THE ROLE OF FINANCIAL ACCOUNTABILITY IN THE SECTOR ( A CASE STUDY OF EMENITE ENUGU).

ABSTRACT

Accountability is the sole of any business entity.  The main aim of any business is profit maximization.  This can be achieved if the financial mismanagement is properly examined

Emenite limited Enugu is a company, which concentrates much on the manufacturing and distribution of ceiling boards, corrugated roofing sheets, roofing tiles, flower pots and pressure pipes.

In view of different scholars has been established by the researcher, the role of financial management is very important.  In every organization especially the private ones, since the efficient management will lead to the attainment of organizational objectives.

A general background of the topic and the background of the company will be discussed also the statement of problem, objectives of the study, formulation of hypothesis, significance and definition of terms.

The related text as regard financial accountability will be reviewed, this will discuss the notion of financial accountability, the network of internal control system, internal checks and auditing practices responsibility sharing as a control ins the private sector of Nigeria economy, accountability and general economic growth and enhancing financial accountability by human resources.

CHAPTER ONE

INTRODUCITON

Accountability as seen by Iwumunne (1982:56) is the goal of any business entity.  A mismanaged form is a failure.  The main aim of business is profit maximization.

This cannot be achieved if financial mismanagement is enthroned  in any form . in any business setting, the priority of management is to enable the firm to continue to finance its undertaking.  This cannot be achieved without due regard to prudent financial administration

According to Muola Otanka (1975) the spirit of continuity of a business is the careful administration that will administer the financial undertakings.  Really, the issue of financial impropriety has made many business collapsed. There are many ways to check the menace in both public and private life.  Any method used is subsumed in effective control system which primarily cues form internal control.

According to Jonah Jenny (198212) internal control can be perceived in the following ways:

-Good record keeping of all transaction in the shop and factory

-Shop and factory

-Good stock control system

-Well-coordinated channel of raw material procurement

-Articulate handling of organizational behaviour seen kin the enterprise

-Effective trade union administration

-Efficient redundary control

-Good personal administration

-Avoidance of waste

-Good structural organization

-Acceptable party with government policies

-control of acquisitions

-Good pension scheme

There, he said are not exhaustive. It is when management recognizes the necessity of effective internal control system management of material and resources is very much possible.  Quoting the issue of bank distress.

Akinloye Oyibanyi (1999:86) observed that may factors contributed to the reason why banks failed. Right loan administration to project supervision, there was no commitment to the whole affair everybody administration has loan process.  The banks collapsed due to lack of financial prudence, which is a clear cut example of management in capacitating

To have effective control of material men and machine management need grassroots control affected through monitoring of pay financials disbursement.  The issue at stake is that good internal control is a necessary condition for efficiency of any organizations.

To state it differently, any organization that opts for a continued business entity must be prepared to timely check the personnel, procure the fight type of personnel, train them on the technical aspect of the work and teach equity and justice in finance appropriation

The financial manager must be a model of sound background of prudent handling of money.  That bank failed means that management failed.  In the small-scale business, there is the tendency to effectively manager the resources well.  This is due to the man-to-man approach of the management

The system of internal control is comparatively higher than that of public sector.  It is in this note that management of small-scale enterprises is mostly looked upon as very efficient in financial management

This is not to say that they are not without any blame. Infact, they do not reap internal economic of scale at least in the developing world due to their largess.  But in the areas of prudent handling of finance, they out weight the public sector.  This could be due to the own-personal nature of the business. The prevailing economic crunch in the country is also attributed to the lack of effective internal control system. Being that the head of any development nation is in the business of the private sector, the way internal control is handled that area is suggestive of the level of development revealing.

Besides, the competitive nature of industry require good internal control system.  Issues that are central to the effective internal control system include: organization, authorization and approval, physical control, personal capabilities, arithmetic and accounting managerial control and supervision.

According to Wabare (1998) the central idea of auditing and investigation is to prevent Wastes in financial appropriation, which is the bedrock of effective internal control system anywhere. He observed that no meaningful internal control existed outside the principle and ethics of auditing in all its four cardinal principles advisory, implementation reporting and routine testing auditing tries to foster the spirit of corporation and control resources. This helps to keep the business on.

BACKGROUND OF THE STUDY

The subject of financials accountability has en a controversial issue even month the early philosophers. Plato condemned usury (i.e. the use of money in trade) according to him for the attendant “social its unethical reason (1)

The debate has continued in the contemporary business world, albeit, in different magnitude and directions.  In addition to the above, the peinlia nature of the Nigeria economy has made any topic in accountability, financial or otherwise, worth discussing.  Nigeria has had her fair share of financial improperly both in the public and private sectors.  T his not quite unconnected with her political set up. The history of the evaluation of her financial institutions and level of the country” development.

The research has therefore been reduced to the firm (micro) level and emenite limited Enugu has been carefully selected to be used in drawing a line of parallel between the level of accounting in the public and private sectors

Control is an adjunct of accountability. The extent of financial accountability therefore should be reflected to the extent of the working control mechanisms with the particular organization.

The fact both public and private sectors make use of control measures indisputable.  The  extent to which they employ this and how it has improved their finances is called to question. The effective means, by which they empty internal control to safe guard assets collect debt or pay creditors etc.  is the issue at stake.

Its should be stated abinition that the internal control under discussion here is not the myopic type, which advocates only the prevention of fraud and embezzlement of, control over all organizations activities.

In the words of a management expert internal control companies the plan of organization all co-ordinate method and measures adopted within a business to safeguard it assets, check accuracy and reliability of its accounting data, promote operational efficiency and encourage adherence to prescribe managerial policies: (2)

Put differently, the general conception of internal control have is that it should be effective enough to cause probity in all the organization activities with a resultant disciplined financial atmosphere in the organization. This is the manner of internal control which will be emphasized throughout paper.