ENHANCING PUBLIC CONFIDENCE FINANCIAL REPORTING: THE ROLE OF CORPORATE GOVERNANCE
REVIEW OF RELATED LITERATURE
In other to understand the significance of financial reporting, one is required to be well versed in the theory and practice of accounting and corporate
governance. This review of literature is organized in stages or sections addressing the topic in one way or the other. The first stage is the concept of corporate
governance, a synopsis of financial reporting, that places emphasis on the historical development of audit report, then the various audit standards, which
members of the professional accounting bodies are expects to company with when producing an audit reports. Included in the auditor’s general standard are
competence, independence, care and integrity of the auditor. The credibility of the financial report depends to a large extend on the factors and if the users of
the reports should doubt anyone of those standard required the complete relevance on the audit report may be questioned. Therefore, since the standards
may act an audit and subsequently the financial report, they may be examined to the extent of their erect.
The third stage is the audits standard and evaluation, which include adequate planning and supervision, compliance with rules and regulations, internal
control system and evident. The auditing standard and guideline “audit report” and “audit report to management” issued by the auditing practice committee
(UK) required the auditor to report to monitors (statutory report) and to the management who instituted the report.
Therefore to report audit work to an organization such as Consolidated Breweries Nig. Plc, a limited liability company the auditors are required to produce
two reports which are domestics report and the statutory report. The domestic report is communicated to management to address each of weakness and
suggestions of improvement. The statutory report is communicated to the shareholders of the organization. Such 35g (1) companies and Allied Matter Act
(CAMA) 2004 provided that the report shall contain statement as to the matters mentioned in schedule 6 of the Act.
For the purpose of the project we shall be guided by the sub – headings provided by the auditory standard procedures such as form and distribution
timeliness, accounts and financial report. Although he is reporting primarily to the management, the in terms / auditor white work form basis for a sound
independent external audit has also been considered under the investigation function.
The activities of the internal auditor constitutes “a protective and constructive service to management” (Okolo 2007: 34), protections in the sense that the
internal auditor guards against errors, fraud, waste and decision from established policies and objectives, and assessment of the various aspects of the
operation ad make recommendations for improvements. The internal auditor is therefore a tool for management.
2.1 The Concept of Corporate Governance
In a converging world where the gospel of free markets and democracy is resonating more than ever before, and given the far- reaching impact of companies’
operations on the wealth of nations, its bio- diversity and the distribution of economic well- being; it is becoming increasingly clear that the governance of
companies, corporations, family owned businesses, small and medium scale enterprises and business associations must matter, as does political
governance. According to Oladele (2006) Corporate Governance would entail, relationships between the shareholders and the company, the exercise of
corporate powers by the two main organs of the company- the Board and the Annual General Meeting and executive management generally, directors’
responsibilities for accountability and rectitude, more so as detailed by dierent
statutes and regulations. James (2009) added that honest and fair trading by
corporations, fair and equitable treatment of shareholders, minority shareholders alike, transparency and credible disclosure standards, products that take
cognizance of the health of consumers, corporate citizenship and the business judgment rule are the core areas of corporate governance.