The need for cost audit in enhancing reliance in the disclosed operational performance of organisations: The case of Nigeria

In the present global business environment, cost reduction application has led to enhancing organisational value for many notable firms. However, in Nigeria, the situation is pathetic as companies incur high operational costs, in view of this reason, unit selling prices for most manufacturing outfit, including those of the market leader firms, are considered  exorbitant. This work, therefore, focuses on the instrument that can be applied to curb the excessive cost and to enhance organisation value. The research makes use of both primary and secondary sources. In ensuring high validity of the primary data, questionnaire and interview methods were employed. The interviews and questionnaires were directed to some reputable manufacturing organisations in Nigeria, audit firms, retailers and selected investors in the public. The major finding revealed that, cost control system adopted is found not reliable and the conventional external audit assignment is not sufficient to rely on the disclosed operational performance of organisations in Nigeria. Based on this major finding, it is suggested that, there is a need for the government to introduce cost audit task in the public limited liability organisations and those of the government established commercialised and privatised companies in order to improve performance.   Key words: Cost audit, performance audit, propriety audit, operational performance.