25.0% 87.5%
Master
Count 0 1 1
% within internal audit 0.0% 100.0% 100.0%
% within fraud remediation 0.0% 33.3% 12.5%
% of Total 0.0% 12.5% 12.5%
Total
Count 5 3 8
% within internal audit 62.5% 37.5% 100.0%
% within fraud remediation 100.0% 100.0% 100.0%
% of Total 62.5% 37.5% 100.0%
Chi-Square Tests Value Df Asymp. Sig.
(2-sided)
Exact Sig. (2-sided)
Exact Sig. (1-sided)
Pearson Chi-Square 1.905a 1 .168
Continuity Correctionb .076 1 .783
Likelihood Ratio 2.209 1 .137
Fisher's Exact Test .375 .375
Linear-by-Linear Association 1.667 1 .197
N of Valid Cases 8
a. 4 cells (100.0%) have expected count less than 5. The minimum expected count is .38.
b. Computed only for a 2x2 table
Decision Rule
The probability value of the Pearson chi-square is (1.905) which is greater than the 5% (0.05) percent level of significance on the average, hence we accept null hypotheses (Ho), and conclude that internal audit has no statistical significance association on fraud remediation in manufacturing organization.
CHAPTER FIVE
SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS 5.1 Introduction
This chapter deals on the summary of the findings, conclusions of the study, recommendation, suggestions for further studies.