EVALUATING LOCAL GOVERNMENT CODE OF ACCOUNTING PRACTICES AND FINANCIAL REPORTING (A CASE STUDY OF OHAUKWU LOCAL GOVERNMENT AREA, EBONYI STATE)

ATTENTION:

BEFORE YOU READ THE ABSTRACT OR CHAPTER ONE OF THE PROJECT TOPIC BELOW, PLEASE READ THE INFORMATION BELOW.THANK YOU!

INFORMATION:

YOU CAN GET THE COMPLETE PROJECT OF THE TOPIC BELOW. THE FULL PROJECT COSTS N5,000 ONLY. THE FULL INFORMATION ON HOW TO PAY AND GET THE COMPLETE PROJECT IS AT THE BOTTOM OF THIS PAGE. OR YOU CAN CALL: 08068231953, 08168759420

WHATSAPP US ON 08137701720

EVALUATING LOCAL GOVERNMENT CODE OF ACCOUNTING PRACTICES AND FINANCIAL REPORTING (A CASE STUDY OF OHAUKWU LOCAL GOVERNMENT AREA, EBONYI STATE)

CHAPTER ONE

INTRODUCTION

BACKGROUND OF THE STUDY

Financial reporting as an element of financial accountability is very significant in ensuring proper use of public finances for providing social services. Faridi and Nazar (2013) point out that the need for strong management of public resources at local government has been accelerated by the fiscal decentralization which grants fiscal autonomy in both revenues and expenditure responsibilities. The nature of operations in local governments attracts strong mechanism of financial accountability and one of the key elements of financial accountability is financial reporting. Also, Setiyawati (2013) argues that one of the main roles of internal control is to ensure reliability of local government accounting and financial information which leads to quality of financial reporting. The government of any nation is saddled with the responsibility of ensuring that its citizens get the best of social and developmental facilities available. They are responsible for setting macroeconomic policy; seek to promote equity by aiding the poor and the disadvantaged. According Shamsuddin et.al (2012), Local government administration in Nigeria has been inexistence since 1972 but its inefficiency and ineffectiveness in addressing the primary needs and wants of the people at the grass root has made this third tier of government irrelevant in its administration to the people. Reasons for this evolving problem include issues around accountability, value for money, transparency, indiscipline and financial challenges. In response to solving this prevalent problem many countries, both developing and developed, have adopted various accounting reforms or practices since the genesis of neo-liberal agenda discourses (Boex et .al, 2011; Pollitt and Bouckaert, 2011; Lapsley and Mussari, 2008; Bogt, 2008. These budget reforms are usually responses to internal and external pressures to ensure efficient and effective allocation of scarce resources and to foster “good governance” through democratic participation in decision-making, budget transparency and accountability (the Danida, 2009; the World Bank, 2011, 2006; Economic Commission for Africa, 2009, 2010; Lapsley and Mussari, 2008, Alnesafi et. al,2015). In developing countries, external pressures have been the major driving force for accounting reforms and this is as a result the level of dependence of these countries to supranational aid or financial support from institutions, such as IMF, the World Bank, and others.

Hopper, 2009). Another very key factor that as influenced accounting reforms is the practice of the private sector in the form of the New Public Management (NPM) reforms and its relationship with organisational operations (Hood, 1991, 1995) which generally modernized the Local Government councils by adopting practices such as benchmarking, balanced score cards, and competitive tendering (Ball, Bowerman, and Hawksworth, 2011; Bowerman, Ball, and Francis, 2010; Bowerman, Francis, Ball, & Fry, 2014). . New Public Management (NPM), which derived it basis in management theory and new institutional economics, has been a global movement in many countries since the 2015s (Hood, 1991; Humphrey et al., 1993; and OECD, 1995). Its belief is that private sector management and commercial business practices are superior to public management and practices. Although many variations exist, the common set of reform prescriptions is characterized by a greater focus on results, devolution of authority, strengthened accountability and control, client or customer orientation, and introduction of market elements (Hood, 1995a; and Cheung, 1997, as cited in Yamamoto,1999). Accounting plays a central role in NPM; indeed, Power and Laughlin (1992) describe the change in modes of public management as a shift towards accountability. The change from cash based accounting or budgetary accounting to accrual accounting is part of a broader public sector reform process in the Anglo-Saxon democracies (Robinson, 1998). A notable example is the New Zealand government which has prepared its annual report on a full accrual basis since 1992 (Pallot, 1994). The aims of the introduction of accrual accounting are to facilitate more transparency in agency performance and to improve efficiency and effectiveness. It is argued that a full accrual accounting system is able to provide more information in terms of quantity and quality. Accountability in the financial management of any local government must be held in high esteem if the local government is expected to develop. This role is nonetheless, generally seen as the sole responsibility of the local government core staff but the government made of government representatives on the management of the public financial resources. Therefore this study seeks to examine the accounting practices and financial reporting of Local governments’ councils in Nigeria evaluating the problems existing in the system and how various reforms have aided the provision of a lasting solution to the poverty and hardship experienced at the local level by citizens.

STATEMENT OF PROBLEM

This study entitled appraisal of the accounting practices and financial reporting of local government attempt to determine the problem involved in establishing and applying standard accounting system in local government with practical reference to Ohaukwu local government area of Ebonyi state, Nigeria some of the problem facing the local government are; that the accounting system installed in the local government is not fully effectively operated. Also, the accounting system of the local government is inadequate in design. As a result of these, the financial statement as prepared by the local government does not reflect or show its true financial positions. The entire instruments of control in the local government seem to have collapsed. Consequently, there are increases in the mismanagement, scandalous embezzlement, extravagance, wastage, misappropriation of bills, contract abandonment, over prizing of goods/service, salaries padding, capital flights and all other sorts of corruption in Local governments in Nigeria. Thus the objective of the local government auditing seems to have been defeated owing to the widespread accusation by the public to the fact that auditors merely express true and fair view without attempting to conform to professional standards, legal requirement and other regulatory framework. Therefore, this study broadly aims to ascertain the effect of accounting practices and financial reporting on public accountability in Ohaukwu Local government of Ebonyi State.

1.3. AIMS AND OBJECTIVES OF THE STUDY

The major aim of the study is to evaluate Local government code of accounting practices and financial reporting. Other specific objectives are as follows;

To examine the nature of accounting practices and financial reporting used in Local governments in Nigeria.

To examine the extent to which local government councils have been able to keep proper accounting statements.

To examine the problems inherent in accounting practices of local government.

To examine the effect of local government code of accounting practices and financial reporting on local government performance.

To examine how actual undertaking of accounting practices differ among the Local government.

To examine the relationship between local government code of accounting practices and financial reporting in Nigeria.

To suggest how Local government finance can be properly managed in the benefit of the people in particular and society in general.

1.4. RESEARCH QUESTIONS

How is the nature of accounting practices and financial reporting used in Local governments in Nigeria?

What is the extent of the local government councils being able to keep proper accounting statements?

What are the problems inherent in accounting practices of local government?

What are the effects of local government code of accounting practices and financial reporting on local government performance?

What makes actual undertaking of accounting practices differ among the Local governments in Nigeria?

What is the relationship between local government code of accounting practices and financial reporting in Nigeria?

What are the suggested ways on how Local government finance can be properly managed in the benefit of the people in particular and society in general?

1.5. RESEARCH HYPOTHESIS

H0: Effective accounting practices and financial reporting does not influence local government performance.

H1: Effective accounting practices and financial reporting significantly influence local government performance.

1.6. SIGNIFICANCE OF THE STUDY

This study is largely significant because it sought to find empirical answers to questions on the Local government code of accounting practices and financial reporting in Nigeria. The research paper will be of interest and useful to the general public’s the government as well as the governed and also to future researchers in taking a stand on what is prevalent in the country. This research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied will go to an extent to provide new explanation to the topic.

1.7. SCOPE OF THE STUDY

The study is restricted to Local government code of accounting practices and financial reporting: case study of Ohaukwu L.G.A, Ebonyi state.

1.8 LIMITATION OF STUDY

Financial constraint– Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

Time constraint– The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

1.8 DEFINITION OF TERMS

Local Government: Is a form of public administration which, in a majority of contexts, exists as the lowest tier of administration within a given state. Local governments generally act within powers delegated to them by legislation or directives of the higher level of government.

Accounting: Accounting is defined by Douglas (1976) as “a discipline concerned with the recording, analysis, and forecasting of income and wealth of business and other entities.

Accrual Basis Accounting: This is a method of accounting whereby revenues and revenues and expenses are identified with specific periods of time, such as a month or year and are recorded as incurred, along with acquired assets without regard to the date of receipt or payment of cash.

Capital Expenditure: All expenditures incurred on the construction or extension of projects in acquisition of lands and buildings and on the purchase of plant or equipment (but exclusively the cost of repairs and maintenance).

HOW TO RECEIVE PROJECT MATERIAL(S)

After paying the appropriate amount (#5,000) into our bank Account below, send the following information to

08068231953 or 08168759420

(1) Your project topics

(2) Email Address

(3) Payment Name

(4) Teller Number

We will send your material(s) after we receive bank alert

BANK ACCOUNTS

Account Name: AMUTAH DANIEL CHUKWUDI

Account Number: 0046579864

Bank: GTBank.