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Author(s): Job Boahen, Evans O. N. D. Ocansey (Ph.D.), Boachie Danquah.

Volume/Issue: Volume 9, Issue 2 (2026)

Page No: 146-166

Journal: African Journal of Accounting and Financial Research (AJAFR)

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Abstract:

Procurement fraud continues to undermine public financial management and accountability in many developing countries, especially within local government institutions where procurement activities constitute a significant proportion of public expenditure. Though forensic auditing has emerged as an important mechanism for fraud detection and prevention, its effectiveness may depend on organizational conditions that facilitate the implementation of audit recommendations and accountability measures. This study investigates the mediating role of organizational culture in the relationship between forensic audit activities and procurement fraud within Ghana’s Metropolitan, Municipal, and District Assemblies (MMDAs). The study employed a quantitative cross-sectional survey design. Primary data were collected from 343 finance directors, accountants, and internal auditors selected from Ghana’s 261 MMDAs using a structured questionnaire. Data were analysed using descriptive statistics, Spearman correlation analysis, and Partial Least Squares Structural Equation Modelling (PLS-SEM). The findings reveal that forensic audit activities are largely absent within Ghanaian local governments, with mean scores ranging from 1.68 to 2.60 on a six-point scale. In contrast, perceptions of procurement fraud remain relatively high (M = 3.45), despite the existence of formal procurement procedures and qualified procurement personnel. The results further show that organizational culture significantly mediates the relationship between forensic audit activities and procurement fraud (β = 0.270, t = 5.794, p < 0.001), accounting for approximately 47.8% of the total effect. Specifically, transparency and ethical leadership enhance the effectiveness of forensic auditing by facilitating information accessibility, accountability, and the implementation of corrective actions. The study concludes that forensic auditing alone is insufficient to curb procurement fraud unless supported by a strong organizational culture characterized by transparency, accountability, and ethical leadership. The findings demonstrates that organizational culture constitutes a critical mechanism through which technical audit interventions influence fraud-control outcomes. The study offers important policy implications for strengthening anti-corruption frameworks and improving public financial management within decentralized governance systems.

Keywords:

Forensic auditing, Procurement fraud, Organizational culture, Transparency, Tone at the top, Public sector governance, Ghana’s MMDAs.

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