The Role of Forensic Accounting in Bridging the Audit Expectation Gap of Microfinance Banks in Akwa Ibom State

The audit expectation gap has widened due to the occurrence of undetected high-profile financial statement frauds, highlighting the need for effective measures to address this issue. This study investigated the role of forensic accounting in bridging the expectation gap among stakeholders in microfinance banks in Akwa Ibom State. Using a survey research design, primary data were collected from 128 respondents representing a sample size drawn from ten randomly selected microfinance banks in Uyo. The data were analyzed using Pearson’s correlation coefficient statistical tool. The findings indicated that incorporating forensic accounting skills significantly mitigates corporate financial fraud by promptly detecting fraudulent patterns that traditional audits may overlook. This highlighted the importance of forensic accounting in addressing the limitations of conventional audit practices. Based on the results, the researcher concluded that forensic accounting practice plays a crucial role in bridging the audit expectation gaps of microfinance banks. To enhance financial reporting quality and stakeholder confidence, it was recommended that microfinance bank directors engage auditors equipped with requisite forensic accounting skills. This proactive approach will enable the early detection and effective mitigation of fraudulent financial reporting, ultimately leading to the production of qualitative financial reports that meet stakeholder expectations.