This project is aimed at looking into the accounting profession in details and examining its role in societal development.
A study of the evolution of accounting suggests that
accounting processes are reactive because they have developed primarily
in response to business needs. Also the development of accounting
process has been related to economic progress and societal development
of a country.
History shows that the higher the level of Civilization or
development, this more elaborate and wider the accounting method
Since Picoli’s days to this present day, accounting has recorded a
lot of tremendous changes and growth all over the universe. For instance
during the first sixty years of the twentieth century, a major economic
and societal force had thrown the accounting profession into new
frontiers and responsibilities. The factors contributing to this growth
are the increase in the population of large corporate business in the
affairs of business by way of taxation and business regulations,
technological advancement especially in the area of computerization –
which has rapidly changed the process of data procession. These
factors, to a great extent, have deeply contributed tot he development
of the accounting profession over the years.
The role of computer in the accounting profession has facilitated the
traditional functions such as payroll, cost accounting and general
It is also being used for analytical purposes such as forecasting, cost benefit, analysis, etc.
As professionals, accountants are expected to demonstrate a
responsibility tot he public services above their commitment to personal
economic gains. Accountants recognize that the special esteem. They
enjoy obligates them to work for the improvement of society.
Complimenting their obligation to society, accountants have analytical
and evaluative skills needed in the solution of the over-growing
problems of the universe. The special abilities of accountants as well
as their independence and ethical standards, permit them to make
significant and unique contribution in such areas as protecting the
public interest, preserving environment interest and controlling and
improving public programmes.
In recent times, the work of accountants increased in scope.
The reward as added to the accounting profession include installation
of accounting system, auditing and investigation management of social
activities and host of others.
It is also of importance to note that the increase in the scope of
accounting give rise to complex problems, which accountants must
encounter. This is why competent accountants are needed in the various
areas (i.e. to ease the accounting problems facing the management of
companies and the society in general).
Apart from providing accounting information, the accountant also
gives his opinion on a wide range of representations such as sales
statistics, lease agreement, etc. or the fact that, accounting is not
only for the good of the individual accountants have to be conscious of
the society’s benefit. This is because social responsibility and
service tot he public is the major objective of the accounting
Thus, there is the need for the accountants to develop a social
attitude towards their profession. Recall that the accountant is duty
bound to exercise his duties with reasonable care, skill and diligence.
He must offer his integrity and reputation to the public, which relies
on his judgment and pinion.
1.2 OBJECTIVE OF STUDY
In view of the purpose of accounting and how it affects the society
generally, this study is designed to achieve the following objectives.
- Identify the users of accounting information
- Highlight the importance of accounting information to its various users
- Highlight the role played by accountants toward providing accounting information to its users
- The contributions of the accounting information towards societal development
1.3 SIGNIFICANCE OF STUDY
It is hoped that this study when completed will
- Be able educate the management of firms on how important it is to
tailor their accounting information requirement in such a way that they
can take decisions which will help maximum the objective(s) of the
- Be able to educate shareholders (prospective ones inclusive) on how
to watch out for profitable and viable firms in which to invest their
- Provide prospective employees with information that will enable them
look out for companies that can offer them safe employment through
growth over the period of time;
- Equip trade uncoils with methods of calculating the claims for higher wages and better conditions for labour
- provide creditors with the acid test with which to know if a prospective debtor can keep can keep to the terms of credit;
- assist the government and its agents on effective revenue generation and allocation;
- help consumers to use accounting data to asses the viability of a company (with respect to long term contracts);
- sensitizes comptitors towards using accounting information for purposes of companies;
- Bring accountants to remembrance in respect to their roles in societal development.
1.4 STATEMENT OF PROBLEM
The accountancy profession is faced with ‘teething’ problems, some of which include:
- Professional Abuse and Indiscipline: This is where an accountant
(for instance) fails to keep to the ethics of the accounting profession.
The accountant here forgets that the owes a fiduciary responsibility to
his clients and the public in general. Cases of this comes up where
accountants encourage their clients to void paying the tax they should
be intentionally declaring a huge operating loss for tax purposes where
the client actually made profit during the basis period of assessment.
This false declaration does not only obtain for tax purposes. You also
see it where in a bid to help their client obtain loans from financial
institutions, accountants falsely declare very high profits in order to
enhance their client’s opportunity of obtaining loan.
- Imposition by Management and Top Government Officials: Offer times,
accountants are reduced to the level of terms paper tigers. They can
only bank but cannot bite. They are threatened by these officials.
Failure to keep to such an injunction may lead tot he disengage of the
accountant’s duties (or even death). As a result, accountants keep
closed eyes on such situations.
- Inadequate Internal Control System: Failure to install and
implement an adequate internal control system hampers effective
auditing. This is because there are no proper checks and balances
established to curb the excesses of the management and staff of an
- Inadequate Method of Data Processing: Nigeria is still faced with
the problem of the manual system of recording and processing financial
data into usable information. This system, as we know is very tedious
and prone to error(s).
The computer; till data, is still out of the reach of may
organization (especially the small scale business) due to its exorbitant
each outlay. If this were to be made available to interested buyers at
subsisted amounts, the headache associated with the manual system of
operation will be reduced to the barest minimum.
- The Institute of Chartered Accountant of Nigeria (ICAN): This body
is among the problems to reckon with so long as the accounting
profession is concerned. Many a time, graduate accountants are denied
jobs because they do not have a certificate to show that they are
members of this body. In recent times, it row seems as if it would be
easier for a camel to pass the ICAN Exams. As a matter of fact, persons
who though chartered in some other country but somehow finds themselves
here in Nigeria, are not recognized as professional accountants until
they charter with the ICAN.
These are the problems (among many others) that the
researcher can mention. These and other similar problems cannot be
solved without a research of this kind. Hence in study, the researcher
would advance solution to the problems and t the same time make very
useful recommendations that will both alleviate these problems and
enhance the prospects of the role of accounting in the development of
the Nigerian society.
1.5 HYPOTHESIS FORMULATION
With regard to the problems identified above as well as the objective
of the study, the researcher has these propositions to make:
Ho: Accounting information is not important to its users.
Hi: Accounting information is important to its users
Ho: Nigerian accountants have not been participating in social development.
Hi: Nigerian accountants have been participating in societal development.
Ho: Accounting information is insignificant to societal development.
Hi: Accounting information is significant to societal development.
Ho: Adequate internal control system is not necessary in the provision of accounting information.
Hi: Adequate internal control system is necessary for reliable accounting information.
1.6 SCOPE AND LIMITATION OF THE STUDY
The study will cover the externalist trade of accounting, the
purpose of accounting, the users of accounting information, the
problems facing accountants in the present day Nigeria and the role of
accounting in societal development (in Nigeria).
This researcher work was constrained by academic workload, inadequate
finance, time and other ancillary problems. The data required for this
work was not easy to get because the respondents, though co-operative,
were not always available when their assistance was needed.
Nevertheless, it is hoped that the study will represent the
role played by the accounting profession in societal development. The
conclusive drawn from the researcher is hoped to be of empirical
relevance to the people of Nigeria.
1.7 DEFINITION OF TERMS
This is a state of being in difficulty by a bank as a result of lack of money.
A plan expressed in financial terms, which covers a period,
usually one year and contains the income and expenditure of an
organization within the period as well as policy to be pursued during
the period for the attainment of the set standard.
A company or individual to which an accountant owes a
profession duty to render special service which is under a contract term
for a period.