AUDIT INDEPENDENCE: ENHANCING ACCOUNTABILITY AND TRANSPARENCY IN CORPORATE ORIGINATION
CHAPTER ONE
INTRODUCTION
1.1. Background of the study
In achieving transparency and accountability in organizations, audit independence has to be taken seriously and implemented adequately. It is a known fact that transparency makes a corporate organization more profitable. The subject of transparency and accountability in modern day corporate organizations
has continued to receive attention as never before. It has become a subject of discuss and empirical research both in developed and developing countries of
the world simply because of some recent financial crises and corporate scandals. Greater transparency and accountability are argued to improve the
performance of corporate organizations through better resource allocation, enhanced eiciency
and increased growth prospects (Chipwa, 2005).
Enhancing transparency and accountability are central to the improvement of corporate governance mechanisms. Basically, transparency is a vital means of
enhancing the performance and accountability of firms (Katra, 2003). Transparency is seen as critical for the culture of accountability especially where
market competition thrives (Katera, 2003). This implies that those with stake in the corporate organization must have all relevant and material information
regarding its aairs
in order to make proper judgment and if very necessary take remedies. This becomes possible only if those charged with the day to day
management of the corporate organization are transparent and accountable enough. This is premised on the fact that the task of managing the corporate
organizations’ aria sis fast moving in the ever-changing market or business environment. The essence of transparency and accountability especially in
Nigeria as a developing country cannot be over emphasized. In this regard, Katera (2003), submits that the key to business survival, creating and maintaining
wealth for the corporate organizations lies primarily on systems of transparency and accountability built into governance structures of such corporations.
There is therefore the need or quest to enhance transparency and accountability so as to ensure shareholders’ wealth maximization and overall performance
of the corporate organization. Against this backdrop, this study focuses on enhancing accountability and transparency in corporate organizations in Nigeria.
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