ACCOUNTING SYSTEM OF COOPERATIVE SOCIETIES, A CASE STUDY OF OTA LGA

TABLE OF CONTENTS

CHAPTER ONE

1.0     INTRODUCTION        

1.1     BACKGROUND OF THE STUDY 

1.2     STATEMENT OF THE PROBLEM

1.3     OBJECTIVES OF THE STUDY     

1.4     RESEARCH QUESTIONS

1.5     SIGNIFICANCE OF THE STUDY 

1.6     SCOPE OF THE STUDY

1.7     LIMITATION OF THE STUDY

1.8     DEFINITION OF TERMS     

CHAPTER TWO

2.0     LITERATURE REVIEW

CHAPTER THREE

3.0     RESEARCH METHODOLOGY

CHAPTER FOUR

4.0     DATA ANALYSIS

CHAPTER FIVE

5.0     SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATION

REFRENCE

APPENDIX

CHAPTER ONE

1.0            INTRODUCTION

1.1 BACKGROUND STUDY

A cooperative society is non-profit oriented organization whose sole purpose is to take care of the needs of the members. Cooperatives are socio-economic organizations. They are founded on the principles of equity and equality. Their decisive aim is to effect social advancement through economic improvement. The success or failure of a cooperative is, therefore, adjudged by its economic performance and its social thrust on the community it serves. The economic performance of the cooperative has to be studied, measured and reported to the members, financing banks, higher level institutions and to the state government. This, in fact, is a statutory requirement and has to be done every year without failure and omission.

The economic performance or efficiency of the cooperatives can be ascertained and understood by recording, classifying and summarizing the business transactions in a significant and systematic manner. The system designed to perform all these tasks is accounting. Measurement of the economic performance is not the only end of accounting.lt has to provide accurate and timely information to facilitate decision-making. In fact, the role of accounting information in decision-making becomes crucial, critical and all- important as cooperative organizations become increasingly complex, hierarchical and decentralized. In other words, the demand for management accounting in cooperatives has been gradually increasing.

A key challenge facing co-operatives and credit unions is to develop an excellent practice co-operative accounting system that provides a set of measures to account for how credit unions and other co-operatives use their resources to meet all of their core goals, including measures of what constitutes a financially healthy organization that can sustain itself.

This co-operative accounting system should allow the co-operative to achieve transparent and open reporting to the board, membership and community. Finally, it should provide management with the measurement tools they need to manage the co-operative on behalf of the members.

1.2     STATEMENT OF THE PROBLEM

Histories of various research have shown that poor improve management and accounting system has been the main cause of the problem of some various cooperative business enterprises, using the early cooperative society as an example, their major problems were characterized /associated with poor management and lack of good accounting record keeping. The abuse case of some

voluntary cooperative officers (They practice voluntary

unpaid management) has been identified as the effect of poor management and inadequate accounting system.

The reasons identified for the poor management and accounting system in the various cooperative societies are presumed to be lack/inadequate training and experience necessary for managing of such task job. This is due to the fact that some cooperative societies are mainly located in the communities or villages where inefficient as their manager who does not have the required training and experience for the job. In this process of research, it has been identified that these problem has led to premature death of some noble societies and further discouraged many people from joining the already functioning cooperative societies since they do not see cooperative as an effective business organization that can last like any other business organization. Effective management of cooperative society is not possible without adequate and up-to-date knowledge of an accounting system.

1.3     OBJECTIVES OF THE STUDY     

The general objective of this study is to examine accounting system of cooperative societies. The specific objectives are:

1.     To find out if cooperative societies in Ota LGA have a quality accounting system.

2.     To identify the challenges of cooperative societies in the keeping of accounting records in ota LGA.

3.     To know the impact of accounting system on the profitability of cooperative societies in Ota LGA.

4.     To ascertain the type of accounting system adopted by cooperative societies in Ota LGA

5.     To examine the effectiveness of accounting system on the management of cooperative societies.

1.4     RESEARCH QUESTIONS

The relevant research questions related to this study are:

1.     Do cooperative societies in Ota LGA have a quality accounting system?

2.     What are the challenges of cooperative societies in the keeping of accounting records in ota LGA?

3.     What is the impact of accounting system on the profitability of cooperative societies in Ota LGA?

4.     What is the type of accounting system adopted by cooperative societies in Ota LGA?

5.     What is the effectiveness of accounting system on the management of cooperative societies?

1.5     SIGNIFICANCE OF THE STUDY 

This study may be of enormous benefit to the cooperatives, pre and post cooperators, students, public and the government. To cooperators, the study may help them to formulate a proper and better management and accounting system that will help in the growth and development, as well as the realization of the goals and objectives of cooperative societies.

To pre member of cooperative societies, it may serve as guide in understanding the management and accounting system of cooperative societies which may serve as a guide in formulating their own accounting system when forming a new society. To post members; it helps them to see what are lacking in the accounting system and in the running of the fund of cooperative societies and the correction might be a temptation to delve back in the cooperation. To the students and public, it may serve as a source of literature to the public and also to students in accounting as well as cooperative department who may decide to research more on this topic or related issues.

To the government, the study may serve as a guide to policy making as regard to cooperative societies and also in structuring laws and rules for cooperative societies.

1.6     SCOPE OF THE STUDY

The scope of this study is restricted to the accounting system of cooperative societies in Ota LGA of Ogun State.

1.7     LIMITATION OF THE STUDY

Some of the major constraints the researchers encountered in putting up this research include lack of time, lack of willingness to give information by respondent and also limited resources

1.8     DEFINITION OF TERMS     

An accounting system : is the system used to manage the income, expenses, and other financial activities of a business.

Cooperative society: is a commercial enterprise owned and managed by and for the benefit of customers or workers

Credit union: is a non-profit-making money cooperative whose members can borrow from pooled deposits at low interest rates.