Enhancing Financial Accountability In The Private Sector

The broad objective of this study is focused on enhancing financial accountability in private sector using 7up Bottling company as case study. Survey research design was adopted for the study and with the aid of convenient sampling method, the researcher selected Eighty (80) participant who are Management and Staff in 7up Bottling Company in Aba as the respondent of the study. Well structured questionnaire was issued to the 80 respondent of which total of 77 responses were retrieved and validated for the study. Data was analyzed in frequencies and tables using simple percentage, mean and standard deviation. Findings from the study revealed that there is adequate division or segregation of duties of various level of management in the organization in 7up Bottling Company. The study revealed that there step taken when inefficiency is detected in the internal control system. More so that in 7up bottling company there is a system of adequate authorization and recording to provide reasonable accounting control over assets liabilities, revenue and expenses in private organization. However that more can be done to enhance financial accountability such steps includes: Reduce tolerance of corruption through big data and analytics, Ensure accrual accounting is central to the whole PFM system to provide an accurate financial picture. The study therefore recommends that Private organizations should maintain and leverage the positive impact of the control environment and control activities to boost their operating performance. Moreso, private organizations should commit more to integrity, ethical value, competence, accountability, as well as the development of preventive and detective control activities through the engagement of technology, and standardization of policies and procedures for transaction approval, verification and reconciliation which would have a significant effect on their business performance.

Introduction

1.1 Background of Study

The subject, financial accountability is vital to any organization, be it profit oriented or non profit oriented. Lack of financial accountability result to embezzlement, fraud and misplacement of funds. The regular nature of the Nigeria economy has made any topic in accountability, financial or other wise, worth discussing. Nigeria has had her fair share of financial impropriety both in the public and private sectors, this is not unconnected with her political set up, the history of the evolution of her financial institution and of course the level of the country development. Its due to the problem mentioned above which is associated with lack of financial accountability in any organization that has motivated the researcher to choose the topic enhancing financial accountability in the private sector of Nigeria economy through a system of control. Internal control system comprises the plan of organization and all co ordinate method and measure adopted with in business to safeguard its asset, check accuracy and reliability of its accounting data, promotes operational efficiency and enlarge adherence to prescribed managerial policies.

The research will focus on finding if the reference company has installed this control system and if so, how effective it is as to enhance early detection of mistake deliberate misappropriation and detection of severally check collusion, fraud or embezzlement of funds through proper authorization, reliability of financial record, safeguarding of assets and hence, maintenance of financial accountability. However, the ability of any business organization to enhance its financial accountability depends mostly on the type and effectiveness of its internal control system should be designed in such a way that it is effective as to benefit primarily the organization.

1.2 Statement of Problem

Every policy formulated in boardrooms would have been a success if any were being carried out there too. But adherence to planned policies by employee is the problem of many a management companies. Management is the act of getting things done through other. The owners of every lousiness expect a reasonable return on their investment, irrespective of who executes the policies the problem of policy execution is further compound by the evolution of larger organization personal supervision of employee by individual manager seems an attempted at impossibility with larger span of control.

Therefore, the need for an internal control system is such an indispensable tool in the hands of management if it wishes to obtain adequate and useful information, protect company asset and control successive operation which land to accountability but despite the established necessity for installing and internal control system, if has been discovered that most business do not maintain any internal control system because they assume that it is expensive to operate many managers do not see the need for installing an internal control system to prevent big losses at every little additional cost. That many control procedure whose effectiveness depend on segregation of duties are being circumvented by the collusion of the employee is yet another problem. The degree of compliance with the control procedure are often left to deteriorate due to negligence of duty carelessness, mistake and even personal factors.

These factors are problem to the firms and eventually undermine the effectiveness and efficiency of internal control system if not taken care of. These problem question abound: How adequately are subordinate adhering to the internal control measure, What measure should management adopt to test observance of internal control procedure? Should the internal auditing be an adequate means of checking circumvention of internal control measure? Should management rely on internal auditing to appraise the efficiency and adherence to internal control? Should the effective of internal control be relied on for adequate financial accountability? These question prompt the need for a research study of the kind embarked upon here, and they are further addressed in subservient chapters of the project which is focused on enhancing financial accountability in private sector using 7up bottling company as case study.

1.3 Objective of the Study

The broad objective of this study is focused on enhancing financial accountability in private sector. Specifically the study seeks:

To ascertain whether there is adequate division or segregation of duties of various level of management in the organization.

To ascertain if there are step taken when inefficiency is detected in the internal control system.

To know whether there is a system of adequate authorization and recording to provide reasonable accounting control over assets liabilities, revenue and expenses in private organization

To determine if financial accountability has an effect on the performance of private organization

1.4 Research Question

Is there adequate division or segregation of duties of various level of management in the organization?

Are there step taken when inefficiency is detected in the internal control system?

Is there any system of adequate authorization and recording which provide reasonable accounting and internal control?

What are the ways through which financial accountability can be enhanced in organizations?

1.5 Significance of Study

Many establishment loose fabulous amount due to fraudulent acts of some of their employee these have led to the folding up of some private and public enterprises. To save this ugly situation investigation and correction are to be made as regards those things that cause ineffective internal control is lack of accountability increased losses and eventually reduction in the firms level of profitability. It is believed by the researcher that effective internal control system will enhance financial accountability. Moreover, companies with affective internal control system will benefit from it as that will make for financial accountability. Effective internal control system most often is believe to enable the companies with it, to achieve their objective and it will be for the overall good of any company. Empirically, the study will contribute to the general body of knowledge and serve as a reference material to both scholars and student who wishes to conduct further studies in related field.

1.5 Scope and Limitation of the Study

A research into the internal control system of any organization is a research into its efficiency, profitability apparatus, viability prospect and of course accountability of the entire organization. It is the purpose of this study therefore to have a close look at the sort of internal existing in 7up bottling company, Aba if there is any, then to know how effective this has assisted in attaining financial accountability.

1.7 Limitation of the Study

Like in every human endeavour, the researchers encountered slight constraints while carrying out the study. The significant constraint was the scanty literature on the subject owing to the nature of the discourse thus the researcher incurred more financial expenses and much time was required in sourcing for the relevant materials, literature, or information and in the process of data collection, which is why the researcher resorted to a limited choice of sample size. Additionally, the researcher will simultaneously engage in this study with other academic work. More so, the choice of the sample size was limited as few respondent were selected to answer the research instrument hence cannot be generalize to other corporate organizations. However, despite the constraint encountered during the research, all factors were downplayed in other to give the best and make the research successful.

Summary, Conclusion and Recommendation

5.1 Summary

The broad objective of this study is focused on enhancing financial accountability in private sector using 7up Bottling company as case study. The study ascertained whether there is adequate division or segregation of duties of various level of management in the organization. It ascertained if there are step taken when inefficiency is detected in the internal control system. It determined whether there is a system of adequate authorization and recording to provide reasonable accounting control over assets liabilities, revenue and expenses in private organization. it determine if financial accountability has an effect on the performance of private organization.

Survey research design was adopted for the study and with the aid of convenient sampling method, the researcher selected Eighty (80) participant who are Management and Staff in 7up Bottling Company in Aba as the respondent of the study. Well structured questionnaire was issued to the 80 respondent of which total of 77 responses were retrieved and validated for the study. Data was analyzed in frequencies and tables using simple percentage, mean and standard deviation.

5.2 Conclusion

Financial accountability entails the recording, communicating, summarizing, analyzing and interpreting financial statement in aggregate and in details. Thus it is expected that private organization consider this aspect as crucial to ensure adequate internal control. The internal control system is central in the discourse of operational performance of any organization because it encompasses all efforts put in place by management to ensure efficiency, effectiveness, compliance and reliability of business transaction and communication.

Findings from the study revealed that there is adequate division or segregation of duties of various level of management in the organization in 7up Bottling Company. The study revealed that there step taken when inefficiency is detected in the internal control system. More so that in 7up bottling company there is a system of adequate authorization and recording to provide reasonable accounting control over assets liabilities, revenue and expenses in private organization. However that more can be done to enhance financial accountability such steps includes: Reduce tolerance of corruption through big data and analytics, Ensure accrual accounting is central to the whole PFM system to provide an accurate financial picture. Company can apply a whole systems approach to improve scrutiny and ensure Properly plan for reform.

5.3 Recommendation

From the findings of the study, the following recommendation s are made:

Management of private organizations should always practice proper recording of transactions and each and every other transaction should always be recorded and kept for references.

Management should improve on some internal control systems such as documentation of transactions that can best suit the organization"s operations.

Approval of transactions should always be done every time the transaction is carried out by reasonable personnel and maintain regular internal audits of their accounts systems.

Segregation of cash duties should always be done so that no one carries out a transaction right from the recording to the balancing of a transaction.

There should always be strong tools in authorization of responsible personnel to access the organization"s assets.

Generally internal control systems put in place should be strengthened to yield profits to the organization hence the performance.

Private organizations should pay attention to human resource management practices. In clear terms, SMEs should commit more to integrity, ethical value, competence, accountability, as well as development of preventive and detective control activities through the engagement of technology, and standardization of policies and procedures for transaction approval, verification and reconciliation.

Finally, issues surrounding risk assessment, information and communication as well as monitoring activities should be addressed systematically based on the reality of the operational structure of each enterprise, so as not to undermine the role of the internal control system with a lopsided approach to risk assessment, information and communication and even monitoring activities

• Enhancing Public Confidence In Financial Reporting, The Role Of Corporate Governance
• Evaluation Of The Strategies For Enhancing Financial Accountability In The Local Government System
• Accounting Information System As A Means Of Enhancing Financial Management Of Transport Company
• Strategies For Enhancing Financial Accountability In The Local Government System
• Enhancing Public Confidence In Audit Report Of Financial Institutions

• Accounting Project Topics and Materials