An Empirical Analysis of Forensic Accounting Skills and Financial Reporting Quality in Listed Nigerian Deposit Money Banks

Abstract

The main objective of this study is to empirically examine the application of forensic accounting skills in improving financial reporting quality (FRQ) of listed Deposit Money Banks (DMBs). The study employed a survey research design and the population of the study consists of all the DMBs listed on the floor of the Nigerian Stock Exchange as at 31st December, 2020. The study used primary sources of data collection through survey instrument and ninety- eight (98) copies of questionnaire
were administered to respondents drawn from DMBs. The variables of the study consist of dependent variable which is financial reporting quality and independent variable which is forensic accounting skills proxied by fraud prevention detection and deterrence skills (FPDDS), forensic audit, investigation and interviewing skills (FAIIS), litigation
mediation and arbitration skills (LMAS), and computer assisted review and audit review (CARAR). The data was analyzed using PATH analysis via Smart-PLS software. The result of the analysis revealed that FPDDS have positive and significant effect on FRQ, FAIIS have a positive and significant impact on FRQ and LMAS have positive and significant influence on FRQ. CARR has no significant effect on FRQ. The study concluded that forensic accounting skills have a significant impact on
financial reporting quality collectively but base on the individual result of each set of skills, it was found that some have positive and significant impact on FRQ of DMBs while other have no any significant impact. Also, the study recommended that considering the important of forensic accounting techniques especially forensic audit, investigation and interviewing skills that have significant impact on financial reporting
quality of all the DMBs. In addition, it is recommended that internal audit staff should regularly undergo training and development programs to acquaint them with relevant knowledge and skills for effective forensic auditing.

Keywords: forensic accounting skills, financial reporting quality, listed deposit money banks, Nigeria