AN APPRAISAL OF ACCOUNTING INFORMATION SYSTEM AND PROCEDURE IN GOVERNMENT PARASTATALS

AN APPRAISAL OF ACCOUNTING INFORMATION SYSTEM AND PROCEDURE IN GOVERNMENT PARASTATALS

ABSTRACTS

This study, accounting information system and procedure in government parastatals “a case study of Federal Road Safety Commission Abuja” tends to underscore the importance and relevance of accounting system in government parastatals as a whole. Good accounting system enable proper recording of monitor,’ transactions. This aids accountability and transparency in management of tax payers money allocation to this parastatals. Accounting system assists government to properly monitor strict adherence to government polices viz-a-viz the compliance to budgetary allocation to these parastatals. Decisions are made based on the available facts and figures. Timeliness of information processes, accuracy of data collection and consistency of accounting polices adopted help statistical records to enable accurate forecasting of future events for economic growth and developments.

CHAPTER ONE

1.0 INTRODUCTION

Accounting is often said to be language of business, it is used in the business world to describe the transaction entered into by all kind of organization. Accounting terms and ideas are therefore use by people associated with business, whether they are managers, Lawyers, investor, bankers and accountants.

The actual record making phrase of accounting usually called book keeping, so accounting have some for beyond the actual making of records. Accounting is concerned with the use to which these records are put their analysis and interpretation.

Therefore, accounting knowledge is required for proper planning, forecasting, taking vital decision resulting to policies formations in deriving the corporate objective mission and vision of any organization.

It is the concern of this study, therefore to critically examine the procedure and account system for proper management of government assets and liabilities.

1.1  HISTORICAL BACKGROUND OF THE STUDY

The Federal Road safety commission is an origination that was established by the Federal government of Nigeria on 18th February 1988 with the management of chief general staff. Professor Wole Soyinka was appointed the chairman of the council.

Section 10 of the enabling decree establishing the commission requires it to keep proper account in form which confirms with accepted commercial assets and liabilities.

1.2  STATEMENT OF THE PROBLEMS

Various organization operate are system of accounting or the other and the accountants produce the conventional accounting information that is the balance sheet and the profit and loss account to management. There is the problem of some managers thinking they can operate and make decision without the information provided by the accountants and some accountant too think managers cannot take effective decision without the information provided by them. Therefore there is a short of conflict on the relevance or relationship of the decision taken by management and accounting information provided by the accountant.

In addition, some shareholders (both the literate and illiterate) still have the belief that to have a standard accounting department with a qualified accountant in their organization is nothing short of a wasteful exercise.

To these categories of people, accounting only involve the recording of money the comes in and was expanded which they believe anybody or any employee can do with ease. Therefore there is a sort of readiness in the part of these set of people to know the relevance of accounting information system and its procedure in selected government parastatals.

1.3 OBJECTIVE OF THE STUDY

The main objective of this study is to make proper analysis of accounting system and procedures in government parastatals with particular reference to Federal Road Safety Corps in order to determine the extent to problems area is complain with relevant accounting standard, other objectives include the following

To know the effect of the problems in planning and forecasting. How government fiscal policies are alienated with the existing system and procedure to move the commission forward. To suggest solutions / amendment to defective areas in the current system for proper management of the public fund.

1.4 RESEARCH QUESTION

An appraisal of accounting information system and it procedure is a wide topic. Therefore, it become necessary for the researcher to narrow the research case study. The data collected is validity authentic and firm. The organization used as a case study and other related texts.

In order to be able to draw a conclusion on this research postulate some tentative proposition in form of question which when answered will provide or provide that accounting is the basis of all organizational decision making. If the procedure is well followed

The following questions have been considered suitable for this research work.

Does federal road safety commission Abuja have an accounting department and accounting staffs? Does Federal Road safety prepare accounting information? Are the staff professional accountant? Does accounting information system and its procedure applied in the preparation of true and fair view financial statement?

1.5  STATEMENT OF HYPOTHESIS

For the purpose of this study the following hypothesis have been formulated.

H0: Appraisal of accounting information system and its procedure in an organization does not make any contribution in an organization accounting system.

H1: Appraisal of accounting information system and its procedure in an organization make any contribution in an organization accounting system.

1.6 SIGNIFICANCE OF THE STUDY

The study is aimed at knowing the relevance of accepting information system and its procedure in government parastatals. It is also aimed at establishing whether there is correction between the accounting information by the accountant and decision made by the federal Road Safety Commission Abuja.

The parastatals under study that is Federal Road Safety Commission Abuja. Students, management and government The researcher  Students, Management, and government: this write up will serve as a secondary data to future researchers who intend researching on how accounting data or information helps in management decision making generally and as they are been applied in Federal Road Safety Commission in particular. It will also help students especially those in accounting department in having knowledge of the practical application of accounting information to management decision. Federal Road Safety commission Abuja: this study will help the management of Federal Road Safety Commission Abuja in evaluating accounting information system and its procedures and based on the result of the evaluation, take right decision at the appropriate time. The writer up is of immense importance to the research. It will enable the researcher know the problems of finance department in putting together the accounting information also as a staff to the organization, to know whether to come in and possibly have skill knowledge of how accounting information affect management decision.

1.7 SCOPE OF THE STUDY

This research work will cover all aspect of accounting system operating in Federal Road Safety Commission Abuja and the type of information supplied to the management for decision making. It will also incorporate a brief but systematic review of related literature. The research work now also look into the relationship that exist between accounting information system and its procedure. It should be borne in mind that the research of this write up covers only accounting information system and its procedure provided by the accountant to the management of Federal Road Safety Commission Abuja. What is obtainable in other organization might be different from that of Federal Road Safety Commission.

1.8 DEFINITION OF TERMS

BUDGET: is a plan of activities and its financial involvement for a period usually a year.

Advance: Is a payment made a head for the expense of a planned activity.

Financial Statement: This is a report prepared by a bank either to its customers or by an organization to its management/board members explaining the financial position of the business.

Balance Sheet: It is a report that summarized the financial position and the assets of an organization at the end of the financial years.

Liquidation: Is the report of the money advanced for expenses at a given time or period.

Salary: Is said to be a specific amount of money paid to a payment staff of any organization at the end of every month.

Wages: Is money paid to casual workers, pending the hour they put to work.

Loan: Is a borrowed money that usually attract interest, with an agreement to pay back either installmentally for a particular period. It could be long or short term loan.

Payroll: Is used for the preparation of salaries and wages of employees.

Interest: Is small amount of money set aside to meet petty cash payment, the voucher of it can be presented to a sub-accountant immediately.

Finance: Is the management of money in such a way that it could be provided for necessary used and as at when required.

Interest retails additional money added to individual who borrowed money from banks or in work place. The rate normally comes in percentages.

Planning: Is the process of setting organizational goal and objective and means of achieving the objective.

Controlling: Is a process of periodically evaluating actual performance against plan and taking corrective action when result differ from original objectives.

Strategy: Is define as a course of action including the specification of resources required to achieve a specific objectives.

Basic Control: These are control essential for ensuring the accuracy reliability and completeness of accounting record.