AUDITORS’ ROLE IN FINANCIAL STATEMENT FRAUD PREVENTION AND REPORTING QUALITY IN NIGERIAN NOT FOR-PROFIT ORGANIZATIONS: EVIDENCE FROM NATIONAL AGENCY FOR THE CONTROL OF AIDS (NACA)

Abstract

This study investigates the role of auditors in financial Statement fraud prevention in not for
profit organization in Nigeria: by taking audit assertions and evidence to enhance financial
reporting quality , using the National Agency for the Control of AIDS (NACA) as a case study.
The research examined how auditors’ compliance with international audit standards, audit
planning and execution, and risk assessment/internal control systems influence three key
dimensions of financial reporting quality: relevance, faithful representation, and
comparability. The study adopted a descriptive survey design and employed a purposive
sampling technique to gather data from 70 audit and finance professionals affiliated with
NACA. A structured questionnaire was used to collect primary data, which was analyzed using
SPSS for reliability testing and E-Views for regression analysis. The Ordinary Least Squares
(OLS) results revealed that each auditor role had a statistically significant positive effect on its
corresponding reporting quality dimension. Specifically, compliance with audit standards
enhanced relevance, audit planning improved faithful representation, and risk assessment
strengthened comparability. The findings underscore the strategic importance of auditors not
only in preventing fraud but also in promoting the credibility and usefulness of financial
information in non- profit organizations by taking audit assertions and evidence to enhance
financial reporting quality. The study contributes to literature by contextualizing audit
practices within a donor-funded Nigerian agency, and it recommends stronger adherence to
international standards, risk-based audit approaches, and capacity development for non -profit
organisation focused auditors.