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Management Of Public Funds In Industries

(A Case Study Of Life Breweries Limited Aba)

5 Chapters
|
127 Pages
|
14,269 Words

The management of public funds in industries necessitates a delicate balance between ensuring efficient allocation for societal benefit while safeguarding against misuse or misappropriation. Transparent budgeting, stringent oversight, and accountability mechanisms are fundamental to uphold public trust and maximize the impact of investments. Effective governance frameworks, including robust auditing processes and regulatory compliance, are essential to mitigate risks and maintain fiscal responsibility. Additionally, fostering a culture of integrity and ethical conduct among stakeholders, coupled with comprehensive reporting mechanisms, strengthens the accountability of public funds management in industries, fostering sustainable development and equitable growth.

ABSTRACT

For some time now, many developing third world countries especially Nigeria has been suffering a wide variety of problems raging from economic political, social, cultural, religious and a host of other problem to mention but a few. Nigerian government in attempt to solve these problems, have been investing some of the public at her disposal in industries to enhance quick economic growth of the country.
As a result of the current economic recession, many industries have liquidated and gone out of production while some others are yet making it. This research is aimed at finding out the problem of these industries that have survived and the steps being taken by the public fund manager to remain in the market.
Life Breweries Ltd. Onitsha viz-a-viz other industries in the public sector was discovered to be having problems like other of finance, raw material, spare parts, foreign exchange and also mismanagement of available funds by the financial managers of the company have been taking lots of steps to see to their existence in the productive sector applying their financial management skills effectively and efficiently.

TABLE OF CONTENT

TITLE PAGE
APPROVAL PAGE
DEDICATION
ACKNOWLEDGEMENT
ABSTRACT

CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
1.2 STATEMENTS OF THE PROBLEM
1.3 OBJECTIVES OF THE STUDY
1.4 SIGNIFICANCE OF THE STUDY
1.5 HYPOTHESIS
1.6 SCOPE AND LIMITATION OF THE STUDY

CHAPTER TWO
2.1 REVIEW OF THE NIGERIAN ECONOMY
1982 – 1989
2.2 INDUSTRIALIZATION IN NIGERIA
2.3 LIFE INDUSTRY, A BIG BOOST TO
NIGERIAN’S ECONOMIC RECOVERY
2.4 FINANCIAL MANAGERS IN THE
MANAGEMENT OF PUBLIC FUNDS
2.5 INDUSTRIAL SOLVENCY IN A
DEVASTATED ECONOMY

CHAPTER THREE
1.1 RESEARCH DESIGN AND METHODOLOGY
1.2 SOURCES OF DATA
1.3 SAMPLE USED
1.4 METHOD OF INVESTIGATION
1.5 METHOD OF ANALYSIS

CHAPTER FOUR
4.1 DATA PRESENTATION AND ANALYSIS
AND INTERPRETATION
4.2 TEST OF HYPOTHESIS
4.3 SURVIVAL STRATEGIES OF NIGERIAN

CHAPTER FIVE
5.1 SUMMARY OF FINDINGS
5.2 RECOMMENDATIONS
5.3 CONCLUSION

CHAPTER ONE

INTRODUCTION
1.1 BACKGROUND OF THE STUDY
In the past financial management was concerned with the raising of funds whenever the need arises and much attention was not paid to the uses of the funds so raised. But in recent times there had been a change.
The emphasis shifted from financing to the managerial financial problem from only raising of funds to efficient and effective use of funds.
As a result of this widening in scope of financial managers and others entrusted with the management have equally increased. It is no longer the issue of providing funds but it’s provision in good time for the right length of time and it’s correct use or application.
In light of this, it is necessary to investigate how these financial mangers are achieving this having known that public funds are often times misconceived by some people as no body. Funds and as a result should not be cared for.
The researchers choice of the industry for this study is mainly because of this believe that life bear posses the major feature, of any typical industry financed with the public funds in Nigeria.
These features include the acquisition of funds from investors over time it’s investment, the expectation of returns by the firms on investment over time and the periodical distribution of these return to the investors (share holders) in the form of dividend. In view of these special feature, the researcher believes that it is a good representation of the public establishment in Nigeria and as such suits the purpose of this study. A case study of Nigeria Life Breweries Aba, Abia State will therefore provide a birds eye views of the industries financial by the public fund in the country Nigeria.

1.2 STATEMENTS OF THE PROBLEM
In the light of the current economic problems of Nigeria. Visa-viz. the devastated economy, the financial mangers especially those concerned with the management of public funds invested in industries are faced with a lot of problems. The issue of raising adequate funds as well as the application of the funds so raised is no longer an easy one. These problems ranges from lack of spare parts, high cost of foreign exchange of which result in high cost of production unpredictable and inconsistent Federal Government Policies (Monetary and Fiscal) Campaign for backward integration etc.
All these had been more prominent since the introduction of SAP.
The above problem had made it possible for these financial mangers to make effective use of such tools as financial ratios in analyzing and for casting/budgeting accurately mean while, the managers are expected to see that the companies remain production and hence make profit for the fund owners to achieve these, the companies especially the Life Breweries Industries are now faced with a high rate of competition.

1.3 OBJECTIVES OF THE STUDY
In view of the background and statement of problem already discussed this work aims at achieving the following objective.
1. To identify the problem and the causes of the already identified problems of funds managers in those industries that have survived there recession in Nigeria.
2. To evaluate the role being played by the management of (Life Breweries Industry) public funds in the light of the current economic problem of the country.
3. To examine and make recommendation on what other possible measures that could be adopted in order to curb these problem or improve on the current state of affairs.

1.4 SIGNIFICANCE OF THE STUDY
The past and present government of this country Nigeria, have been trying in their own various ways to see to the improvement of the economy and the development of these nation but not much significant efforts have been made towards the effective management of the limited resources available to the nation especially in the area of the public sector and hence public funds.

1.5 HYPOTHESIS
For the purpose of this research, the research made the following assumption.
1. the life breweries is being affected by the present economic situation
2. the fund managers of life breweries are not exercising, prudency in their work
3. The life breweries is a boost to Nigeria economy policy.

1.6 SCOPE AND LIMITATION OF THE STUDY
This study covers the management of public funds that are invested in Nigerian industries.
Considering the wide nature of the topic the target population the seriousness of the problem and the tight-time budget available to the researcher it would have been too cumber some to carry the research further than the area chosen. The researcher then limited the study to industry. Nigeria limited bearing in mind that it could serve as a representation of the industries that are financed by the public funds.
There has equally been a serious campaign by the government on the backward integration of the industry.
This study will be of immense importance to our Nigerian leaders (the policy makers) in realizing that prudent financial management of public funds especially those invested in industries is one of the most important ways by which the economy could be revamped.
The study is also intended for financial of all levels and is hoped that it will contribute to their skills and knowledge.
It is addressed to administrators decision makers and other non financial readers in the hope that they will appreciate the damage done by poor financial management and therefore help to improve on the situation.
This research work will also help the policy makers (monetary and fiscal) to have an idea of the advise effect of some policies especially the flexibility of these policies.
Finally, this research work will serve as an addition tot he existing literatures in the areas of financial management of funds and it will be of help to future researcher in the field.

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Management Of Public Funds In Industries:

Managing public funds in industries is a critical responsibility, whether in the public sector or in industries with significant government involvement. The key principles and best practices for managing public funds in industries include:

  1. Transparency and Accountability:
    • Maintain transparency in financial transactions and reporting.
    • Ensure accountability by clearly defining roles and responsibilities for fund management.
  2. Budgeting and Planning:
    • Develop comprehensive budgets that outline income and expenditure projections.
    • Align budgets with organizational goals and priorities.
  3. Financial Control and Oversight:
    • Implement strong financial controls to prevent fraud and mismanagement.
    • Conduct regular audits and financial reviews to ensure compliance.
  4. Compliance with Regulations:
    • Adhere to all relevant laws and regulations governing public funds.
    • Stay up-to-date with changes in financial regulations.
  5. Efficiency and Cost Management:
    • Optimize resource allocation to maximize efficiency and minimize waste.
    • Identify cost-saving opportunities without compromising quality.
  6. Revenue Generation:
    • Explore opportunities to generate revenue through various means, such as fees, taxes, or investments.
    • Diversify income sources to reduce dependency on a single revenue stream.
  7. Risk Management:
    • Identify and assess financial risks, including market fluctuations and economic downturns.
    • Develop strategies to mitigate these risks, such as risk-sharing agreements or insurance.
  8. Investment Management:
    • Prudently manage investments to achieve optimal returns while minimizing risks.
    • Diversify investment portfolios to spread risk.
  9. Debt Management:
    • If necessary, use debt responsibly and ensure debt servicing obligations are met.
    • Monitor and manage debt levels to prevent excessive burdens.
  10. Performance Measurement:
    • Establish key performance indicators (KPIs) to evaluate financial performance.
    • Regularly assess financial reports against these KPIs and make necessary adjustments.
  11. Stakeholder Engagement:
    • Engage with stakeholders, including government bodies, shareholders, and the public, to build trust and ensure transparency.
    • Communicate financial information in a clear and understandable manner.
  12. Training and Capacity Building:
    • Invest in the training and development of finance personnel.
    • Ensure staff have the necessary skills to manage public funds effectively.
  13. Technology and Automation:
    • Utilize technology and financial software to streamline financial processes.
    • Improve data accuracy and reporting through automation.
  14. Sustainability and Social Responsibility:
    • Consider the environmental and social impacts of financial decisions.
    • Promote sustainable practices and responsible corporate citizenship.
  15. Continuous Improvement:
    • Continuously assess and refine financial management practices.
    • Adapt to changing economic conditions and industry trends.
  16. Emergency Preparedness:
    • Develop contingency plans for financial crises or emergencies.
    • Establish reserve funds for unexpected expenses.
  17. Ethical Conduct:
    • Promote ethical behavior and a culture of integrity within the organization.
    • Implement and enforce a code of ethics for financial professionals.
  18. Long-Term Planning:
    • Develop long-term financial plans that align with industry and government objectives.
    • Consider the economic and financial landscape over the coming years.

Effective management of public funds in industries requires a holistic approach that balances financial stewardship with broader organizational and societal goals. It’s important to adapt these principles to the specific industry, organization, and economic context in which you operate.