Abstract
Research Purpose: Amidst rising concerns about corporate integrity, this study investigates the impact of financial statement fraud on the financial performance of manufacturing industries in Nigeria, using Cadbury Nigeria Plc. as a case study. Understanding these fraudulent activities is critical for improving corporate governance and financial transparency.
Methodology: The study analysed secondary data from Cadbury Nigeria Plc’s financial records spanning 2004 to 2023. Trend analysis was employed to detect significant changes in financial performance due to fraud, focusing on incorrect asset recognition and improper expense recognition.
Findings: The analysis reveals that financial statement fraud, driven by both internal and external factors, significantly undermines the company’s financial performance. Fraudulent practices distort the financial health of the company, misleading shareholders, creditors, and regulatory authorities.
Conclusion: The study concludes that financial statement fraud has detrimental effects on the financial performance of manufacturing companies. Effective corporate governance is essential to mitigate these risks and ensure accurate financial reporting.
Recommendations: Businesses should implement robust monitoring and control mechanisms to detect and prevent financial statement fraud. Strengthening corporate governance practices is crucial to safeguarding the interests of shareholders and maintaining financial transparency.
Key words: Financial Statement Fraud, Incorrect Asset Valuation, Asset Valuation Fraud, Business combination fraud, Biological Assets.
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