The write – up looks into “bank distress, nature and cause, implication and associated auditor’s responsibilities”. The importance of banks in the economy cannot be over emphasized bank occupy a critical place in a complex financial system that supplies the money and credit needed for the economy. The development of banking system is seen by both the banking institutions and non – banks financial institution as a critical factor in economic development.

However, the ability of banks to promote growth and development depends on the extent to which financial transactions are carried out with trust and confidence and least risk.

Auditors have the responsibility of examining the book of account of any given company or establishment and express their views on the truthfulness and fairness of the accounts whether properly accounting record have been kept by the company and whether the company balance sheet and its profit and loss accounts is in agreement with the company records and returns.

It is this auditing role of the auditor that breeds the trust and confidence that banks need meanwhile. Public confidence and trust in the banking system way be shaken by banks failures with adverse consequence on the development process thus, the critical importance of banks in economy growth and development explain why each economy takes serious view of their failure.

1.1 STATEMENT OF RESEARCH PROBLEM

Not withstanding the important and efficiency on any organization there are always some deficiency which need some corrective measure to effectively achieve the overall aim of the organization.

· Fraud is one major problem which faces the banking sector. Most bank distresses are cursed by frauds either from customers or from internal factors e.g. Auditors, managers, accountants etc.

· One of the problems of the Nigerian financial system is that of lack of inadequate legal regulatory framework for an effective regulation and supervision of the banking system as well as non bank financial institution.

· Also, some commercial banks are run as personal enterprise. In such cases the proprietor makes drawings as and when he pleases, which eventually result in lack of capital and distress.

Furthermore, records are sometimes not properly kept and accounts not properly balanced, all these bring about inefficiency.

Therefore, this research project is going to loss at bank distress:

· Nature

· Causes

· Implication

· Investigation

If these responsible for bank failure a be tried in the failed bank tribunal and punished according.

1.2 OBJECTIVE OF THE STUDY

· To examine the role of auditors in the audit of banks

· To asses forms of bank distress.

· To examine the causes of bank distress

· To show the implication bank distress to the economy

· To determine if the external auditors are label for distress of their chain bank

· To recommend remedies to current bank distress

1.3 SIGNIFICANCE OF THE STUDY

The choice and design of this research work has been made in such a way to educate and inform all and sundry, most especially e.g.

· Bank

· External

· Auditors

· The general public

· Further researchers

Bank

Bank sectors should assume its role in the growth and development of the economy

External auditors

This will help them to determine the scope of the organization by a given sector

The general public

This will help them to unable over bank distress

Further researcher

This project topic is open to further research and further researcher could use this project work as a point of reference for consultations

1.4 SCOPE OF THE STUDY

As explained earlier, this project seeks to know the problem of bank distress: nature, cause, implication and associated auditor responsibilities. This will however be discussed in relations to the banks.

The gener4al concept therefore, is the problem confronting the bank distress and the method of resolving those problems.

1.5 LIMIATION OF THE STUDY

Based on the importance of the write up, it would have been imperative to obtain information from a wider segment of the economy. So many factors are responsive for the limitation of this study, they are as follows –

Financial constraint

As a student there was not enough capital to spend in transport and fact finding and borrowing of necessary literature that would have helped in the writing of the research work.

Management constraint

The respondent, especially the branch manager, did not co-operation as was expected. Also this workers in the different department visited were as well reluctant in answering some of the question asked.

Time constraint

In a study of this nature, one would like to accumulate data from areas. But, in view of length of time allowed for this research such a wide range sample study was external difficult. This research work was therefore concentrated its field work in Enugu metropolis.

1.6 DEFINITIONOF TERM

Auditing

This is defined as an examination investigation, and an exercise carried out aon a statement of account which have be4en prepared to check the truthfulness of the transaction recorded.

CC NWABUEZE 2004/ 2005

Auditor

This is define as a impartial critic appointed to verify financial or other statement of account and to satisfy himself that statement exhibits a correct view of the affairs of the biz or organization concerned.

BASIC AUDIT PRINCIPLE BY C.C NWABUEZE

Internal auditor

This is the independent appraisal activity within an organization for the review of the accounting, financial and other operation as a basis for protective and constructive service of management.

BASIC AUDIT PRINCIPEL BY CC NWABUEZE

Bank distress

When a bank is unable to meet the Bank examination system (came) is clarified as being distressed.

JOHN ORJIH 2003 / 2004

Fraud

This is used to refer to irregularities involving the use of criminal deception to obtain an unjust or illegal benefit. Elements of baking by

JOHN ORJIH

Bank fraud

This is defined as a conscious or deliberate effort at obtaining unlawful financial advantage at the detriment of another person who is the rightful owner of the fund.

ELEMENT OF BANKING BY JOHN ORJIH