ANTI-MONEY LAUNDERING AND COMBATING THE FINANCING OF TERRORISM: IS THE ACCOUNTING SYSTEM EFFECTIVE

The study achieved its objective of evaluating the contribution of accounting practices to AML/CFT compliance, analyzing their integration with regulatory frameworks, and assessing the impact of accounting standards and audits on AML/CFT effectiveness in Nigeria. It also explored systemic challenges and provided actionable recommendations to improve financial transparency and resilience against financial crimes. A cross-sectional design was employed, focusing on professionals from Nigeria’s financial and regulatory sectors. The study involved 150 respondents sampled using stratified random sampling. Data collection was conducted through structured questionnaires and analyzed using descriptive and inferential statistics. The regression analysis revealed that accounting standards and audits collectively explained 51.8% (R² = 0.518) of AML/CFT effectiveness, with a significant model (F = 9.32, p < 0.05). However, the individual effects of audits (t = 1.417, p > 0.05) and standards (t = 1.207, p > 0.05) were not statistically significant, emphasizing the need for a combined implementation strategy. The study concluded that integrating robust accounting systems with regulatory mechanisms is crucial to enhancing AML/CFT compliance and addressing financial crimes effectively