1.1 BACKGROUND OF THE STUDY
Every organisation, whether small, medium or big is
established to achieve specific target objective. Such objective derived from
adequate returns on investment and the ability of the organisation and or, its
representatives maximally provide social service that would meet the immediate
and long term needs of its environment or community.
In order to actualize set objective, organisation employ
adequate and effective accounting records as well as employ the services of
available resources (human or non-human) towards actualizing dreams.
Virtually, every organisation and business minded
individuals take proper records of it’s activities. This is to enable team
measure or ascertain the level of success or failure recorded in the
organisation at a specified period of time. Consequent upon this, one may ask,
how adequate, accurate and reliable are feese records especially they are not
taken by a professional book-keeper or accountant?
Keeping of records is not only required but also vital any
organisation. According to Alayide (2009); inadequate records or failure to
bring the accounting records up-to-date usually leads to commitment of errors
and fraudulent practices. As such, organisation whether in the private or in public
sector, really requires the services of a qualified and certificated accountant
Organisation need to employ the services of professional
accountants and or, book-keepers in order to:
Keep all accounting records.
Set up sound accounting records for staff to follow.
Assist them to keep in closing the books of account where
there is difficulty and or discrepancy.
Prepare and-of-year account or financial report systems to
facilitate clients efficiency in processing management information and
controlling of operation.
Write up accounting and administrative procedure manuals.
Ensure adherence to the internal deck system, and so on.
Wanogho (2006) opined that the services of the accountant to
organisation and individuals among others includes;
Drafting of financial statement incorporating profit and
balance sheet for companies.
Preparation of management account on a regular basis and for
whatever period e.g. yearly, quarterly, six monthly, daily etc.
Preparation of accounts for specialized area as trust
non-profit making organisation charities and pension schemes.
Maintenance of computerized record of clients book of prime
entry from the information supplied.
Preparation of necessary financial information.
1.2 STATEMENT OF THE RESEARCH PROBLEM
The importance of book-keeping and accounting in a profit
making organisation can not be over emphasized or underestimated. But some
small scale enterprises have been faced with some problems which resulted to
These problems are as listed here under:
Lack of permanent and systematic records for financial
transaction by accounting professionals that will ascertain whether the
business has make profit or loss in an accounting period.
Accounts prepared at best are single entry and feese account
proper information regarding assets are lacking.
Accounts prepared by non-professional have no safeguards for
fraud and errors.
Final accounts prepared are not reliable and cannot be
acceptable for tax proposes.
Accounts prepared does not take into cognizance of issues
relating provision for doubtful debt and depreciation.
Financial statement prepared cannot be compared between
periods because the bases of preparation is faulty.
To this end, the study is embarked upon to address these
1.3 RESEARCH QUESTION
For the purpose of getting relevant responses, the study
hereby formulates the under-listed hypothesis.
To what extent can it be said that booking keeping and
accounting practices and services are employed in small scale business
To what extent can it be said that book keeping and
accounting functions are preformed by experts in small scale business
To what extent is the application and expertise use of book
keeping and accounting of small scale business organisations achieve the
What are the major problems faced by business without the
use of professional accountants or book-keepers?
1.4 OBJECTIVE OF THE STUDY
The major purpose of the study is to highlight book-keeping
and accounting practices in small scale enterprise. The study will be of a
great aid to private organisations, both large and small scales to enlighten
them on the importance of book-keeping or recording the day-to-day activities
information in profit making organisation and also to find possible suggestions
of stressing the importance of book-keeping through seminars to our business
organisations and officers managing these firms.