An Analysis of Effects of Forensic Auditing in Detecting Fraud in State Owned Enterprises: A Case Study of ZESA

Abstract

Purpose: In order to ensure effectiveness in State Owned Enterprises, (SOE) forensic auditing significantly plays a huge role in the detection and prevention of fraud. State owned Enterprises play a big role in any country as they provide commercial services or activities to the public. Their business involves transacting huge sums of money in their day to day operations. The state has significant control through full, majority, or significant minority ownership. There are fraudulent activities occurring in these enterprises as a result of poor controls in these organizations, hence forensic auditing plays the role. The purpose of the study was to examine how forensic auditing services aid in fraud detection in State Owned Enterprises. Methodology: Quantitative research methodology was adopted and questionnaires were used to collect data. Findings: The results indicated that forensic auditing has a significant positive correlation relationship in fraud detection in SOEs. Originality/Value: Forensic auditing although used by ZESA, is not being effectively implemented to detect and prevent fraud.