Financial Record Maintenance Practices In Business Establishment
In this study, our focus was to carryout a critical analysis on financial record maintenance practices in business establishment. The study adopted the survey research design and randomly enrolled participants in the study. A total of 80 responses were validated from the enrolled participants where all respondent are active workers in registered establishment in Aba, Abia state.
The findings revealed that that there is a significant relationship between storage facilities and record management. The findings also revealed that there is a significant relationship between general policy on information gathering and record keeping. Finally it showed that there is a significant relationship between inadequate care of financial records and impediment of effective records management.
1.1 Background of Study
Finance is very important, it is as old as man and it is pivot on which every business hinges.
Finance is an economic force, a means of economic empowerment or enablement; where withal available to an organization to discharge or settle it’s obligations. It is therefore any or means of settlement. A transaction is said to be financed when it is settled through the payment of money and other credit facilities such as commercial bank loans, bank overdraft, letter of credits, finances of establishment comprise both cash and other liquid resources such as stock, bond, contract right etc, as well as the credit and loan facilities available to the organization (Adapted from Okofor 2003).
To achieve proper financial records, records of transactions must be kept, such financial records of business establishments includes, cash books, Receipt booklets, Bank Account books, ledger account books, invoices and payment books and booklets etc.
For effective management, these records must be kept ready at every point in time when they are needed.
Accounting to right and record institute London (march 2001), Record management is concerned with achieving economy and efficiency in the creation, maintenance use and disposal of the records of an organization and in making the information contain available in support of the business of that organization- the objective is to finish accurate and complete information when it s required.
Financial records in business organization cover greater aspects including control of file movement, location, types equipment, classification, index, procedures access and supervision, follow-up, retention period etc.
Financial record management is to help guide the organization in future. It also helps in providing a base for future action. Data on cost, pay vouchers financial statements, research findings etc. may assist management in future decision making by providing them with evidence for past experiences.
Financial records maintenance help to provide statutory obligation, which the low requires, that the organization keep detailed records about certain areas of the business, there are obligations which have to be met, for instance, recording all business transaction for purpose of value Added Tax (VAT), Taxable income etc. it also show evidence of transactions. Detailed records are needed as a payment record of the inputs and outputs of the organization. It is needful that written records be filed; this is because files are essential for the continual operation of business, which is the memory of a business.
In modern business offices vital decision must be based upon available up to date information. This is to say, risk are too great for the executives, decision to be based up on guesses, heresy etc. thus, a business establishment cannot hope to remain in a competitive field without adequate financial records are the life wire of any organization. The importance of record management cannot be over emphasized, because of the information reason, hence, the researcher bid to find out the effects of poor financial records in some business establishments.
1.2 Statement of Problem
- Lack of storage facilities
- Inadequate care for financial records
- Neglect of filling and records keeping
- Inadequate policy concerning information collection, processing, storage and retrieval.
Financial record maintenance is a pivot for every organization, the research is being undertaken to examine and make yourself clearer important yet neglected area of office management, filling and record keeping is the life wire of any organization. It is recognized as a means of orderly arrangement of letters and records to ensure safe custody and retrieval. The successful execution of record management aid speedy and efficient decision making in an organization, lack of adequate record storage facilities consisting of office space, poor equipment protection, bad management of the record paper and files, tapes, diskette etc. determination of general policy concerning information collection, processing storage and retrieval measures. For our established business to excel administratively there is need to find solution to these problems.
1.3 Purpose Of The Study
The purposes of this study are as follows
- To determine the general policy concerning information collection processing storage and retrieval measure undertaking by business establishments.
- To determine the storage facilities for keeping records, if there are adequate care of records in business establishments.
1.4 Research Questions
- In what way does lack of storage facilities affect record management?
- How does lack of general policy of information gathering, storing and retrieved measures affect record?
- In what way can inadequate care of records impede the effectiveness of records management?
1.5 Research Hypothesis
The following hypotheses were formulated for the purpose of this study.
- Ho- there is no significant relationship between general policy on information gathering and record keeping
Ha- there is significant relationship between general policy on information gathering and record keeping.
- Ho- there is no significant relationship between storage facilities and record management.
Ha- there is significant relationship between storage facilities and record management.
- Ho- there is significant relationship between inadequate care of financial records and impediment of effective records management.
Ha- there is significant relationship between inadequate care of financial records and impediment of effective records management.
1.6 Significant of Study
The study will expose the problems of record management. As soon as the problems are identified, it will call for fast eradication, which makes the study significant.
The result of the study and the literature will generally be useful to business establishment, educational institutions and government for purposes of further research and decision making.
Finally, if the recommendations are adopted there will be remarkable improvement on many business establishments.
1.7 Scope / Limitation of the Study
The academic project of this nature can start and reach completion inch free without some hindrances. Due to the limited time available for both classroom work and the project it is pretty difficult to reach out for several things that would have remain relevant to this work but the limitations notwithstanding the available literature on financial record maintenance practices and questionnaires were combined to collect data managers secretaries accountants, cashers, receptionists of the five (5) selected business establishments in Aba Abia state to make this project to reach a readable standard.
This work is limited to five business establishment in Aba Abia State.
1.9 Definitions of Terms
This is the first important task in the process of sound financial management. It involves the activates embarked upon by an officer throughout the complete cycle of information from its creation. Utilization maintenance and financial disposition.
This is keeping documents in a safe place and being able to find them easily and quickly also a system of arrangement, storing business paper in a neat, orderly, and efficient manner so that they may be located readily when needed.
Accounting involves the creation of financial records of business transactions, flows of finance the process of creating wealth in an organization, and the financial position of a business at a particular moment in time.
This is where business is conducted, goods are made or stored or processed or where services are rendered. It can be refer to a sole proprietorship, partnership and limited liability companies.
This discuss how finance is an economy force, the means of an economy empowerment or enablement, the were withal available to an organization to discharge or settle its obligation. It states the problem of the study, the purpose of the research question, research hypothesis, the scope and delimitation of the study and definition of terms.
Conclusion and Recommendation
In this study, our focus was to carryout a critical analysis on financial record maintenance practices in business establishment. The study specifically was aimed at ascertaining the general policy concerning information collection processing storage and retrieval measure undertaking by business establishments.
The study adopted the survey research design and randomly enrolled participants in the study. A total of 80 responses were validated from the enrolled participants where all respondent are active workers in registered establishment in Aba, Abia state.
The findings revealed that that there is a significant relationship between storage facilities and record management.
The findings also revealed that there is a significant relationship between general policy on information gathering and record keeping. Finally it showed that there is a significant relationship between inadequate care of financial records and impediment of effective records management.
The study therefore, recommends that adequate implementation should be given to those existing control yardsticks, as it can help to prevent fraud in the public sector. A good system of internal control should be put in place, as well as the recommendation of Committee of Sponsoring Organization should be duly considered. These includes: a good control environment, a good accounting system, good control activities, monitoring, and good communication and information.
Finally, hiring honest people and provision of fraud awareness training as well as engagement of forensic experts are also essential. The acceptance of forensic experts to the public sector would help her to actualize her goals and objectives. Tone at the top management should be taken serious and lead by good labeling and modeling.
Financial Record Maintenance Practices In Business Establishment
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