TABLE OF CONTENT
TABLE OF CONTENTS
of the Study
of the Study
of the Study
of Accounting in Business
Usefulness of Accounting Information System, In Public Corporation
Background of the Corporation
and Sampling Description
Analysis and Interpretation
5 1 Conclusion
corporation can be defined as the types of business organization that are
established by a special act (or ordinance) of the parliament. Public
corporations and business owned and financed by the federal, state and local
government, as the case may be in the public interest.
can be explained and described also as the type of business) organization
thoroughly and solidly established by act of parliament to provide public
utilities. This participation in the productive and commercial part of a
are some areas in the economy where it is felt that the free enterprises system
and private sector competition should not allowed, as they would exploit the
public such as should be run by the government in the pubic interest.
Therefore, in Nigeria, where there is a three-tier system of government; The
local government, state government and the federal government do run certain
enterprise so as to provide essential service for the people.
TYPES AND FORMATION
enterprise can be categorized into public corporations or boards or quasi
corporations are enterprises that have commercial functions, which are normally
established of the federal level by an act of parliament or decree, which
specially refers to the corporation. Each corporation, board or authority had a
particular or decree establishing it. The cat will take the objectives and of
the corporation and specify its power and how it is to be run and managed. At
the state level, public corporations are established by a state judge at the
local government level are established by social edicts.
instance, the National Insurance Corporation of Nigeria (NICON) was
established. Decree 22 of July, 1969 to ‘write all classes of insurance such as
fire, Motor accident, workmen’s compensation, marine and aviation, I did Risk…Among
ports authority (NPA) was established in 1955 to “identify and satisfy the
demand for port facilities and services at minimum cost to the nation”.
the Nigeria enterprises promotion board was established in 1972 to advance and
promote enterprise in which Nigerians are encouraged to participate fully and
play important roles”.
corporations and board the federal level includes:
federal radio corporation of Nigeria (FRCN).
Nigerian railways Corporation (NRC)
central bank of Nigeria (CBN).
National Electric Power Authority (NEPA).
Nigerian telecommunication Limited (NITEL)
Nigerian national Petroleum Corporation. (NNPC)
Nigeria coal Corporation (NCC)
Nigeria cost corporation (NCC).
may be made of the universities, Polytechnics, College of Education and the research
institute which is public sector educational enterprise established by relevant
federal acts, decree or state laws is the case be.
corporations are to be independent of the central government as possible. Thus,
they are by Boards or councils each of which has the board of Directors of A
Company. Each corporation also have general Manager or similarly placed officer
who is the chief executive reporting to the board a council
THE FEATURE OF PUBLIC CORPORATION
the main features of the public corporations that a manager is put in as supervisor
in the running of the business. The board of Directors in responsible to the
minister of the government and the parliament. This is one reason why the
public corporation type of business is described as being controlled by the
special feature of the public corporation type of business to that it is sot-up
and are financed, by the government initially. Only some have issued stock to
the public to obtain large capital and long-term capital. This means that the corporation
has on shareholders except in some cases.
other feature in that public corporation is not aimed at malign profit. This
does not mean that they do not aim at making profit. The government can
supplement the public corporation with government grants. If the earning of the
business fall. The government can do this by taxing the citizens in order to
meet its expenses.
public corporation does not share or distribute profit but they have and meet
or pay interest on state issue to the previous owners of the business on their
feaster of the problem corporation in that it deals with those economic activities
that the community may be benefit from but which offer. The businessman may was
the fact that such a commodity or service is renewed essential to exploit the
consumer. An example of such is electricity.
of then commodities supplied and feature of the public corporation. An example
is the service of the Nigerian Railways Corporation (NRC) whose services are
available only to the area that are covered by real, The electricity
corporation of Nigeria can only supply areas where their electric cable and
monopolies are also brought by the business of the public corporation this
important feature means that is difficult for other business to compete with
the corporation. An example of this that no other form of business may or will
install in electric power station in a dies where the Electricity Power
Authority of Nigeria has setup it stations. In fact, paramagnet will not
approve the move.
characteristic of public is discriminating services rendered or goods supplied.
For example the NEPA can charge less on the supplied to factors or industries
than on power supplied to private domestic consumers. This possible because their
services generated cannot be transferred from one customer to another.
main feature of the public corporation is that it always operates below full
capacity. This is so because the establishment needs large fixed capital.
Therefore, the existing demand of the public as a whole to be able to meet any
future increases in demand.
SOURCES OF CAPITAL
corporation are normally set up by the government and financed wholly by it.
Thereafter, they are expected to generate fund through their services to the
public to be paid to government account. The major aim of establishing them is
not to make profit although, the ones that have purely commercial functions are
required nowadays to generate enough fund to cover then services and make
profit for the government. The three sources of capital that can be identified in
the financing ct the public corporation are government financial grants, bank
loans and internally generated revenue.
1. Government Financial Grants: The
government makes budgetary provision for the government department and
financial grants to the statutory corporation which rendered social service and
is prevented from charging the full price for their services. Subsidies became
imperative to make up the deficit in internally generated revenue.
2. Loan From Banks: Public corporation
through their boards and councils are empowered to negotiate and dices loans
from the local hank to execute certain project.
3. Internally Generated Revenue: Statutory
corporation, boards and authorities utilize their internally generated revenues
to finance part of the operations.
REASONS FOR THE ESTABLISHMENT OF PUBLIC
Essential Services: The establishments provide services
which are vital to the citizen end which should to provide without the motive
of profit for the overall god of the masses.
Avoidances Waste And Public Publication: it should be more economical to run
water and to run water and electricity undertaking as states monopolies because
laying water pipes ands power lines across the roads and in people’s houses
would be wasteful. Such activities would also give rise to public relationship
problems, which are more easily solved by the government botches than by
Capital Requirement: The local needed to establish most of
the public utilities are so large that it cannot be afforded by private
Good Infrastructural Base: A good network of roads and railways,
powers, communications etc. will lay a solid foundation for paid economic
development land progress of the country. They are strategies to the government
and the people. Therefore, only the government can run them in the public
Even Development: The policy of most government is
encourage even development and bring about equitable distribution of the
country wealth, To achieve these objectives the key industries and
organizations should be in the ranks of the government.
Social Cost: The social cost of some undertaking
make the government the most suitable candidate to establish and run them. For
instance, to lay a rail or pipelines across towns, cities and village would
result in the destruction of cash crops and dispossession of the citizens’
land; the establishments of a claim wouki involve the destruction of cash crops
and displacement of villages. Under these circumstances, the governments in the
only organization that can carry out the undertaking because of the coercive
power, which it possess.
CONTROLS AND MANAGEMENT
of statutory (public) corporation are checked by the following measures adopted
by government policy.
government departments are responsible to the government through the appropriate
minister of commissioner.
government is to appoint member of their various boards and councils. The
boards and councils run the corporation according to their government policy.
influence plays some parts too. The public maintains an eye on the activities
of the public utilities and usually ready to voice their opinion and dissent
through the press anytime something goes wrong.
PROBLEMS FACED BY PUBLIC CORPORATION
Poor Condition of Service for Staff: It is often that the unified grading
system makes it difficult for the public corporation and companies to attract
staff with exceptional quantity.
Poor Management: Many board and council member see
their appointments as opportunities to take a slice of the public take. It is
often alleged that many board member spend all their time pursuing contracts
and arranging for distributorship.
General Laxity on the Party of Staff: In the private sector, staff work
hard because they know that if the company fails to breakeven, it sold probably
liquidate and they would lose their job, the situation does not occur in the
public service where customers who have come to buy goods or services might be
turned away or asked to “come tomorrow”. Because the staff concerned might be busy
doing other work.
Bad Economic Condition: The worldwide economic recession and
the consequently poor condition of the Nigerian economy also affect the public
corporation to the same extent.
Exclusive Centralization: The lack of decentralization of
public utilities like PHCN makes their management weak and decision making
Frequent Change Of Board Members: The frequency with which the boards
and councils are reconstituted tends to defeat the purpose for which they aft
STATEMENT OF PROBLEM
statement of this study in the use of accounting information in public
corporation, NNPC as a case study considering the behavior relationship the
uses of accounting information in public corporation.
THE PURPOSE OF THE STUDY
of the study were to examine how useful accounting information is in public
1.3 SIGNIFICANT OF THE STUDY
study is deducted; the result could help the management and board of directors
to show its stewardship and Accountability in the operational activities of
trying to obtain information from correspondents, certain drawbacks were
encountered which under data collection. The reluctance of some of key officer
to release records which are labeled as “sensitive” and “confidential” posed a
limitation to the scope of study. The fact that there is a limit within which
to submit this work was a limitation in itself.
As a private
student, my financial resources are limited and this also acted constraint
1.5 DEFINITION OF TERM
Budget: According to the terminology of the
institution of cost and management accountability, budgeting is a plan,
quantified in monetary terms, prepared and proved prior to defined period of
time, usually showing planed income to be generated and/or to be employed to
attain a given objectives.
the establishment of budgets relating to responsibilities of executive to the
requirement of a policy end the continue compassion of actual with budgeted
result either to cure by individual action, the objectives of the policy or to
provide a basis for it revision
OF BUDGETARY CONTROL
objectives of budgetary control are to:
the ideas of all levels of management during budgetary preparation.
management when action is needed to remedy a situation.
and control income and expenditure.