Financial Control And Accountability In Public Sector

Project and Seminar material for Accountancy

Project and Seminar material for Accountancy


Abstract


Financial control and accountability in public sector involves giving proper account of government funds and resources. It was discovered that the problems of accountability and control make it impossible for the set objectives of an organization to be achieved. These problems involve the ministries not adhering to set our regulations for proper allocation of government resources.

The objective of financial control and accountability is to ensure that expenditure is properly authorized and adequate attention is given to collection of debts and revenue.

Every public organization should maintain effective accounting information, which must be timely for decision making in the organization.

The research work reveals truth that there is a system of financial control and accountability in Imo and Abia ministries of finance.

Finally, review of internal control system, training and improvement of workers condition were recommended by the researcher as a means of improving effectiveness and efficiency.


Table Of Content


Preliminary Page(s)

  • Title page
  • Approval Page
  • Certification page
  • Dedication
  • Acknowledgement
  • Abstract
  • Table of content

Chapter One

1.0 Introduction

  • 1.1 The ministry of finance
  • 1.2 The commissioner of finance
  • 1.3 The state Accountant General
  • 1.4 Statement of problem
  • 1.5 Scope/Limitation of the Study
  • 1.6 Definition of Terms Operational

Chapter Two

2.0 Review of Related Literature

  • 2.1 The Nature of Public Finance
  • 2.2 The Financial Regulation (FR)
  • 2.3 Budgetary Control
  • 2.4 Internal Control in the Public Sector
  • 2.5 The Role of Financial Control and Accountability in the Sector

Chapter Three

3.0 Research Methodology

  • 3.1 Research Design
  • 3.2 Sources of Data
  • 3.3 Population of the Study
  • 3.4 Sample and Sampling Size
  • 3.5 Methodology of Data Collection
  • 3.5.1 Primary Data
  • 3.5.2 Secondary Data
  • 3.6 Method of Data Analysis

Chapter Four

4.0 Data Presentation, Analysis and Interpretation

  • 4.1 General Characteristic of Responses
  • 4.2 Presentation of Data

Chapter Five

5.0 Summary, Conclusion and Recommendation

  • 5.1 Summary of Finding
  • 5.2 Conclusion
  • 5.3 Recommendation
  • Bibliography
  • Appendix
  • Questionnaire

Chapter One


1.0 Introduction

Almost all workers in the civil service especially those involved in government Finance Operations are well acquainted with financial control or at least some aspect of it. Some terminology like fund control, budgetary control, capital expenditure e.t.c. is not strange to most of these workers.

However, without doubt, one could say that very few understand the nature, need for objectives and efficiency of the financial system in government. Public accountability is not a new phenomenon. It is as old as man in his social relations with others. This is so because in ancient times. The account of estate, domains was examined by reading them out by those who compiled them to the persons in authority.

Thus, there was an element of answerability. This illustrates the stewardship function of accountability in government.

Today, public finance assesses whether one use of allocation of resources is better or yields more benefit than another. This makes public accountability more complex with serious consequences especially when decisions taken by public officer are brought under open and public examination.


1.1 The Ministry Of Finance

As it is in Federal Setting, a state ministry of finance is pivoted because of the roles it performs in relation to other ministries and parastatals of government. It is one of the every large ministry in the bureaucratic system of government.

Ministry is basically concerned with financial administration and the execution of government financial policies, which have been handed down in conformity with the national objectives of maintaining economics and monetary stability while pursuing sustained growth of the nation’s economy. The ministry in carrying out its role of financial administration ends at the following among others.

  1. The development initiatives for the formulation of policies on fiscal and monetary matters.
  2. The harvesting and mobilization of internal financial resources development.
  3. The supervision and control of ministries departments and agencies of government in financial matters, Oshisami (1992).

1.2 The Commissioner For Finance

The commissioner for finance is the head of the state ministry for finance. Under the 1979 Federal Republic of Nigeria Constitution, the governor was the only recognized public office holder in the state as all others held offices in his pleasure.

The commissioner had no direct responsibility in law except that vested in him by the governor of state. However, civil service reforms (1988) brought about major changes in the administration and financial machinery in the public sector.

The changes are as follows:

  1. Each ministry of the government was given considerable autonomy in administration and financial matters.
  2. The commissioner was made the chief executive or chief accounting officer of the ministry, a function that was formerly vested in the permanent secretaries previously called director general.
  3. The budget department was hired-off the ministry of finance and transferred to the government office.

Generally, under any type of administrations whether military, parliamentary or presidential systems, the commissioner performs the following functions by virtue of the 1989 civil service reforms that made all ministries administratively and financially autonomous.

  1. Receipts and disbursement of government fund.
  2. Overseeing other ministries, reports are sent from ministries to ministry of finance by way of weekly. Monthly expenditure/ revenue returns.

1.3 The State Accounting General

The functionary is the head of state treasury department among others. He is responsible of all ministries and department within the Federal (State) and for compilation of financial statements of government . Oshisami (1992).
The Financial Regulation (FR) list many other specific duties of the accountant general of the Federation, many of which applied to the state.

Accountant general FR 24 (a) madates him to list in his Annual report; the “returns of arrears of revenue” FR 1.103 shows she should advise accounting officer when he receives the general interest warrant without which no interest money can be issued. The accountant-general should also cause inspection to be made to the accounts kept by accounting officers controlling expenditure, federal pay officer (sub-treasuries in state) sub accounting officer , interest holders, revenue collectors and other officer having monetary or financial responsibility. He is endowed with certain powers to write-off hoses of finds (FR 1506).

There are other situations in which the express approval of the accountant general is required before certain actions or procedures can be carried out. These are spelt out in the financial regulating and they include:-

  1. The opening of bank accounts.
  2. The opening of advance –non-personal account.
  3. The variation to an existing procedure.

Accounting to the civil service (re-organization decree 1980) the functions of the accountant general include/training the accounting officer of the government.


1.4 Statement Of Problem

In the ministry there are some stipulated principles laid down by the government for effective financial control and accountability. Some of which are the constitution of federal republic of Nigeria. The financial regulation, instruction and budgetary control. Financial at control and accountability in Nigeria public sector organization is faced with a lot of problem. This is especially so in view of the public belief that there is a lot of embezzlement and other forms of financial recklessness going on in government ministries and departments.

The problems are, do their ministries adhere to principles led down by government for proper allocation and distributing of resources are government funds property controlled and accounted for in accordance to stipulated standard? Are the resources used judiciously in a manner beneficial to the entire populace and for the good of the society?


1.5 Scope / Limitations Of Study

The study is restricted to the Imo and Abia State ministries of finance, including impact of accountant-generals office in the ministry. This work will also look into the internal control system in the Imo and Abia ministries of finance to evaluate its effectiveness, efficiency and economy.

The limitation to the research work includes the uncooperative attitude of the respondents who were not willing to give confidential information and sometimes- based answers were given. Most of information and data needed for the research work were not easy to gather because some respondents believe that the information involved in gathering and processing the data into meaningful information was also short.


1.6 Operational Definition Of Terms

Budget: –

A budget is a plan of financial operation stating an estimate of proposes expenditure for a given period and the proposed means of financing it.

Accountability: –

This simply means answerability that is a requirement on public servant entrusted with certain financial responsibilities to render an account of or answer for their actions to their superior officers.

Financial Control: –

It is the process which assures that financial resources are obtained economically and utilized efficiently and effectively in the attainment of the desired goals.

Internal Control:-

This simply means as the whole system of controls, financial and otherwise ;, established by the management in order to carry on the business of the enterprise in and orderly and efficient manner, ensure adherence to management policies, safeguard the assets and secure as far as possible the completeness and accuracy of the records.

Government Finance:

Government finance refers to the wide range of activities undertaken by government in financial and economic matters.

Public Sector Auditing: –

It is an independent examination of, and expression of opinion of the financial statement of an enterprise, by an appointed auditor in pursuance of that appointment and in compliance with any relevant statutory obligation.

Compensating Balance:

It is the amount usually stated in percentage payable by a customer to the Bank on the amount borrowed under a revolving credit agreement.

Objectivity:

It is a state of mind, which has regards to all considerations relevant to he matter or task on hand and no other.

Cash Audit:

It is simply means the determination of the appropriate cash Balance at the Balance Sheet date so as to know whether the internal controls for cash/cash transactions are efficient and effective.

Commitment Fee:

This simply means the amount also stated in percentage payable by a customer on the unused portion on the fund under revolving credit agreement.


Chapter Five


5.0 Summary, Conclusion And Recommendation

5.1 Summary Of Findings

In chapter one, the researcher treated the introductory aspect of the subject matter, where the aim of the ministry of finance of elaborated. The position of the commission for finance was looked into also the position of the accountant general as the functionary head of state treasuring department, responsibility for the general supervision of the researcher went further to give various definition and terminology involved in financial control and accountability in the public sector.

In chapter two, the review of related literature on the subject matter and the nature of public finance as the organ which deals with the public money. It discussed the financial regulation, budgetary control, internal control in the public sector, and the role of financial control and accounting manual, finally public accounts committee and its functions.


5.2 Conclusion

In conclusion, this research work reveals the undisputed truth that there is a system of financial control and accountability in Imo and Abia ministry of finance.

However, it is worthy to not that in as much as it is important to have the materials, land units needs to ensure financial control and accountability. It is more important to ensure them are optimally used.

The human factor plays an important role in these regards the systems are being operated by human to achieve the purpose for which they are put in place.

The researcher further concludes that the system of financial control and accountability in Imo and Abia ministries of finance is grossly inadequate. The ministrative framework as well as effectiveness of the audit department as determines the public sector organization especially government ministries.

Thus, there is need for prompt examination of financial transaction organizational arrangement of government establishments.


5.3 Recommendations

To remedy the inadequacy of the financial control and accountability in the ministry of financial, the following action were recommended by the researcher.

  1. The ministry should increase the payment of her staff.
  2. There should be adequate facilities for work, such as computer, which fasten the work and more effective for supply of information to management.
  3. Internal control system should help internal auditor perform their work properly. The auditors should adequately remunerate and provided with necessary incentive to enhance performance.
  4. There is need to install a sound system of internal duties that should be properly segregated clearly.
  5. The ministry should from time to time organize workshops, seminars to provide on the job training for all members of staff especially the junior staff to acquaint them with the provision or relevant legislator and other changes in accounting techniques.
  6. The commissioner should also ensure that there is compliance with relevant legislation and other internal guide’s e.g. ministries accounting code, land manual.

Financial Control And Accountability In Public Sector


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