INTERNAL AUDIT AND CONTROL FUNCTION AND PROCUREMENT FRAUD IN HIGHER EDUCATION INSTITUTIONS: EVIDENCE FROM AN EMERGING ECONOMY

This thesis investigated the effectiveness of internal audit and control function in reducing procurement fraud in higher education institutions in an emerging economy of Ghana. Ghana is one of the African countries, which is most affected by the cankers of fraud and corruption. Earlier studies revealed that these menaces are most prevalent in the government sector (National Audit Office, 2016). According to the Auditor General’s report of 2018, procurement fraud tops the list after cash and tax irregularities in Ghana (Auditor General’s Report, 2018). This pattern of financial irregularities does not change in the years 2019 and 2020. Various Acts were introduced by the government of Ghana (Internal Audit Agency Act, 658, 2003; Public Procurement Act, 663, 2003; Public Financial Management Act 921, 2016). These Acts were promulgated to augment earlier Acts and to ensure sound public sector financial management. This research aimed at investigating whether the promulgation of Acts 658, 663 and 921 and the establishment of internal audit units have helped in reducing procurement fraud in the public sector. The study used mixed research methods in conducting the investigation with the aim of having supplementary and complementary views from different methods (Descombe, 2013; Cressel2009). The government financial controls were tested both quantitatively and qualitatively. All approaches revealed that the introduction of the financial controls led to adherence and compliance; however, there was very weak effectiveness of government controls, internal audit and controls function respectively, which did not impact much on procurement fraud. The outcomes suggested that given stringent government financial controls, internal controls and internal audit function, procurement fraud rather increases. Keywords: Internal Audit and Control Function, procurement fraud, public financial management, public sector institutions, effectiveness, emerging economies.