THE MODERATING EFFECT OF INTERNAL CONTROL SYSTEM ON THE RELATIONSHIP BETWEEN FORENSIC AUDITING TECHNIQUES AND FRAUD MITIGATION EFFICACY IN LISTED COMMERCIAL BANKS
Abstract
The study evaluated the moderating effect of internal control system on the relationship between forensic audit techniques and fraud mitigation efficacy in listed commercial banks. The study focused on listed commercial banks in Kenya. The research was grounded in the fraud diamond theory, offering a comprehensive framework for understanding fraud dynamics. The study adopted a positivist philosophy and both descriptive and explanatory research designs, the study targeted forensic auditors, internal auditors, compliance officers, and bank managers using a census approach. Data was collected via structured questionnaires and analyzed through inferential statistics with aid of SPSS. Inferential statistics contained correlation analysis and regression analysis. The study results indicated that internal control system has a positive and significant moderating effect on the relationship between forensic audit technique and fraud mitigation efficacy. Overall, the findings suggest that optimal fraud mitigation in commercial banks is achieved by integrating strong internal control systems with forensic auditing techniques. Findings may guide banks, regulators, and policymakers in adopting forensic techniques more strategically, thereby strengthening fraud risk management, safeguarding institutional integrity, and enhancing financial sector stability.
JEL: M42, M41, K14
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DOI: http://dx.doi.org/10.46827/ejefr.v10i4.2237
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