The Indispensability Of Accouting System In The Control Of Public Expenditure

Accounting Project Topics

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This project titled “the Indispensability of accounting system in the control of public expenditure (A case study of federal radio corporation of Nigeria, Enugu National Station) is seemingly an important study. this study is very essential especially in the present  day where most establishment whether public or private are characterized by reports on increasing cases of fraud and misappropriation of finds. This research work aims discovering whether improper accounting system to a large extent contribute to cases of fraud and misappropriation of funds. Other cases of fraud and irregularities among government officials, would also be looked into. The research solution will help curb these anomalies in the government parastatals and these would be continued in a chapters project write up.










Title page                                                                        i

Approval page                                                                 ii

Dedication                                                                       iii

Acknowledgement                                                           iv

Abstract                                                                          v

Table of content                                                              vi


Introduction                                                                    1

1.1      Background of the study                                        6

1.2      Statement of problems                                           7

1.3      Objectives of the study                                           9

1.4      Significance of the study                                        10

1.5      Scope and limitation of the study                          11

1.6      Limitation of the study                                           12

1.7      Definition of terms                                                  12

1.8      Research questions                                                14


Literature review                                                            16

2.1      The public sector                                                    16

2.2      The concept of accountability                                 17

2.3      Accounting in public sector                                    20

2.4      The indispensability of accounting

government corporations                                       22

2.5      Setbacks inherent in government accounting

in Nigeria                                                                26

2.6      Internal control of public expenditure                   29

2.7      The audit of the corporation                                   31

2.8      Budget and budgeting control                               34

References                                                              36


3.0   Research design and methodology                         37

3.1      Research method                                                    37

3.2      Sources of data                                                       37

3.3      Questionnaire design and allocation                     38

3.4      Research population                                               39

3.5      Sample size determination                                     40

3.6      Validation of instrument                                        40

3.7      Reliability of the instrument                                  40


4.0   Presentation and analysis of data                          42

4.1      Analysis and interpretation of responses              42


Summary of finding recommendation                            55

5.1      Summary of finding                                                55

5.2      Conclusion                                                              56

5.3      Recommendation                                                    58

Questionnaire                                                         62





Table one:       Response rate                                         42

Table Two:       Question One: Do not agree that

proper accounting is essential in the

control of public expenditure?               43

Table Three:    Question Two: Does efficient

internal control system assist

in the prevention of errors and fraud

in the activities of the corporation.        44

Table Four:     Question three: Do you agree that

qualified and experienced accountant

is necessary for the enhancement

for the accounting department?             45

Table Five:      Question four:How regular Audit?                46

Table Six:        Question Five: How do you consider

 the strength of internal audit in

this corporation?                                    47

Table Seven:   Question six: What in your opinion,

do you think is responsible for

increasing cases of fraud

 and misappropriation of fund

 in government parastatals.                   48

Table Eight:     Question seven: Which of these

do you think would achieve

better management of public funds.      49

Table  Nine:     Question eight: Which of these in

 your opinion are the weakness/

setback inherent in the accounting

system of government parastatals         50

Table Ten:       Question Nine: What do you think

is the general altitude of Nigerians

towards their job as government

 employees?                                            52




Accounting is the language of business that can tell with reasonable accuracy the degree of success an organization has achieved in approaching its financial goal of profit. Accounting system can be defined as records, procedures and equipment that routinely deal with the events affecting the financial performance and position of the organization, (Horngren and Foster, 1975). The accounting system entails repetitive voluminous transaction which generally falls into cash disbursement, cash receipts, purchases and sales, services including employee payroll. The purpose of accounting system is to provide an orderly method of  gathering and organizing information about the various business transaction so that it may be used as an aid to management in operating the business (cope land and Dascher, 1978). Small scale enterprises have been defined in  various ways according to the capital of the enterprises, size, the number of people employed by the enterprises, the ownership and management of the enterprises and sale volume. Small scale enterprise according to Omorodion (1987) are very important to nations. They are catalysts for industrialization. This is because they provide raw materials for medium and large scale enterprise. They also provide employment opportunities for large segments of the population. For the small scale enterprise to efficiently play the mentioned roles they should be an orderly method for gathering and organizing information about the various business transaction. This can only be done by the use adequate accounting system.

Basically, they are two types of accounting system commonly in use, namely, single entry and double entry system. These could be operated manually or computerized (Baumback, 1983).

The single entry accounting system according to Osuala (1995) is the easiest accounting system to operate. The system recorded the flow of income and expenses through the business on daily summary of cash receipts, a monthly summary of cash disbursement. In single entry book-keeping there might be single aspects of certain transactions and no record at all of some. Generally, there are rough records of cash received and paid and of sundry debtors and creditors. Transactions are exchange of values. For every value received, there is an equal value parted with. It is obvious therefore, that a transaction has a double effect. Receiving of value and giving out value. This method is known as double entry book. Keeping method, double entry book keeping according to Passion (1989) does not mean recording twice but instead, it means that every entry recording twice but instead, it means that every entry or recording of transaction has two parts, a left side and a right side. The left side in the accountant’s language is a debit and the right side, a credit when applied to a transaction. The value received is a debit and the value parted with a credit. Whereas considerable amount of studies have been conducted on financial and management of small enterprises. Osuala (1993) reported that generally many of these enterprises recorded their transaction randomly without adherence to any established systems of accounting, hence, there is deficiently in keeping tract of the cash flow in the enterprises. Mitchel et al (2000) argued that accounting information could help the small scale enterprises manage short term problems in such areas as costing, expenditure and cash flow by providing information to support monitoring and control knowledge cash flow according to Pandy (1991) is very important because cash flows are inseperable parts of the business operation of all firms. Paren and Grant (2000) noted that decision making processes in small scale enterprises are more sophisticated than anticipated but they lacked effective accounting information and control system to support their decision. Furthermore, the international  federation of Accountants (2006) reported that there is evidence to suggest that small firms are aware of the importance of accounting information. Inspite of this awareness most proprietors of small enterprises in Nigeria most times are not too keen to use standard accounting system to run the day to day activities of their enterprises. (Ofonagoro, 1983), the high rate of failure of small scale enterprises in developing countries like Nigeria, has generally been traced to poor management and accounting system employed by these enterprises. The purpose for these study, therefore was to identify the accounting system in use in small scale enterprise in Enugu, South East Nigeria with a view to determine adequacy of such system(s) and recommend remedies needed for enhancement of accounting information system in optimization of the operation of these enterprises.


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The Indispensability Of Accouting System In The Control Of Public Expenditure