TITLE:
Impact of Forensic Accounting on Internal Control Effectiveness and Fraud Prevention in Nigerian Public Sector
AUTHORS:
Aloysius Vutumu, Omo Aregbeyen, Ademola S. Akinteye
KEYWORDS:
Internal Control System, Forensic Accounting, Fraud Prevention, Vutumu Forensic Accounting Theory (VFAT), Committee of Sponsoring Organizations of the Treadway Commission (COSO), Nigerian Public Sector
JOURNAL NAME:
Journal of Financial Risk Management,
Vol.14 No.4,
December
23,
2025
ABSTRACT: Widespread fraud in Nigeria’s public sector continues to undermine public policy and distort resource allocation, despite the implementation of internal control systems. Although forensic accounting is recognized as a vital tool for combating fraud, its impact on internal controls remains underexplored. This study examines the impact of forensic accounting on internal control systems, with a particular focus on fraud prevention in the Nigerian public sector. The study used a descriptive cross-sectional survey with structured 5-point Likert questionnaires to collect quantitative data from finance, accounting, control, and management staff across 43 ministries, 42 agencies, and state anti-fraud institutions. Using purposive and random sampling, 385 responses were analyzed. Reliability was tested with Cronbach’s Alpha, and Partial Least Squares Structural Equation Modeling (PLS-SEM) assessed forensic accounting’s role in strengthening internal controls for fraud prevention. Findings show internal control positively relates to fraud prevention (β = 0.156), and forensic accounting strongly predicts fraud prevention (β = 0.407). Importantly, forensic accounting mediates the relationship between internal controls and fraud prevention (β = 0.072), although no significant moderating effect was observed (β = −0.04). These results demonstrate that forensic accounting enhances the effectiveness of internal controls by translating control structures into practical fraud prevention outcomes. The study supports the extension of the Vutumu Forensic Accounting Theory (VFAT) model by highlighting forensic accounting as a key complement to internal controls, while emphasizing the importance of further research, policy initiatives, and targeted training to strengthen forensic accounting practices across organizations.