Effects Of On–Line Banking On External Audit And Banks\' External Examination In Nigeria

Abstract

The deregulation of the banking sector in Nigeria in 1986 brought far- reaching transformation through computerization and improved bank service delivery. Apparently, the banking industry and bank examiners in particular can curry gains from harmonization/standardization of software in the financial system. Although the need to continually update and sharpen technical skills of external auditors and bank examiners cannot be over emphasized, the situation would be assisted if the banks could collaborate with one another in terms of choice of banking application. Also on-line banking business in developing economies like Nigeria holds high potential in the financial environment. Given the appeal of information technology in enhancing service delivery, it is important for regulatory authorities and examiners to upgrade their processing and monitoring systems to align with the private sector banking innovation pace. This paper presents the effect of on-line banking on external audit and external examination of Banks in Nigeria. Although the paper has shown that on-line banking presents such benefits as speedy account balances retrieval, quick funds transfer, rapid transformation of the quality of service delivery in the banking sector and the economy, improvement in the living standards of citizens and fascinating reduction in fraud (especially advanced fee fraud), it remains to be confirmed that on-line banking does not actually pose possible susceptibility to money laundering and other financial crimes or facilitate their easy perpetration.

Keywords: On – Banking; External Audit; Information Technology; Nigeria.

Global Journal of Social Sciences Vol. 7 (1) 2008: pp. 27-32