Assessing the Effectiveness of Forensic Accounting In Reducing Financial Fraud in Nigeria Banking Sector

Abstract

This study assesses the effectiveness of forensic accounting in reducing financial fraud in Nigeria’s banking sector. Specifically, it investigates the impact of forensic accounting techniques, tools, and professional expertise on the prevention and detection of financial fraud. The study employed a quantitative research design, using structured questionnaires administered to 81respondents. Descriptive statistics, hypothesis testing, and correlation analysis were used to evaluate the responses. Findings revealed that 65.5% of respondents strongly affirmed the significant impact of forensic accounting techniques on fraud reduction, supported by a correlation coefficient of 91.6%. Additionally, 38 respondents strongly agreed that forensic accounting tools are highly effective in detecting and preventing fraud, with a correlation coefficient of 86.9%. Furthermore, 75.3% of respondents acknowledged the crucial role of forensic accounting expertise in combating fraud, backed by a correlation coefficient of 59.9%. All three null hypotheses were rejected at a 5% significance level, affirming the effectiveness of forensic accounting practices. The study concludes that forensic accounting significantly enhances fraud detection and prevention in Nigerian banks. It recommends greater investment in forensic accounting personnel, adoption of advanced forensic tools, and the integration of forensic practices into routine banking operations. These findings contribute to the growing literature on forensic accounting and provide practical insights for stakeholders in fraud risk management.