THE NEXUS BETWEEN BENFORD’S FIRST DIGIT LAW AND RECEIVABLES OF NIGERIAN LISTED OIL AND GAS COMPANIES

The global rate of fraud in organizations is alarming.  Managers and employees have continued to create a complex means of fraudulent activities that is very difficult for the auditor to detect using the traditional method of auditing. Therefore, there is an urgent need to introduced Benford’s Law an analytical tool for effective investigation and detection of fraud in accounting data. The objective of this paper is to determine the significant relationship between Benford’s First Digit Law and Receivables of listed Nigerian oil and gas companies.  To achieve the objective of the study, Chi-square test was employed to determine the significance of the relationship between the two variables of interest. The result shows that there is no significant relationship existing between Benford’s First Digit Law and Receivables of list Nigerian oil and gas companies. The implication of the finding is that there is error and fraud in the receivables data provided in the financial statement of listed Nigerian oil and gas companies. The study recommends among others is the continue application of Benford’s Law to detect fraud in listed organizations in Nigeria.