ACCOUNTING IN THE NIGERIA PUBLIC SECTOR (ISSUES, PROBLEMS AND PROSPECT)

(A CASE STUDY OF NEPA ENUGU)

By

ONYEMURU FLORA OZIOMA

Presented To

Department of Accounting

ABSTRACT

Today must public sector establishment has been accused of financial recklessness perpetrated by various ministries and parastatals, thus has opened up an can of worms in the bosom of our public sector.

The problem often experienced by operators of government establishment like National Electric Power Authority (NEPA) in maintaining a good accounting system with a view to enhancing accountability is the object of the research work.

However, chapter one deals strictly with the over view of the study in the introduction of the topic, also a brief history of the establishment (NEPA) their target, problems etc.

Chapter two talked about the basis of public sector Accounting, Acts regulating Nigeria public sector Accounting. Financial control in government accounting, comparison between government and commercial accounting, users of public sector accounting and finally some problems were identified.

This research work was carried out through oral interviews and distribution of questionnaires for the collection of data & relevant information from the departments of public affairs and accounts of the National electric Power Authority (NEPA) Enugu. Also information was sourced through secondary data, which includes textbooks, annual report and customer service charter NEPA).

The following chapter death with the analysis of data and testing the formulated questionnaire with chi-square technique.

Finally, the summary of the findings, conclusion and recommendations were discussed.

TABLE OF CONTENT

Cover page

Title page

Certification

Dedication

Acknowledgment

Abstract

Table of Contents

CHAPTER ONE

1.1 Introduction

1.2 Background of the Study

1.3 Objective of the Study

1.4 Statement of Problems

1.5 Research Hypothesis

1.6 Significant of the Study

1.7 Scope and Limitation

1.8 Brief history of the establishment

1.9 Definition of Terms

CHAPTER TWO

2.1 Literature Review

2.2 Basis of Public Sector Accounting

2.3 Objective of Public Sector Accounting

2.4 Nature of Nigerian Public Sector Accounting

2.5 The Scope of Public sector Accounting

2.6 Acts Regulating Nigerian Public Sector Accounting

2.7 Financial Control In Government

2.8 Comprise Between Government Accounting And Commercial Accounting

2.9 Users of Public Sector Accounting

2.10 Some identified problems of Nigeria Public Sector Accounting

CHAPTER THREE

3.1 Research Methodology

3.2 Sources and Method of Data Collection

3.3 Research Population

3.4 Sample Procedure

3.5 Data Technique

3.6 Analysis of Questionnaire

CHAPTER FOUR

4.1 Presentation and Analysis of Data

4.2 Testing & Prove of the Hypothesis

CHAPTER FIVE

5.1 Summary of Findings, Conclusion and Recommendation.

5.2 Conclusion

5.3 Recommendation

Bibliography

Questionnaire used


CHAPTER ONE

INTRODUCTION

1.2 BACKGROUND OF THE STUDY

This historical perspective briefly traces the genesis of government accounting back to the ancient civilization of Babylon, Egypt, China, Greece and Rome as well as to the medieval civilizations of Europe up to the colonial experiences of Nigeria in the early 20th century.

i. ANCIENT BABYLON: The temples and government of Babylonian Empire (3000 BC to 300 BC) employed hundreds of scribes as administrators. Supervising temple accounts on a great mass of tablets" describe a variety of receipts and disbursements, wage payment, rental income, interest on loan, and real estate transactions. Both the temple and the royal treasury sent scribes to distant parts of the Empire as collectors of taxes and tributes. These men incurred traveling expenses for which they were later reimbursed. Tithe and property taxes were normally paid in kind. periodically the scribes prepared inventory of assets on hand. Evidences of royal examination and audit exist (Keister 1963).

ii. ANCIENT EGYPT: By about 5000BC the two Kingdoms of upper and Lower Egypt were founded. They were united under Menes regarded as the first Pharaoh around 3500BC with capital at Memphis for several centuries all the land was owned by the king and the nobility. The district governors called nor March's were responsible for the collection of taxes in the "nomes" (that is district) under their jurisdiction. These were paid in kind since stamped money was unknown among the Egyptians till about the 4th century BC.

Government Accounting in Egypt was enhanced greatly by the introduction of papyrus as a writing material as it made record keeping less camber some and permitted a widen use of supporting documents. The storehouse bookkeepers were very meticulous in documenting receipts into and issues out of the stores. Nothing left the treasuring without a documented authority. Extra security was provided by an elaborated internal control system, which required that the records of one official agree with those of another. Royal storehouse superintendents audited accounts and fraud was punishable by torture and death (Chatfield, 1977:7).

iii. CHINA: Government Accounting reached a peak of sophistication in the Chinese civilization during the Chao Dynasty (1122-256BC). That level of sophistication was hardly exceeded before the emergence of double entry system. The hub of Chao's government agencies.

The Grard Treasury authorized all expenditures and prepared summaries of receipts and payment at the end of each fiscal year. The dynasty prime minister had overall responsibility for the budgetary process and for on site the detail of both functions were delegated to the office of the controller general. The Chao's dynasty unproved upon the concepts of financial administration and public accountability inherited from its predecessors particularly Hsia dynasty (2206-1766BC) and Shang Dynasty (1766-1122BC). Every government agency was expected to prepare an annual report on its accomplishments and these were audited by the office of the Controller-General (FU, 1971).

iv. GREECE: Owing to its democratic set-up, the citizens of Athens of the 5 th century BC possessed real authority over government finance. Expenditure levels were statutorily fixed and controlled. Members of the popular assembly sponsored financial legislation and controlled the receipts and disbursement of public money. Ten state accountants chosen by lot, recorded revenue inflows and complied the list of government debtors (Chatfield 1977:9).

Public financial disclosure was mandatory, thus the records of public holders were examined by government auditors at the end of office and thereafter published. The finance of Greek temple-treasures were controlled by the state, not by the priests. Untouchable reserves for public emergencies were built up by dedicating surplus funds to the gods. However, the most important Greek contribution to public sector accounting was the discovery of coinage by about 630 BC.

v. ROME: Roman government and bankers account began as an extension of financial documentation ordinarily maintained by households. Family receipts and payments were recorded on daily basis in an "adversarial" or daybook and posted at the end of the month to a "Codex accept et expense" which was in effect a cashbook. Household accounts were required under Roman law to support tax payments and to disclose the family wealth upon which a citizens civil rights depended to some extent.

The Roman senate acting in the name of the people, controlled coinage and public finance under the republic. The power to order payments was initially delegated to the consuls, but in 443BC was transferred to the consors, who thereby assumed overall change of the nation's financial administration. Receipt & payment were made the responsibility of a small group of quarters that managed the treasury, paid the army, and supervised the government bookkeeping. Under their direction clerks kept day books comparable to the family. "Adversarial" which were summarized on monthly basis in the "Codex". A register of debtors referred to as a "columbarium" was also compiled. A government official supervised by the treasurer audited public accounts. At the end of their tenure of office the quaestor were required to render accounts to the senate and to the their successors.

Tulius Caesar exercised personal supervision over the treasuring, and emperor Augustus completely revamped this operations. Augustus introduced annual budgeting aimed at coordinating the Empire's fiscal activities, limiting expenditures to the amount of estimated revenues and enforcing better control at the various levels.

vi. ENGLAND: Government accounting in Britain emerged in the Middle Ages. Early government tax rolls and manorial account books are among the oldest surviving documents in the English language. After the invasion of England Williams the Conqueror took the tithe of all properly in the name of the Crown and 1086AD had a survey made which included all real properties and the taxes due on them. The survey was documented in the Domes daybook. From this book, the great roll of the exchequer, otherwise referred to as the pipe roll was compiled. Beginning in 1130AD, the pipe roll provides 700-year narrative description of rent, fines, taxes and other levies due to the British Crown, together with a summary of payment made on these debts and expenses incurred in collecting them. The sheriff was collected of the king's revenues and bailiff of his country estate, which were farmed out for a fixed rent. The sheriff collected rent for the use of road, forest and fields, town, fine penalties and other taxes. He was the chief executive accountable at the exchequer. Twice per year the sheriff of each country was summoned to attend the exchequer session at Westminster. There he rendered his account and necessary reconciliation was made. When all the crown's counters were balanced by payments, tallies and allowances vouchers, the sheriff was required to swear to the Marshall of the exchequer that he had made his lawful account according to his conscience and thereafter released to returns to his country (Chatfield, 1977:21-24).

The origins of English Budgeting are closely associated with the long struggle to democratize taxation. The bill of rights of 1989 provided for the parliamentary consent before any one may be taxed. During the 18 th century, parliament required the crown to prepare annual estimates of all other government departments. It became an accepted practice for the Chancellor of the Exchequer to deliver to the parliament, on behalf of the king, a comprehensive report on national finances at the beginning of each fiscal year. Having taken over the king's taxing and spending power, parliament faced the task of holding officials at all levels accountable for their use of public funds.

In 1785 an act for the better examining and auditing of the public account as passed to ensure a rigorous examination of the accounts of every department of government. This was followed in 1787 with the passage of the consolidated fund act, thus providing an overall basis for accountability via a general fund through which all government revenue and expenditure passed.

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