Pathway To Forensic Investigation In Nigeria
CRITICAL FACTS ABOUT THE CHARTERED INSTITUTE OF FORENSIC AND INVESTIGATIVE AUDITORS OF NIGERIA (CIFIAN), A MECHANISM FOR PREVENTION OF FRAUD, CORRUPTION AND CYBER CRIMES IN NIGERIA
(PREVENTION IS ALWAYS BETTER THAN CURE)
As thorough bred and accomplished professionals with strong family and religious values, we deemed it appropriate to defend our names as promoters of the Chartered Institute of Forensic and Investigative Auditors of Nigeria (CIFIAN) Bill, by setting the records straight especially, as it concerns our selfless and altruistic involvement with the promotion of the noble objectives of CIFIAN as well as our professional accomplishments. It should be noted that while the malicious publication in electronic and print medias as well as social medias against CIFIAN and its’ promoters can be easily dismissed by every discerning mind, considering the timing and the obvious lies conveyed by those behind it, leaving such lies in the public domain without appropriate response may be interpreted by unsuspecting public as conceding to the antics of those who are out to oppose the passage of this Bill not on the ground of any logical reasoning, but the fact that they wish to have over-reaching control over things that are beyond the scope of their professional competences. We therefore wish to set forth the following critical facts as our response to all the mischievous and calumnious publications by the opposers of CIFIAN Bill, who has vowed never to allow the noble work done by the Nigerian Senate on 5th July, 2018 get a possible concurrence by the House of Representatives, by addressing the issues raised in their media publications at different occasions under different headlines as follows:
Chartered Institute of Forensic and Investigative Auditors of Nigeria is anti-fraud organization saddled with the responsibility of providing skills to professionals from relevant fields on the use of science and technology to detect, prevent and investigate fraud no matter how small-big, and also put in place some sophisticated mechanisms to prevent future occurrence. Therefore, CIFIAN membership cut across other professions like law, criminology, Economics, Security experts, Investigators, cyber security, finance and banking, economics, psychology, police detectives, etc.
1.1. Forensic Investigative auditing integrates investigative auditing draws from these skills and places them at the central unit of analysis of its function. This is because Forensic and Investigative Auditing is inextricably tied to litigation support, court testimony and expert witness. These are the contextual grounds upon which the evolution of CIFIAN is predicated as an instrumental professional paradigm shift in the systematic fight against fraud of all kinds in the country. CIFIAN is professionally distinct from other accounting bodies both in its mission and membership composition. CIFIAN is not another accounting body in Nigeria, but it is anti-fraud body.
1.2. Before I proceed futher, on behalf of the Board members and the entire members of the Chartered Institute of Forensic and Investigative Auditors of Nigeria, I hereby appreciate the ASSOCIATION OF NATIONAL ACCOUNTANTS OF NIGERIA (ANAN) for the professional maturity exhibited on 14th of April, 2018, during the public hearing of the Bill to establish CIFIAN, by supporting the Bill whole heartedly in their capacity as one of the approved accounting professional bodies in Nigeria. Posterity will remember ANAN for that
2.0. WHY DO WE NEED FORENSIC AND INVESTIGATIVE AUDITORS OF NIGERIA?
2.1. As we are aware, Nigerian government has lost billions of naira and dollars in the past few years to fraud, corruption and Cyber Crimes, until the government treasury became empty and citizens left to their faith. It is a statement of fact that as distasteful as it is to hear that our nation Nigeria is rated among countries with very poor fraud prevention records in the world, it is even more worrisome to know that despite the federal government renewed efforts in tackling fraud, corruption and Cyber crimes, very little result has been achieved, especially in the area of securing conviction against perpetrators of fraud in Nigeria. This is because many of the cases, especially the high profile ones, are either thrown out for want of evidence or are unnecessarily delayed and stocked in court for years, due to one reason or the other.
2.2. Government at all levels are losing billions of Naira to fraud and most criminal cases bordering on fraud, corruption and cyber crimes are partly due to lack of investigators. According to Femi Falana, prosecution of financial fraud in Nigeria hampered partly by lack of experienced investigators and prosecutors, and whereby they exist they are overwhelmed. We need not to mention here that government agencies and multinational corporations spend huge sums out of scare foreign exchange to retain expatriates forensic and investigative auditors to come and unravel complex cases of fraud.
2.3. It is a statement of fact that Nigeria has been burning with the fire of fraud, corruption, bribery, money laundering, white collar crimes and cyber crimes which have for long ravaged our economy and dwarfed development. It has been shown by empirical research and legal pronouncements that these social vices that led to the collapse and failure of many companies were aided and abetted by invidious and insidious accounting practices. According to the Nigerian Inter-Bank Settlement System (NIBBS) reported in the Nigerian Newspaper of June, 2018 that Nigerian banks lost N12.30 billions to fraud in the past four years.. According to the Managing Director of NIBBS recorded fraud volume in Nigeria banks increased from N1,461 billion in 2014 to staggering N23.043 cases on 2017. This is worrisome, and for God’s sake, this country called Nigeria belongs to all of us.
2.4. Corruption Fraud and Cyber Crimes has become an octopus with huge tentacles extending into all facets of human endeavour and sparing no one in the process: politics, business and sports. In every respect, the concern is about the devastating effects of corruption and fraud on individuals, nation state and the performance of the economy and society in general. The fact that fraud and corruption is deeply embedded in nearly all human and structural relationships makes it a primary topic of interest everywhere and by every government, organization, business and opinion leaders. The global acknowledgement of the ubiquity of corruption and its egregious discontent is reinforced by the UN, World Bank, IMF and various regional and international organizations. The global concern is about the insidious nature of fraud, corruption and cyber crimes (incorporating money laundering and other white collar crimes) and the wide range of its corrosive effects on societies. The manifestation of this evil phenomenon undermines democracy and the rule of law, distorts markets, emasculates Government efforts in providing basic infrastructure, and allows organized crime, terrorism and other threats to human security to flourish. In short, there is universal disaffection with and resentment against fraud corruption and cyber crimes.
2.5. Scandalous collapses, financial losses, loss of employment and investment, and loss of earnings and means of livelihood are some of the consequential social dislocations and risks of corruption and fraud. The reality is that behind every fraud and fraudster there are real victims. Both insightful analyses and public perceptions in most developing countries suggest that fraud and corruption is rife in public service, where officials commit flagrant breaches of public trust by shading the truth through opacity in governance and contract awards and opportunistic procurement of public works and services. Fraud and corruption attenuates the institutional capacity of governments and organizations, hampers performance, distorts and weakens markets, and impedes economic development, trade and investment.
2.6. The contextual background to the heightened global interest in institutionalizing the practice of forensic and investigative audit through organizational frameworks such as the Chartered Institute of Forensic and Investigative Auditors of Nigeria (CIFIAN) is traceable to corporate governance concern of at least three antecedent kinds. First, recent corporate failures and scandals became scandalous not only because of the characteristics of the companies involved and their multiplier effect on national and global economies, but also because of the discovery that questionable accounting practices were notoriously insidious and widespread.
2.7. Secondly, the plethora of incriminating evidence linking accountants, auditors and these egregious accounting practices to the corporate scandals and failures led to a number of national and global corporate governance initiatives. Prior to the Arthur Andersen’s debacle, accountants had historically had a determinative role in fostering investors’ confidence and public trust through audit reports. Hitherto too, the accounting profession was largely self-regulated. But, the series of corporate fiascos suffered since the 1990s: (a) weakened the self-regulatory status of the accounting profession; (b) questioned the capacity of the profession to self-correct or purge itself from the opportunistic practices of its members; and (c) led to national and international calls for changes in financial reporting standards and better corporate governance codes.
2.8. Thirdly, and in consequence, the spate of corporate failures triggered a number of national and international responses, such as the U.S. congressional action that midwifed the Sarbanes-Oxley Act of 2002. In other words, the corporate calamities raised the consciousness of regulators and policy makers to the negligence or weakness of extant corporate governance practices across the world. The upshot was the global interest in new corporate governance architecture beyond merely widening the ambit of corporate responsibility of the accounting profession in certifying financial reporting integrity to encompass proactive measures to detect and prevent occupational fraud.
2.9. In our public service, those entrusted with public funds for the provision of citizen welfare, security and public services and those assigned with the responsibility of ensuring public oversight, transparency and accountability in governance, have been allegedly implicated in corruption, fraud and financial crimes. The daily press reportage of alleged corruption and fraud cases by the EFCC and ICPC is a pointer to the plethora of financial malfeasance in Nigeria. The regularity of press headlines of unbridled audacity and prevalence of corruption, fraud, white collar crimes in Nigeria and other SSA countries eloquently speak not to any sophisticated skill or stratagem but simply to the power of ‘connection’, a euphemism for holding top public office or being in the corridor of power. These are the contextual grounds upon which the evolution of CIFIAN is predicated as an instrumental professional paradigm shift in the systematic fight against fraud, corruption and cyber crimes in the country. CIFIAN is professionally distinct from other accounting bodies both in its mission and membership composition. Its vision and mission is to promote Transparency in Advanced Audit through certification, continuing professional education and training, conferences and seminars in forensic and investigative audit.
2.10. CIFIAN seeks to: (a) validate and enhance members’ standing as forensic and investigative auditors with a credible, comprehensive and internationally recognized certification; (b) instil employer confidence in members’ competences and career opportunities with a credential that certifies their expertise and capacity to expand their boundary of knowledge and skills in forensic and investigative audit; (c) perform forensic and investigative audit in accordance with international best practices, using a common globally recognized body of knowledge; and to remove opportunity from Fraud Tree completely.
2.11. It is wrong for Financial Accountants to regulate the preparation of corporate financial accounts, perform the audit and at the same time conduct the forensic and investigative audit of corrupt and fraudulent accounting practices thereof. It’s like the National Assembly setting up its Executive and Judicial arms within itself, or any of the other arms procuring the services of the others into its governance structure, and this will always lead to conflict of interest. That is why we have the three arms of government. In the same way we have office of the Accountant General of the Federation separately from the office of the Auditor General of for the Federation. This implies that one prepares the book of accounts while the other audit the account for the purpose of check and balances. Now forensic fraud investigation cannot be carried out by the same people that caused it in the first place, but should be done by independent forensic and investigative auditors to avoid conflict of interest.
2.12. The law was even helpless in the case of collapsed banks in Nigeria which were audited by some accounting Firms in Nigeria because NO act empowers them to carry out fraud investigation. The latest similar incidence is the fall of Diamond Bank, which would have been prevented if forensic and investigative auditors in Nigeria are backed by law, because they are experts in the area of sniffing out scores of fraud. Forensic experts look beyond and behind figures and can perceive dangers of fraud before it occurs.(RED FLAG).
2.13. Fraudsters on the other hand, have gone sophisticated and now engage digital technologies to perpetrate fraud, white collar crimes etc. In this case, our system requires a forensic and investigative auditing which has to do with the use of science and technology for fraud prevention, detection and investigation. There is a need for a paradigm shift if Nigeria economy must flourish. For this reason, Chartered Institute of Forensic and Investigative Auditors of Nigeria has arisen at a time like this to salvage Nigerian economy from total collapse. CIFIAN is saying that there is an urgent need for a change of method of doing thing, which shifting from the use of analogue in handling serious issues like fraud, corruption and cyber crimes. The reason is because this is an era of technology of which our nation must key into it in order to compete in the global market. It is only a mad man that will continue doing a thing, the same way, the same method year after year and expect different result.
2.14. It is beyond those Accountants that claimed to have anti-fraud mechanisms, because there is no professional body in Nigeria with anti-fraud mechanism, and the midwifed by some professional bodies since the early years of the collapse of colonialism in Nigeria has failed the nation woefully. The time for paradigm shift in response to global trend has come and we urge Honourable members to follow to step of the upper chamber, the Nigerian Senate to make this change possible for the good of Nigerian citizens.
2.15. In view of the above, there is a need for a separate body (Chartered Institute of Forensic and Investigative Auditors of Nigeria) that will be responsible for registration and regulation of professional forensic and investigative auditors who will be carrying out a check and forensic fraud investigation of fraudulent accounting practices of the book of account prepared by Accountants. It is not going to be business as usual, but this will help our country greatly when it is finally signed into law. This will give hope to our future generation and the children unborn, including those in overseas who have vowed never to return to Nigeria as a result of corrupt practices, insecurity and the level of damage done to our economy. Leaving this specialised area for accounting bodies is like putting a new wine in old bottle which of course we know that the old bottle will contaminate the new wine no matter good it may be.
2.16. We wish to state without fear or contradiction that all the promoters of the CIFIAN Bill are driven by the noble desire to make a difference in our existing anti-fraud mechanisms. It is interesting to note that while other persons appears contented with the current mechanisms for financial accountability and will do everything imaginable to frustrates anybody advocating for a paradigm shift from existing approaches to globally accepted practices, available statistics on the losses suffered by private and public practices as a result of weak anti-fraud mechanisms should ordinarily be worrisome to any patriotic Nigerian.
2.17. Concerned that the challenges of corruption, fraud, cyber crimes, money laundering and white collar crimes in Nigeria cannot be solved from the same level of consciousness and by the same cohort of professional bodies and practices that created them in the first place;
3.0. DIFFERENCES BETWEEN ACCOUNTANT OR TRADITIONAL AUDITORS AND FORENSIC AND INVESTIGATIVE AUDITORS
3.1. Forensic and Investigative Auditors’ work starts where traditional Auditors’ stopped. We are fraud Auditors, and our type of Audit is different from that of Accountants or traditional auditors. Traditional Auditors are checkers, and their work is a routine work of checking payment vouchers and accounting records to ensure compliance with rules and regulations, but forensic and investigative auditors look beyond and behind figures in search of fraud no matter the magnitude and put some measures in place to prevent future occurrence.
3.2. Accountants prepare financial statement and daily recording of financial transactions in an organisation, but a forensic auditor has nothing to do with preparation of accounting books, rather forensic auditors are needed only when fraud is suspected or have taken place. Therefore, a forensic auditor is a watch dog in an organisation and his or her presence intimidates fraudsters, because they are always afraid to commit fraud or cyber crimes because they knows that if they tries, they will be caught no matter the mechanisms used for such fraud.
3.3. Accountants or traditional Auditors have nothing to do with court, but forensic auditors work mostly end in court. As you are aware, in the history of Nigeria, traditional auditors or accountants have not been required for expert witness neither has their report being tenable in the court of competent jurisdiction, but forensic and investigative auditors’ reports always end in court, and at the same time needed to give expert witness.
3.4. Also of interest is that accounting bodies in the world are being regulated by International Federation of Accountants (IFAC), but forensic bodies like CIFIAN are being regulated by a different body called International Federation of Forensic Accountants and Auditors (IFFAA).. Therefore, no meeting point for Accountant/traditional auditors and Forensic and investigative auditors.
3.5. Accounting bodies is to regulate the practice of Accounting and not forensic and investigative auditing, but CIFIAN is to regulate the practice of forensic and Investigative Auditing in Nigeria as it is being practiced in other jurisdictions where similar anti-fraud organizations exist together with accounting bodies. It has not led to balkanization of accounting profession there and globally.
3-6. CIFIAN is anti-fraud organisation and NOT Accounting body and does not intend to offer statutory external audit, assurance, compliance auditing and Accounting services like Accountants rather CIFIAN’s work is all about fraud detection, prevention and investigation.
3.7. Forensic and Investigative Auditing is not just forensic accounting neither is it just forensic audit, but it is a combination of three elements which are FORENSIC + INVESTIGATION = AUDITING. Please nobody should be confused by the word audit in our name because audit there is used in its original meaning. Accountant is different from an Auditor. Accountant can be an Auditor, but an auditor may or must not be an accountant. Therefore, no one should be misled by whatever you think about the word auditor, rather go for more research and critical thinking and you will agree with me about this analysis. This is an era of deep, extra ordinary knowledge and digital era, which has made things easier than before. Forensic and Investigative Auditor only need the knowledge of accounting to unravel manipulation in accounting facts and figures, just as the knowledge of Law, criminology, philosophy etc are need to complete the forensic work.
3.8. Membership of Accounting bodies is limited to only Accountants, but Forensic and Investigative Auditor’ membership cut across other professions like Law, Criminology, Cyber Forensic, Investigators, Information Technology, Taxation, Banking and Finance, Economics, Security Expert, Police detectives, Accounting etc. This is due to the nature of the work involved which need combination of the listed professionals to be completed successfully. Forensic and Investigative Auditor will need knowledge of all these to be qualified as a forensic and investigative auditors.
3.9. Entering points of an accountant is 1st degree but ours is professional qualifications. For anybody to be admitted to our associate membership, he or she must have at least two year post professional qualification from a recognised body by CIFIAN, like, CFE, CPA, CISA, ICAN, ANAN, CITN,NBA,ICEN, CIBN, CFA, CIPFA, ACCA, IICFIP, CPFM, ACSA, ICAEW, etc. These categories must complete our training in ten modules and can be certified as an associate member of the institute. Associate member will pass our exams from PE1-PE4 if without experience, before qualifying as a chartered member. For Chartered membership, one must have a minimum of ten years post professional qualification experience in the relevant fields and pass our exams at stage 3 & 4 before he or she can be qualified as our chartered member.
3.10. I want to state clearly here that Accounting profession is multidimensional, and this is not limited to Accounting profession only, but it applies to other professions like Medical and legal profession. In Medicals, there is dentist, Cardiologist, opticians, nursing, neurologist, etc. In Law there are bodies for reconciliators and arbitrators etc, and they have not balkanized Law profession, rather they co-exist with Nigeria Bar Association. In Nigeria we have Police, Road Safety, VIO, Civil Defense, Nigeria Customs Services. These bodies have not Balkanized Police Force; rather they put synergy together for perfect of life and properties in Country. Therefore, the coming of the Chartered Institute of Forensic and Investigative Auditors of Nigeria is a good innovation and should be celebrated by every well meaning Nigerians.
4.0. FORENSIC AND INVESTIGATIVE AUDITING EXISTS IN OTHER JURISDICTIONS SEPARATELY FROM ACCOUNTING BODIES:
4.1. Global best practice examples today indicates a gradual bifurcation between core accounting bodies and emerging forensic and investigative bodies. For instance in most Commonwealth jurisdictions such as Canada and India, forensic and investigative auditing exists as an independent profession distinct from the existing accounting bodies while in the United States , following the enactment of the Sarbanes –Oxlay Act of 2002 in response to the multi-billion dollar accounting scandals at Enron and WorldCom, emphasis is now placed on the need for independence, objectivity and professional scepticism on the part of forensic and investigative auditors. In England, the Institute of Chartered Accountants in England and Wales (ICAEW) established by royal charter in 1880, Association of Chartered Certified Accountants (ACCA), Chartered Institute of Management Accountant (CIMA) exists separate from Chartered Institute of Internal Auditors, founded in 1948 but granted royal charter in 2010. In Canada, the Chartered Professional Accountants of Canada (CPA) established by CPA Act, 1937 exists separate from Canadian Society of Forensic Science, Association of Forensic and Investigative Auditors (AFIA), Canada, and Institute of Forensic Auditors, Canada. In India, the Institute of Cost Accountants, India, Institute of Chartered Accountants, India (ICAI) established under the Chartered Accountants Act, 1949 exists separate from Institute of Forensic Accounting and Investigative Auditors, India. In Scotland, the Institute of Chartered Accountants of Scotland (ICAS) exists separate from the Institute Forensic and Forensic Accountants and Auditors, Scotland. In South Africa, the Institute of Professional Accountants, the South African Institute of Chartered Accountants and Institute of Accounting and Commerce exists separate from the Institute of Forensic Accountants, South Africa. In Australia, the Australian Society of Certified Practicing Accountants Australia and New Zealand exists separate from the Institute of Forensic Accountants, Australia.
4.2. The intendment of CIFIAN Bill is in line with global best practices. There are jurisdictions such as Canada, Belgium, U.K. USA, Germany, Austria, etc., that are operating similar institutes in order to create global focus on training for the present and future generation on how to combat the menace fraud, corruption and cyber crimes which has assumed a high level of technological dimension that is destructive to any economy including that of Nigeria. These countries have fared well over the years in the fight against fraud with the development of high-tech forensic technology in the prevention, detection and investigation of fraud. These countries have also continually review and update their preventive measures and investigative policy to accommodate both private and public forensic and Investigative auditors in order to cope with the rapid growth and sophistication of fraud in private and public sectors of their economies. Nigeria must NOT be left behind, and that is why Chartered Institute of Forensic and Investigative Auditors of Nigeria which is rich with young brains emerged in Nigeria to ensure we return sanity to Nigeria’s economy urgently.
4.2. It is a paradox that Nigeria with the largest economy in Africa and a very high fraud , corruption and cyber crimes index does not have a body with primary mandate for fraud detection, prevention and investigation , whereas South Africa and Zimbabwe which has a formidable institute of Chartered Accountants still has a separate institute for Forensic and Investigative Auditors. In most of these countries it is live and let us live, and no professional body play politics to destroy the other over there, because professional bodies are not politicians, and politics should far from professionalism. That is why they complement each other’s strength rather than pulling down syndrome behaviours as seen in a Nigeria professional body. They belief that the sky is too wide for two birds to fly without clashing. That is why USA, UK and others have upto nine –ten accounting professional bodies different from forensic bodies, yet there is no problem between them, rather the older ones help the younger ones to grow and stabilize for the good of their country. May the almighty God help Nigeria professionals to separate politics from professionalism.
4.3. Forensic in general is an emerging trend, and it was not there any where in the world in early 80s let alone in 60s when some of the law enabling accounting bodies in Nigeria were passed. Therefore no forensic and investigative auditors in Nigeria until the emergence of CIFIAN. It is actually a virgin land that some good Nigerians (Promoter of CIFIAN) decided to cultivate for the benefit of our country. Which means no professional bodies in Nigeria other than CIFIAN can claim ownership of Forensic and Investigative Auditing as it stands now. This verifiable by anybody any time who cares to get the facts.
4.4. It is practically impossible for a professional body to regulate on two disciplines as some professional ICAN is routing to do in Nigeria. This can never be in the interest of Nigeria, but out of self-interest and greed, therefore it should be rejected without fear or favour. It should be noted that the fact that forensic seems lucrative does not mean that anybody can just wake up and start claiming it by all means just because they have been on ground and they have influence. It does not work like that because forensic is completely different from accounting training. It is broad, wide and deep and can not be limited as just a faculty under another body entirely. That is why adequate training is needed before practice to avoid quark, and why CIFIAN is having a consistent training and retraining for its’ members.
4.5. ICAN members have exclusive rights pursuant to the ICAN Act and the Financial Reporting Council Act of Nigeria Act to “practice accountancy in all its ramifications” to the extent that other disciplines such as taxation, information technology, forensic and investigative auditing, consultancy etc are deemed core practice areas of the accountancy profession and ICAN has been training and certifying its members in these so called core areas of the accountancy profession in the last few years. This assertion is not only misleading and false in its entirety but also ultra vires to the restrictive powers of ICAN under section 1 of the ICAN Act (supra).
5.0. CIFIAN MANDATE AND IMPORTANCE OF THE BILL THAT WAS PASSED BY THE NIGERIAN SENATE ON 5TH JULY, 2018 TRANSMITTED TO THE HOUSE OF REPRESENTATIVES IN AUGUST 2018 WAITING FOR CONCURRENCE TILL DATE:
5.1. With respect to the proposed Chartered Institute of Forensic and Investigative Auditors of Nigeria Bill (CIFIAN) which is proposed under the above mentioned bill, it is important to clarify that CIFIAN is neither an accountancy body nor is it coming as a duplicate or triplicate of existing accountancy bodies in Nigeria. We wish to state for the umpteenth time that the primary domain of forensic and investigative auditing is to work within the investigative process from the scene of fraud to the court, providing information and evidence for administration of justice; and to ensure that the courts are presented with the best evidence and reliable witnesses. CIFIAN Bill is necessary to provide the legal framework for the registration, training, regulation and certification of practitioners in the field of forensic and investigative auditing in line with global best practices.
5.2. The core practice areas of the members of the proposed CIFIAN are forensic analysis of financial statements to eliminate material misstatement, whether caused by error or fraud; preventing assets misappropriation scams; cyber crimes, global anti-fraud and corruption compliance and enforcement; litigation support and investigation capacities, preparation of forensic reports, fraud risk management, corporate fraud analysis, fraud prevention, detection and investigation. There are Nigerians who have acquired academic degrees in forensic sciences and would need professional training tailored to Nigerian needs to be able to bring their knowledge to bear on the ongoing anti-corruption crusade..The scope and practice areas for members of CIFIAN under the CIFIAN Bills awaiting CONCURRENCE by the House of Representatives for the past seven months are therefore unique, specialized, novel in depth, topical in nature and crucial in filling an existing huge vacuum in the gathering of forensic evidence arising from concealed financial transactions and documents.
5.3. It should be understood that all over the world, professional bodies exist to entrench excellence, proficiency, discipline and specialization not for mere proliferation as alleged by opponents of the Bill. CIFIAN is coming to fill a huge vacuum in its proposed area of operation, the absence of which Nigeria will continue to spend our scarce foreign exchange to hire expatriate to do forensic auditing in Nigeria as it were in case missing $20 billion in NNPC 2014. CIFIAN is here to provide the services of the much needed forensic experts in Nigeria. No accounting professional bodies in Nigeria has no mandate to investigate fraud, cyber crimes or carry out forensic and investigative audit, and there is law of National Assembly as at the moment that empowers any existing professional bodies in Nigeria to practice forensic and investigative auditing.
5.4. It is equally important to emphasise that forensic and investigative auditing do not feature in the qualifying examination of applicants seeking to become members of accounting professional bodies. These bodies remain stuck with courses only relevant to traditional accounting practice such as basic accounting processes and systems, practice of Financial Accounting, Public Sector Accounting, Quantitative Analysis, Taxation, Financial Management, Cost Accounting with little exposure to the basic principle of auditing which makes such accountant deficient in skills and proficiency required to even function as statutory auditors, talk less of functioning as forensic and investigative auditors which is a specialised area, and multidisciplinary.
5.5. CIFIAN has come to Nigeria at a time like this mainly to train professionals on how to use science and technology to remove opportunity from the fraud triangle thereby making it difficult for the manipulation of accounting facts and figures by Accountants in Nigeria as it were. CIFIAN’s emphasis is on proactiveness and not reactiveness in fraud cases, because prevention is better than cure. Fraud triangle is composed of three legs which are Opportunity, Rationalization and Pressure. Once opportunity to commit fraud is removed from an organisation, it becomes difficult for any fraud to take place no matter to level of pressure. By doing that money will be preserved in government Treasury for infrastructural development.
5.6. The absence of the appropriate legal framework for the regulation of forensic and investigative auditing practice in Nigeria portends great danger to the integrity and safety of the Nigerian financial system. The first noticeable consequence of such a lacuna is that Nigeria currently spends hundreds of millions of her scarce foreign exchange to hire forensic experts to investigate corporate fraud.
6.0. BENEFIT OF CIFIAN
6.1. In Nigeria today, CIFIAN has piloted training on transition to Forensic and Investigative Auditing, and has just flagged off FREE training for all relevant professionals on the use of science and technology for prevention of fraud, corruption and cyber crimes in Nigeria to ensure that sanity is restored as soon as possible. Our emphasis is on proactiveness in fraud cases, seeing that creativeness has not yielded positive result all these years. In summary CIFIAN is on a rescue mission.
6.2. One major advantage that this body would bring to our anti-corruption fight and crusade is that, it will not only partner with relevant government agencies at all levels, but will train their staff on the importance of forensic and investigative auditing for prevention of fraud and deterrence to scare every Nigerians far away from financial misfeasance.
- 3. It will help to strengthen the nation’s institutional frameworks thereby bringing us at par with other developed countries in the world, in line with global standards and competitiveness.
6.4. It will stimulate public confidence, and enhance transparency and accountability in our economic system and our national lives. It will also answer the question often posed by foreign investors as to the safety and guarantee of their direct foreign investments (DFIS) in our country.
6.5. CIFIAN will leverage on the skills already acquired by thousands trained forensic experts in Nigeria and Africa at large, to offer training and retraining of personnel in order to broaden and ensure active participation from various relevant organs of government.
6.6. It will create employment opportunities especially for our teeming young graduates and youths who are roaming on the streets. It will also help to conserve foreign exchange being used to invite expatriate forensic auditors for forensic audit in the country as it were.
6.7. It is going to be a win-win situation from which ever perspective it is viewed, but especially when looked at from the context of judicious application and utilization of scarce resources and a nation like ours that does not enjoy immunity from global recession that is also affecting other nations of the world with more technological advancement than ours.
6.8 .It assist in preserving money in government Treasury for in fractural development that can be used for employing our youth to stop them from going to overseas where they are being killed like animals.
6.9. CIFIAN is to compliment and strengthen the roles of government and corporate bodies in the fight against fraud, corruption and cyber crimes in the country.
6.10. CIFIAN exists principally to assist Nigerian government to preserve our scarce foreign resources always used for inviting expatriate forensic and Investigative Auditors for fraud investigation in Nigeria as it were. To some large extent, it is better and saver for Nigerians who knows the terrain to carry out forensic fraud investigation in Nigeria successfully. It’s high time we patronise made in Nigeria to grow Nigeria.
6.11.With the specialised skills and training, CIFIAN possesses a global mind-set, with Nigerian and African insights, leveraging its local and international expertise and networks of diverse stakeholders, to contribute to meeting Government’s efforts in the task of Section 15(5) of the Constitution (As Amended), with huge potentials for investor confidence with multiplier effects on the growth and development of the economy.
6.12.In recognition of the foregoing, CIFIAN hereby urges Government to ensure the adoption of a statutory framework for effective practice and regulation of forensic and investigative auditing as well as sustain the evolving synergy between Government and CIFIAN in championing the required reforms in extant anti-fraud mechanisms and practices in Nigeria.
6.13. Consequent upon the explanation above, you can agree with us that it is only enemies of Nigeria that would like to play politics with this kind of Bill.
7.1. in rejecting the sustained effort by anybody or group of persons hiding under a so called protection of credibility of accounting profession, we wish to emphasize from the outset that it is the prerogative of the National Assembly pursuant to section 4(2) of the Constitution, item 49, part I of the Second Schedule to the 1999 Constitution of the Federal Republic of Nigeria, as amended to establish and grant parliamentary charter to deserving professional disciplines. It is worthy of note that Nigerian Courts have given judicial recognition to the pre-eminent position of the National Assembly to establish and grant parliamentary charter to professional bodies in the case of Institute of Chartered Accountants of Nigeria (ICAN) v The Chartered Institute of Taxation of Nigeria (CITN), suit No. suit No.M/476/2005 per trial Judge, Honourable Justice Lateefat Okunnu J, wherein ICAN attempted unsuccessfully to have the Bill that sought to establish the Chartered Institute of Taxation of Nigeria ( CITN) to be declared void, the court held that
“The law makers in their wisdom have created a new profession out for tax practice. It is not for the court of law to question them for so doing, nor can the court attempt (by means of its pronouncements) to abrogate this law simply because a particular judge is not enamored of it. As they say in legal circles, sentiments have no place in law. All that the court will do is to interpret laws in such a way as to give them the proper meaning and effect that the law makers intended”
7.2. It is therefore clear that not even the courts can interfere unduly with the powers of the National Assembly to establish and recognize professional bodies except to interpret and give effect to such a law if passed by the National Assembly. The so called media publications here and there against CIFIAN Bill and its’ promoters by the usual Professional body who has decided to hold the whole country into ransom and its cohorts should therefore be disregarded and CIFIAN Bill be treated based on its merits and not based on sentiment considering the likely impact of the Bill on the war against fraud, corruption and cyber crimes in Nigeria particularly as it relates to mining crucial forensic evidence for the successful prosecution of fraudsters in the country. CIFIAN Bill is not in conflict with any existing Act of the National Assembly and therefore should be allowed sail through.
7.3. None of the accounting body in Nigeria has omnibus powers to extend its practice from accountancy into other areas such as forensic investigation, information technology, taxation, limitless consultancy etc in the manner claimed some. According to the Black’s Law Dictionary,8th Edition, accounting means “ the act or a system of establishing or settling financial accounts especially the process of recording transactions in financial records of a business and periodically extracting, sorting, and summarizing the recorded transactions to produce a set of financial records” .
7.4. I wish to state that the scope and practice areas for members of CIFIAN under clause 2 of the CIFIA Bill are unique, specialized, novel in-depth, topical in nature and crucial in filling an existing vacuum in the gathering of forensic evidence, arising from concealed financial transactions and documents. We are therefore taken aback that those opposing the Bill and claiming regulatory responsibility over our prospective members even when ANAN, another accountancy body has expressed its support to the passage of the Bill. They is presently overwhelmed by the regulation of even those practicing “accountancy” so it is inconceivable that it should be overburdened with another responsibility not stipulated under its enabling Law.
7.4. Recognising that prior to the establishment of CIFIAN, there was no Nigerian professional body devoted to the development of idiosyncratic skills in the practice of forensic and investigative auditing; and that functionally, forensic and investigative audit involves skills and micro analytic features that conventional accountants and auditors do not have; They do not have the training and so cannot give what they don’t have. Some of these Accounting bodies are even currently overwhelmed by its’ core regulatory mandate of their members and this explains why the Federal Government and other multinational companies are spending huge foreign exchange on hiring professional forensic and investigative auditors from other countries. Please you are free to consult all enabling Act of the two accounting bodies in Nigeria for clarity.
7.5. From the foregoing, it is clear that the reasons advanced by those against the passage of the CIFIAN Bills are unfounded, misleading and only intended to misrepresent the noble objectives of the CIFIAN Bill. The Bill is about changing the existing anti-fraud mechanisms of early post independent Nigeria which have failed the nation in the war against fraud, corruption and cyber crimes.
7.6. Secondly, it is clear that CIFIAN is not an accountancy body and it is not intended to duplicate the functions of existing accountancy bodies in Nigeria. On the contrary CIFIAN like CITN is opened to people of diverse disciplines including lawyers, accountants, police investigators, judges, criminologists, computer scientists and several others involved in financial fraud prevention, detection investigation and prosecution. CIFIAN proposes to expose its members to the best skills that will enable them function optimally in the prosecution of the war against fraud, corruption and cyber crimes.
7.7. Finally, it should be noted that there is no conflict between the ICAN Act, the Financial Reporting Council of Nigeria and the proposed CIFIAN Bill. Those opposing the passage of the above mentioned Bills have failed to indicate clearly where such conflict exists and our dispassionate reading of the Bills reveals that there is no such conflict.
8.1. Before I conclude, on behalf of the Pro-tem Board members of the CIFIAN, I appreciate the Nigerian Senate under the leadership of Senator Bukola Saraki for the bold step taken in ensuring that CIFIAN Bill was passed based on its merit. Posterity will remember Nigerian Senate. Our appreciation can never be completed without mentioning the senate majority leader, Sen Ahmed Lawal and Sen. Andy Uba who sponsored the Bill and ensure it sailed through. Also are those three Honorable members that introduced the Bill in the House of Representatives which are, Hon. Abonta Uzoma, Chairman Public Complain and petitions, Hon. Kayode Oladele, Chairman Financial Crimes and Hon. Ekoattai Owoidighe Ime from Akwaibom.
8.2. Finally, to avoid quack practice in forensic Audit and investigations in future, we hereby call on the House of Representatives under the leadership of Rt Hon. Yakubu Dogara to treat CIFIAN Bill based on its merit by giving a possible CONCURRENCE to it just as it was done by the Nigerian Senate on 5th July, 2018, and posterity will remember you for doing that. This is necessary now to give hope to the future generation and our children yet unborn. It takes only the enemies of Nigeria to kick against this wonderful innovation that emerged in Nigeria to assist making our economy viable agian.
CIFIAN! CIFIAN!! CIFIAN!!! TRANSPARENCY IN ADVANCED AUDIT
CIFIAN! CIFIAN!! CIFIAN!!! CIFIAN UNSTOPPABLE
Thank you for reading.
Dr. (Mrs.) Enape,
Chartered Institute of Forensic and Investigative Auditors of Nigeria (CIFIAN)
The author of a book titled Practical Step to Forensic Auditing and Fraud Investigation.
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