THE EFFECT OF MISMANAGEMENT AND EMBEZZLEMENT OF PUBLIC FUNDS: CASE STUDY CAMEROON

ABSTRACT

The effect of fraud on any organization leads to grave consequences in either the public or private sectors. Most misappropriation cases results in serious economic effects on the economy such as loss of fund, assets, revenue meant for current and capital expenditures, and lack of funds for the provision of socioeconomic infrastructure for the public. The issue of misappropriation of fund constitutes a fundamental problem in the public sector. The case of misappropriation and embezzlement of public funds in the Cameroon resulted in the economic recession which led to the implementation some stringent policies by the government. The financial misappropriation of public funds hinders the provision of basic social and economic infrastructures and_ the development of the nation at large. The problem confronting the study is to appraise the effect of mismanagement and embezzlement of funds in the public sector. A case study of two local government areas in Cameroon

CHAPTER ONE

INTRODUCTION

1.1    Background of the study

The Mismanagement of public funds is associated with the misuse and potential loss of funds and therefore raises questions about the integrity of the people in charge of the funds. Misappropriation constitutes a deliberate act of the misuse of money. It is the channeling of money and other assets allocated for a specific official purpose for either personal use or for what it is not meant for. Such action constitutes an unauthorized spending of money or other assets for personal gain. Misappropriation/ is therefore the  highest type of fraud in the public sector as  People  intentionally  divert  public fund for  personal  aggrandizement  without any fear or  negative conscience  (Ibanichuka and Onuoha 2012). The fraud of this type is committed  through the following means; Outright abscorndment of corporate or government assets for personal use.; Payment of salary to ghost workers; Payment for dubious purchase and contract ; inflation of contract prices; The diversion of government funds  into private use; use of office impress for personal allowance; The Unauthorized spending of public funds or asset; making Payment against unclear cheques; The forfeiture of a disease staff gratuity and pension benefits and the Misuse of medical allowances and reimbursements; etc. The effect of fraud on any organization leads to grave consequences in either the public or private sectors. Kiabel (2002). Most misappropriation cases results in serious economic effects on the economy such as loss of fund, assets, revenue meant for current and capital expenditures, and lack of funds for the provision of socio-economic infrastructure for the public. The study seeks to appraise the effect of mismanagement and embezzlement of funds in the public sector. A case study of Cameroon 

1.2   STATEMENT OF THE PROBLEM

The issue of misappropriation of fund constitutes a fundamental problem in the public sector. The case of misappropriation and embezzlement of public funds in the Cameroon resulted in the economic recession which led to the implementation some stringent policies by the government. The financial misappropriation of public funds hinders the provision of basic social and economic infrastructures and the development of the nation at large. The problem confronting the study is to appraise the effect of mismanagement and embezzlement of funds in the public sector

1.3 OBJECTIVES OF THE STUDY

1.3.1 Main objective

The main study objective is to appraise the effect of mismanagement and embezzlement of funds in the public sector

1.3.2 Specific objectives

The specific objectives include

1. To examine if there is any significant relationship between financial mismanagement and national development
2. To examine the effect of financial mismanagement on economic growth

• To ascertain the effect of financial mismanagement on the infrastructural development of Cameroon
  • RESEARCH QUESTIONS

The following research questions were formulated by the researcher to aid the successful completion of the study;

• Main Research question

What are the effect of mismanagement and embezzlement of funds in the public sector?

• Specific Research question

1. Is there any significant relationship between financial mismanagement and national development?
2. Does financial mismanagement have any effect on economic growth?

• Does financial mismanagement hinder infrastructural development?
  • RESEARCH HYPOTHESES

The following research hypotheses were formulated by the researcher to aid the completion of the study;

H₀: There is no significant relationship between financial mismanagement and national development

H₁: There is a significant relationship between financial mismanagement and national development

H₀: Financial mismanagement does not hinders infrastructural development

H₂: Financial mismanagement does hinders infrastructural development

H0; Financial management has an effect on economic development

H3: Financial management does not have an effect on economic development

FURTHER READING: Public administration project topics with materials