CHAPTER ONE
1.1
INTRODUCTION
In most developing countries
including Nigeria, government participation in economic activity is usually
significant. One of the ways through
which government has intervened in Nigerian economy is through the
establishment of public enterprises and statutory bodies operating services of
an economic or social character on behalf of the government.
Since the colonial era,
especially after independence in 1960, Nigerian public enterprises have
witnessed a steady growth unit recently.
Its Olisa (1988:133) pet it. Beginning as a trickle in the period
between this era of the second world war and Nigeria attainment of independence
the creation of public corporations had risen to flood level since independence
and his maintained a steady growth. The
rational behind the establishment of public enterprises in Nigeria are many. Some of the reason include: generating revenue, they would add to available
rational capital for the support of development and welfare programme, making
to be controlled by a few individual, it
possible for important profitable enterprises to be controlled by a few
individual or group, organization certain critical activities national survival
and economic stability and providing employment opportunities (Ademolukun
1983). However, after a long period of
growing, starts intervention in the Nigerian economy through public enterprises,
the and of 1980’s onwards had witnessed a reversed which has sometimes been
dramatic in public opinion and therefore public policy.
This has been brought by the
persistent losses which state enterprises that have been running over fears.
Consequently, there has been a willingness to look at alternative policy
strategies for the achievement of economic development. At the forefront of these strategies is the
minimization privatization of public enterprises.
In Nigeria, public enterprises are engaged in a while spectrum
of economic activities including agriculture, mining, construction,
manufacturing, commerce and services.
The classification of public enterprises in Nigeria, had been made
according to varieties of criteria by different authorities. The public service review commission (1975:101)
classified public sector int.
Public utilities
Regulatory of service body
Financial institutions
Commercial ad industrial enterprises
Being a mixed economy, individuals
also own and operate private enterprises.
A firm classified as private enterprises when it is founded and managed
by an individual and Ora group of individual.
These firms are expected to be registered in the local government within
which they operate.
The rationale for the establishment
of private enterprises are numerous just like establishment of public
enterprises. T hey include amongst other.
Provision of employment opportunities.
Generating income for the owner
of the enterprises. Government interest
in profit growth of the enterprises which determine the tax liabilities of the
firms, improve the performance of the public sector through competition. Moreover, the general public is concerned
with the contribution which makes towards social upliftment which is exhibited
to the environment in which the business is loaded and its willingness to
contribute to the development of the environment.
The activities of the public
enterprises have been on the increase in resent times which necessitated the
introduction of the accounting practice to check and monitor the financial activities
of these enterprises. In this book,
titled principles of accounting, by Bimage (1985) accounting is defined as a
process by which data relating to the economic activities of an organization
are measured, recorded and communicated to interested parties for analysis and
interpretation.
The earliest method of accounting
records were kept in physical quantities.
These records came from the Eastern (early) civilization which involved
in the countries around the Mediterranean sea such as Mesopotamia, Egypt,
Crete, Italy etc. money was recorded as
soon as money took the place of barter as a medium of exchange and unit of
accounting practice has been closely related to the economic development of the
country. If the business organization
grows in size and complexity, management and outsiders became more clearly
differentiate from the outside groups which include owners of the firm (stock
holder) creditors, government employer and the general public.
The differentiation necessitated the
need to have accounting department in the enterprises to give accurate
financial of the management and to satisfy the outside demands or the general
public who are already interested on whether the enterprises in growing or not.
The role of accounting in public
enterprises in Nigeria is primarily to ensure accurate accountability in these
sector and present the time and fair financial position of the
enterprises. The role is of utmost
importance in any organization. An
organization can only grow or profit when the resources are well managed and
effective observed over expenditure.
These resource can only be well managed if accounting department of the
organization give an accurate financial information to know how ,much the enterprises
having. It is only when this is done
that the firm allocate its resources and knows what is to be done.
The role of accounting seems to be
more pronounced in the public enterprises.
In recent time there are cases of misappropriation of funds in the
public enterprises and improper accountability.
These factors have led to a lot of public enterprises going into
oblivon. If the government has reorganized the role of accounting, all these
febles should not have arisen. No
enterprises can move forward without having a well organized financial
departments to give accurate financial; information about the firm.
This is because if improper
accounting records are not minimized or where possible eradicated these is
bound to be cases of public enterprises failure. Consequently, staff of such enterprises will
forced out of their job. This will
result to economic and social; activities in the society.