Abstract
This study seeks to examine the ways to curb fraudulent practices among Not for Profit Organizations (NPOs) through the accountability processes. NPOs are one of the least regulated sectors of the economy making them prone to incidences of fraud which are often undetected within the poor accountability system. It is imperative to examine the nature and negative effects of fraud to stakeholders who have placed their trust on the activities of the non-profit organizations but are unable to obtain justification of their activities because funds are not judiciously utilized for the purpose they were raised. The study particular considered the perspective of chartered accountants by arguing that have a significant role in understanding the accountability framework for fraud prevention and control in NPOs. The population of the study consist of all chartered accountants of ICAN in Ikorodu and a questionnaire was administered to the participants. Regression analysis was used to test the relationship between accountability processes (internal audit, governance, external audit and regulatory process) and fraudulent practices among NPOs. The results of the analysis showed that there is no relationship between accountability framework variables - internal audit, governance and the regulatory process, however external audit showed a significant relationship with the fraudulent practices in NPOs. The study recommended that external audit be made mandatory for NPOs amongst other recommendation. Keywords : Fraud, Accountability, Non-profit making organization, Governance, Stakeholders DOI : 10.7176/RJFA/10-14-01 Publication date :July 31 st 2019
Highlights
The non-profit making sector has an important role to contribute in fulfilling the desire of the social community whether it is religious, health, educational and other human service organizations
Respondents mostly agreed that good governance will aid in curbing fraudulent practices in Not for Profit Organizations (NPOs) and that the code of governance 2016 produced by the financial reporting council of Nigeria if practiced will help in curbing fraudulent practice occurrence
This is contrary with the retention of the null hypothesis ‘good governance does not have any significant relationship with fraudulent practices being carried out in Nigerian NPOs’ The finding align with the perspectives of Greenlee et al, (2007) which study observed that despite the existence governance structure, fraudulent practices were being carried out by those in the helms of governance
Summary
The non-profit making sector has an important role to contribute in fulfilling the desire of the social community whether it is religious, health, educational and other human service organizations. Not-for-profit organizations come in a variety of sectors, such as religious, health, social services, commerce, education, sports, clubs, cooperatives and the arts. Not-for-profits are not owned on a commercial basis and mostly rely on members’ subscriptions and contributions, program incomes, grants which could be public or private, other fundraising events and income from such investments. These category of organizations rely on appointed board of trustees and management officers in preserving of the entity’s resources
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