CHAPTER 1

INTRODUCTION

BACKGROUND
There are a number of positive developments in the economy since the introduction of foreign currency (multi currency system), which if sustained, will spearhead economic recovery in the short to medium term horizon. These developments included the introduction of the multi currency system and the liberalization of the exchange control, the formation of government of national unity (GNU) and the engagement with multilateral institutions and the donor community.

This is already evidence of stability coupled with an increase in industrial capacity utilization since the adoption of multi currency in February 2009.stability is projected to spur growth in the financial, manufacturing and other
c) What is the relationship between statutory audits with corporate governance?
d) What lessons can be drawn from financial scandals that have occurred world over that involve auditors?
e) Is the auditor accountable, whenever corporate governance deficiencies are detected in the company?

1.7 SIGNIFICANCE OF THE STUDY

(a) Theoretical contribution-the study seeks to clearly outline and explain the responsibilities imposed on auditors regarding the establishment of corporate governance
(b) Practical contributions-the study is expected to result in improved reviewing evaluating methodologies that will reduce serious corporate governance in an organization.

Also better assurances are expected to emanate from this study in which the organization’s plans and procedures will be followed and statutory laws and regulations complied with thereby achieving the mission and vision of entities.

The study also aims to highlight possible protection which can be awarded to auditors for liability they may incur in ensuring good corporate governance on which they express a management audit opinion.

There is an expectation that legal costs will drop due to a reduction in litigation as stakeholders no longer waste resources in petitioning against auditors for failing to detect possible serious corporate governance deficiencies and as well as failing to predict future corporate failures.

1.8 STATEMENT OF