The Impact Of Public Sector Accounting On Government Revenue Generation And Expenditure Control On Public Funds (A Case Study Of The Ministry Of Finance Imo State)

Project and Seminar Material for Accountancy / Accounting

The Impact Of Public Sector Accounting On Government Revenue Generation And Expenditure Control On Public Funds (A Case Study Of The Ministry Of Finance Imo State)


Abstract


This study was carried out to examine the impact of public sector accounting on government revenue generation and expenditure control on public funds using the ministry of finance, Imo state as a case study. To achieve this, 4 significant research objectives were formulated. The survey design was adopted and the simple random sampling techniques were employed in this study. The population size comprise of staff of ministry of finance, Imo state.In determining the sample size, the researcher conveniently selected 114respondents while 110 were received and 100 were validated. Self-constructed and validated questionnaire was used for data collection. The collected and validated questionnaires were analyzed using frequency tables and percentage. The result of the findings reveals that the revenues accruing to the government are not properly recorded. The findings also revealed that the observation of due processes helps in the execution of government plans. And the exercise of expenditure control helps the government to make expenses that are wholly, necessarily, reasonably and exclusively. In regard to the findings, the study recommends that an account committee should be set up to control and regulate the accounting system of the public sectors to ensure there is a proper record of the generated revenue by the account officers since most top officers in conjunction with their supervisors collaborates and enrich themselves with the public fund.


Chapter One


Introduction

1.1 Background of the Study

Public sector consist of organizations where control lies in the hand of the public as opposed to private owners, and whose objectives involves the provision of services where profit is not a primary objective. According to Ofurum (2015)comparisons between the financial performance of the public sector and that of the private sector are difficult to make because the public sector organizations multi-purpose, not dealing with single product or services, and they have different sources of finance performance in measurement in the public sector is hindered by lack of profit motive.

Public sector financial management is hinged on pursuing policies that are geared towards the attainment of overall economic development of a nation. It addresses core objectives that include but not limited to economic and governance reform projects of government, utilizing principles of monetary discipline, legitimacy, predictability, transparency and accountability to reform and strengthen public finances. Well-designed and effectively implemented financial policies hold a great deal of promise. They help to contain helpless service delivery, enhancement of equity, minimization of debasement, reduction in deficit inclination, and time inconsistency of budgetary policies. It also helps to, strengthen the credibility of government’s commitment to financial manageability and along these lines facilitate countercyclical monetary management. By increasing the predictability of financial arrangement, monetary rules can likewise lower yield instability and lift long haul development ( Jinghan 1990).

Given that the resources for attainment of economic development are relatively scarce, concerted efforts are usually made to ascertain areas of greatest needs where resources could be channeled to, so as to have the greatest satisfaction. According Olaoye and Olaniyan (2020), the theory of public sector should focus on how government should source and utilize funds.The major goal of government is how to raise enough fund to carryout its objectives because they are numerous. Government its objectives because they are numerous. Government has its duties to perform and they need sufficient fund to perform its functions as affect the economy as a whole that is why, the Nigeria government should try and see that at least more than half of its proposal every year is being achieved.


1.2 Statement of the Problem

In public sector, the government has to live and perform its duties to the nation. As a result there must be a mass of livelihood called money. Also this money generated by government has to be spend appropriately and wisely to avoid mis-management of fund.

Therefore, this research work intends to know the impact of public sector accounting on:

  1. Where government generates its revenue
  2. How to utilize the money
  3. How to keep the money
  4. The effect of expenditure control on public fund.

1.3 Objectives of the Study:

The basic objective of the government in the society is to ensure the highest degree of Happiness and contentment or largest number of people in the society.

With regards to the above statement, the objectives of this study are as follows:

  1. To find out whether the revenue accruing to the government are properly recorded.
  2. To observe the need for due process in executing government plans.
  3. To establish a proper system of accounting record in the effective management of the sector.
  4. To establish expenditure control in order to ensure that all expenditures are wholly, necessarily, reasonably and exclusively incurred for the purpose for which they are meant for.

1.4 Research Question:

In order to carryout this study effectively, the objectives and sources of the problems associated with the study gave rise to those research question.

  1. Are the revenues accruing to the government properly recorded?
  2. Does the observation of due process help in the execution of government plans?
  3. Does proper system of accounting record help in the effective management of the sector?
  4. Does the exercise of expenditure control help the government to make expenses that are wholly, necessarily, reasonably and exclusively?

1.5 Scope of the Study

The scope of the research is to cover adequately all aspect of revenue generation and expenditure control in government parastatals, but due to the vastness of the scope, the researcher restricted the scope of the study to the ministry of finance Imo State.


1.6 Need for the Study:

This study will enable the citizens to know the importance of expenditure control on public funds, and also to ensure that a sound system of accounting record are kept in various ministries of the government.


1.7 Limitations of the Study:

In carrying out the research work, the following limitations and constrains were encountered by the researcher.

1. Inadequate Information:

It was not easy for the management and staff of the ministry f finance to disclose all information needed in this research, duties to current happenings and for security reasons.

2. Finance:

As a student who is still dependent on the parents to provide all financial needs, the money involved in carrying this research work was not enough.

3. Time:

The research is time consuming, as a student who has other things to do, time constraint do not invalidate this work.


1.8 Definition of Terms:

Account:

A formal record of a transaction expressed in money and kept in a journal. It is popularly called the language off the business.

Analyzing:

This is the procedure of separating transaction into relevant parts.

Classifying:

This is the classification of revenue and predetermined expenditure into account groups according to predetermined codes, that is revenue head and sub head.

Communicating:

This is the communication of the out come of the operations on the financial data of the government to intended users.

Expenditure Control:

This is the procedure that is needed to regulate the use of public fund and to ensure proper authorizations of the government spending.

Expenditure:

This is the outflow of resources or the incurring of obligations for goods and services required to generate funds.

Fraud:

A deceptive trick planned to obtain an unjust or illegal financial advantages .

Fund:

This is a separate fiscal and accounting entity governed by specific regulations separated from other funds and established for a specific purpose.

Fund Management:

This means efficient and effective use of organizational money or funds to achieve the objectives of which the fund was given issued.

Interpreting:

This is the interpretation of the meaning of the financial statement on the activities of the various levels of government.

Public Sector Accounting:

This is the process of recording, communicating, summarizing, Analyzing and interpreting government financial statement in aggregate and in details reflecting all transactions in the receipts, custody and disbursement of government fund.

Recording:

This is the documentation of financial transactions and events affecting the various units in to appropriate books of account.

Parastatals:

These are some of the administrative groups of government such as ministries authority’s statutory corporations and agencies whose intentions and objectives is not profit oriented.

Public Revenue:

This referees to the income accruing to the government from the performance of its economic activities.

Public Expenditure:

This also refers to the expenses which the government incurs for maintaining itself and the economy as a whole.

Summarizing:

This is the gathering of data into sub-total and totals in accordance with the management specification


Chapter Five


Summary, Conclusions and Recommendations:

5.1 Introduction

This chapter summarizes the findings on the impact of public sector accounting on government revenue generation and expenditure control on public funds using the ministry of finance, Imo state as a case study. The chapter consists of summary of the study, conclusions, and recommendations.


5.2 Summary of the Study

In this study, our focus was on the impact of public sector accounting on government revenue generation and expenditure control on public funds using the ministry of finance, Imo state as a case study. The study is was specifically carried out to; find out whether the revenue accruing to the government are properly recorded, observe the need for due process in executing government plans, establish a proper system of accounting record in the effective management of the sector, and establish expenditure control in order to ensure that all expenditures are wholly, necessarily, reasonably and exclusively incurred for the purpose for which they are meant for.

The study adopted the survey research design and randomly enrolled participants in the study. A total of 100 responses were validated from the enrolled participants where all respondent were staff of ministry of finance, Imo state.


5.3 Conclusions

Based on the findings of this study, the researcher concluded that;

  1. The revenues accruing to the government are not properly recorded.
  2. The observation of due processes helps in the execution of government plans.
  3. Proper system of accounting record helps in the effective management of the sector.
  4. The exercise of expenditure control helps the government to make expenses that are wholly, necessarily, reasonably and exclusively.

5.4 Recommendations

Based on the findings of the study, the following recommendations are proffered.

  1. An account committee should be set up to control and regulate the accounting system of the public sectors to ensure there is a proper record of the generated revenue by the account officers since most top officers in conjunction with their supervisors collaborates and enrich themselves with the public fund.
  2. The top authority should endeavor to look into its administrative activities regularly and then prosecute any officer(s) found embezzling public funds and also make the head of the account office answerable for any such misappropriation.
  3. The relevant authorities should set up a disciplinary committee to punish defaulters especially the head of account department after which they should be handed over to “economic and financial crime commission” EFCC for proper examination and prosecution as this will put fear into the minds of the in-coming staff or the head of account department.

The Impact Of Public Sector Accounting On Government Revenue Generation And Expenditure Control On Public Funds (A Case Study Of The Ministry Of Finance Imo State)


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