1.1 BACKGROUND TO THE STUDY
The’ term management was coined from the Italian word “managgiare” which connotes ‘to train horses’. It was originally used to indicate the process of training or coordinating sporting activities. Later its application was extended to the operations of government and businesses. Akpala (2001) describes management as the process of combining and utilizing organization’s inputs (men, materials, money and’ machine) by the mix of planning, organizing, directing and controlling activities for the purpose of producing outputs (usually goods and services), desired by the customers, so that the organization’s objectives are accomplished. In the definition given above, it is worthy of inference that control is an essential tool of management. The term control was rightly described by Lucey (1990) as “a systematic effort by business management to compare performance with predetermined standards, plans or objectives to ensure that performance is in line with standard and also to take remedial action required so that human and other corporate resources are employed in the most efficient and profitable manner. Control system is very essential in any organization be it a private or a public establishment/sector in order to check how effective and efficient they are in maximizing the use of resources. One of the measures commonly used to minimize wastage and guide plans to their eventual accomplishment is Internal Auditing. Embezzlement, misappropriations, fraud and wastage of resources have been the characteristics of government ministries and public enterprises. Based on the literatures and daily experiences, one could conclude that there is a fairly unanimous feeling of dissatisfaction with the performance of most Nigerian public enterprises to date. Internal auditing has been defined by Adelaja (2000) as “an independent appraisal of activity within an organization for the review of operations as a service to management. It is a form of a managerial control which functions by measuring and evaluating the effectiveness of other controls”. This project seeks to find out if the internal audit department exists in these enterprises and if it does, in what way has it contributed to the efficient management of such enterprise. It is not possible to sample all the public enterprises in Nigeria therefore the main focus of this project is on the Nigeria Television Authority (NTA), Lagos branch.
1.2 STATEMENT OF PROBLEM
Ogunjimi (2001) while writing on accountability in the Nigerian public enterprise observed that in the course of government’s involvement in the economic and social aspects of the ‘nation’s development; public enterprises now play a vital role in the development process and since these public enterprises handle high proportion of government fund, proper account of stewardship are needed. It is also important to note that established controls to ensure proper accounts of operation have been grossly abused by lack of accountability and stories of woe on the performance of such enterprises. Despite the controls installed, irregularities, embezzlement, misappropriation of public funds, fraud and gross wastage of resources-are still the order of the day in the public enterprises. The internal audit department exists so as to reduce organizations’ excesses such as financial mismanagement and lack of proper accountability to the barest minimum even if it cannot be completely eliminated. Internal audit which is supposed to serve as a control tool sometimes becomes ineffective due to some inbuilt factors that impair its independence and thus hinder its efficiency.
1.3 STATEMENT OF OBJECTIVE
The purpose of this project is to critically evaluate internal audit as a control tool for efficient management in Nigerian public enterprises using the Nigeria Television Authority, Lagos branch as a case study.