The Use Of Management Accounting Information In Decision Making Of Manufacturing Industries (A Case Study Of Dauphin Nigeria Limited, Lagos)

Project and Seminar material for Accountancy

Project and Seminar material for Accountancy


This study critically evaluates the importance of application in use of management Accounting in decision making in manufacturing industries.

May industries run the risk of liquidation being taking, their business, due to inadequate knowledge of application of use of management techniques. It is against the background that the researcher decides to embark on this work to find out two managers can make use of management techniques for decision making and enhance their efficiencies.

The study is divided into five chapters, chapter one deals with the introduction, chapter two dealt extensively on the review of the related literature, chapter three treats the research design and methodology, while chapter four focus on data presentation and analysis, and chapter five contains the summary of findings, conclusion and area of further study and recommendations.


Efforts have been made by organizations to rectify the problems found in this firms pertaining to decision-making. Some decisions have altered the requirements of the firms objectives and goals. This work is sought to appraise the use of management accounting to information in decision making of mainly the manufacturing industries.

A hypothesis showing that management null hypothesis showing that management accounting information is not effective and efficient in business decision making while the alternative hypothesis said management accounting information is relevant for effective and efficient decision making. Some research findings were made showing how needful management accounting information is.

In order to analyze and present the data instrument like personal interview and questionnaire were highlighted. The research dispatched forty questionnaires of which twenty five where returned and use. Hypothesis was tested using shi-square method.

It was proved that management receive insufficient accounting information of which improvement is required in view of the above that can only be useful and effective if it is timely and relevant. Management should endeavor to employ more qualified accountants.

Table Of Contents

Preliminary Page(s)

  • Title page
  • Approval page
  • Dedication
  • Acknowledgement
  • Abstract
  • Table of contents

Chapter One

1.0 Introduction

  • 1.1 background of the study
  • 1.2 Statement of the problem
  • 1.3 objectives of the study
  • 1.4 Research questions
  • 1.5 Significant of the study
  • 1.6 Statement of the hypothesis
  • 1.7 Scope of the study
  • 1.8 Limitation of study.
  • 1.9 Definition of terms

Chapter Two

2.0 Literature Review

  • 2.1 introduction
  • 2.2 Management accounting information
  • 2.3 Management need for information
  • 2.4 major features of management accounting
  • 2.5 Decision making and management accounting
  • 2.6 Types of Decision making
  • 2.7 Importance of management decision making
  • 2.8 Objectives of Decision making process
  • 2.9 Steps in decision making
  • 2.10 Accounting information and management in decision making
  • 2.11 Techniques in decision making
  • 2.12 Functions of the management accounting
  • 2.13 Problems of the use of accounting

Chapter Three

3.0 Research Methodology and Design

  • 3.1 research design
  • 3.2 Sources/methods of data collection
  • 3.3 population and sample size
  • 3.4 Sample technique
  • 3.5 Validity and reliability of measuring instrument
  • 2.6 Method of data analysis

Chapter Four

4.0 Presentation and Analysis of Data

  • 4.1 Introduction
  • 4.2 Presentation of data
  • 4.3 Analysis of data
  • 4.4 Test of hypothesis
  • 4.5 Interpretation of result(s)

Chapter Five

5.0 Summary, Conclusion and Recommendation

  • 5.1 Introduction
  • 5.2 Summary
  • 5.3 Conclusion
  • 5.4 Recommendation
  • References
  • Appendix
  • Questionnaire

Chapter One

1.0 Introduction

Management has been described as a process by which systems are administered Igbochi (1990) stated the transformation of resource inputs to produce output give more logical reason for the existence of the management.

On the other hand, management can be looked upon as a body of knowledge representing what managers do.
Management generally is a process composed of functions that are inter related and inter dependent.

Administratively, the managerial functions involves planning, and controlling, staffing and motivating under planning.

The management of every business organization has two major objectives to pursue in order to ensure the continued existence of the business. The first is to maximize profit, and the other is to maximize wealth that is to stay solvent, or to have sufficient cash to settle debts as they fall due.

The management accounting sees that all the necessary information required by the manager for decision making is supplied.

Decision making has been described as a purposeful choosing from a number of alternative courses of action. In deciding which alternative to choose, the manager will desire all the information which is relevant to the decision and then have some criterion on the basis of which he can choose the best alternative. Although, the information needed by the manager is being supplied, its has been less enthusiastic, and hence this research is aimed at findings information under utilization.

1.1 Background Of The Study

From the beginning in 1992 Dauphin Nigeria limited has establish into a successful manufacturing concerned, special thanks to Sir Chima Emeyeonu, who had the incited to foresee the potential of a vast market for locally produced leader products such as ladies hand bags, all kind of suitcases, leader sandals, both in Nigeria and sub region.

Over the years, the company has diversified and expanded its operation to include the production of gum adhesive polythene and synthetic products. It is also involves in a hotel business.

The company has some factories in Lagos. However the manufacturing of its products are carried out. The company has its administrative head office situated at no 83 Hire, Road Surulere, Lagos State.

The company also has over two hundred employees in its manufacturing sites in addition to about twenty staffs at its head office. Dauphin Nigeria Limited is a very typical example of a modern manufacturing concern, hence is selected as a case study of this research.

1.2 Statement Of Problem

One of the most functions of management is to make decision. However, the acquisition and proper utilization of accounting information has always been faced with problems which are out lined as follows

  1. Accounting information are some times provided by people who lack management expertise. They are inexperienced and unqualified persons and therefore cannot form the basis of management decision.
  2. Some of the information provided by the management accountants are not timely and relevant. There is no detailed understand of the business concern and no presentation of information as well enable the managers not to waste time on routine activities.
  3. Accurate and timely accounting information are provided, managers do not make adequate use of the information provided by which reference can be drawn also create a problem.
  4. Ineffective use accounting information became mere planning when Glantter Etal (1992) stated this “even when managers make the right decision” may be the managers are not given accounting its rightful place in decision making.

1.3 Objectives Of The Study

This research is aimed at examining how effective and efficient management apply accounting information in making organization decision.

The main purpose of this is to ascertain the role played by the use of accurate an qualitative accounting information in decision making process.

Procedures and its implementation could be improved for the native of the typos of accounting information supplied to companies, for decision making.

Looking into the extent to which managers neglect using accounting information is their decision making activities.

1.4 Research Questions

  • Purpose of management accounting in decision making of manufacturing industries.
  • The objectives of management accounting in decision making of manufacturing industries.
  • Relationship between management accounting information.
  • The management process and accounting information.
  • The process of management decision making.
  • What are the concept and practices of budgeting?
  • What are the purpose of budgeting?
  • The objectives of budgetary planning process.
  • Difference between forecasts and Budgets.

1.5 Significant Of The Study

Accounting to Nworji (1992) management accounting as a special tool helps the executives in their enormous task of making decision on how best to run an organization to achieve its goals of optimal profitability information is to business what blood is to the human body. Any insufficiency in its or improper flow of it causes a great problem to the system as a whole.

This research study will be beneficial to the decision maker who knows when and where to apply management accounting information in decision of which better decision can be taken.

Also the study can benefit all those who have financial interest in a business. A better business service to increase profit and business expansion. This will likely lead to and increase on profit.

1.6 Statement Of The Hypothesis

The following hypothesis are formulated in other to determine the validity and reliability of the information gathered.

1) Null Hypothesis (Ho)

Management accounting is not relevant for effective and efficient organization decision making.

Alternative Hypothesis (Hi)

Management accounting is relevant for effective and efficient organization decision making.

2) Null Hypothesis (Ho)

Management do not apply accounting information supplied by accountant decision making.

Alternative Hypothesis (Hi)

Management apply accounting information supplied by accountant decision making.

3) Null Hypothesis (Ho)

Accountant has no way in enhance in the management of the company.

Alternative Hypothesis (Hi)

Accountant has many ways enhanced in the management of the company.

1.7 Scope Of The Study

The scope of this study is centered on Dauphin Nigeria Limited, Lagos. Alternative was concentrated to only the relevant management accounting information that were useful for efficient and effective decision making.

1.8 Limitation Of The Study

This work is by means exclusive but useful attempts to penetrate the core of the issue have many difficulties in the researcher accounting data for this research. These problems invariable formed the basis for limitation of the study.

Firstly, time constraint affected a comprehension review of related literature on the subject matter of the study. Gathering of materials, text books, journals etc for the review of literature was time consuming. The researcher being a student has other course to cover and thus had to apportion her time to meet. Secondly, the proximity of related literature materials also posed a problem. The researcher was impeded by necessary text books, magazines and journals for literature review.

Furthermore, the respondents also offered their to the study, human beings have never been easy to deal with especially when human behaviours are unpredictable some data and questionnaires were bounty refused by the respondents.

Financially, the researcher was wholly sponsored by the researcher. which was based on the little money saved. All those limitations, limited the validity of the findings and conclusions, the research would have been more retained without these constraints.

1.9 Definition Of Terms

The following operations terms are defined in this chapter to help achieve what is needed

  1. Management accounting.
  2. Decision making.
  3. Business.
  4. Budgeting.
  5. Management industries.
  6. Planning.
  7. Controlling.
  8. Efficiency.
  9. Solvency.
  10. Information.

Management accounting:

This is concerned with the provision and interpretation of information required by management all level.

Decision making:

This is described as purposeful choosing from a number of alternative course of action.


This involves the carrying on of a business trade or commerce involving the use of find or capital.


This is a process by estimating anticipated inflows and outflows for a given period and a method of balancing both.

Manufacturing industries:

This are firms that produce goods or things in large qualities either mechanically or manually.


This is a process of ensuring that the causes of action are maintained and that desired ends are achieved.


This is a process of collecting information and making decision to achieve some objectives it determining planning its highest level, providing the overall framework for the attainment of organization’s objective. Further operational planning is carried out, primarily concerned with the acquisition of resources necessary to carry out this strategic plan.


This refers to how firms effectively utilizes assets involving inventories, sales and profit.


This refers to the ability to discharge ones liabilities as they fall due.


This refers to data that has been processed to produce meaningful relation to a field.

Chapter Five

5.0 Summary, Conclusion And Recommendation

5.1 Introduction

This research is geared towards ascertaining whether manufacturing industries do keep appropriate books of account, have qualified accounting personnel and account departments in their establishment, make use of management accounting information in making sound decision in their organization.

Finally, to see if management reports in their organization for decision is prepared regularly and on time.

5.2 Summary

The method adopted for the investigation was through the use of questionnaires and direct interview of managers and accountants. They believe that management does not make adequate use of management information for decision making was proved wrong. The research revealed that the cost accountant do provide all accounting information need and this at times affect the quantity of data to be processed.

Also the research revealed that managers apply these information effective in making decision for the business. The effectiveness was supported by fact received from managers and accountants on how its application has affected the company positively. It was also inferred from the various ways the company measured the effectiveness of the application of management accounting information that are adequately used for decision-making.

5.3 Conclusion

After due consideration of the analyzed data, the researcher was able to conclude the following:

  1. Most of the manufacturing industries do not keep proper books of account in their establishment.
  2. Management accounting role in decision effectiveness of the organization.
  3. Both managers and accountants makes effective decisions in the organization.
  4. Management accounting has played vital role to sectors like planning and evaluating in the organization.
  5. Most accounting information in industries is really favorable and obtainable.
  6. Lack of managerial expertise and unqualified establishing management accountant for decision making organization.

5.4 Recommendations

The following recommendations are made on the basis of the research findings.

Information can only be useful and effective if it is relevant and timely. The management however enjoys cost reduction by getting reports processed annually. There are some inherent disadvantages, for example, information are not available as urgently as possible. The management should therefore try to install more computer system which will help to quicken the job of the management accounting.

Also, the installation of computers eliminates error and mistakes, which are common with manual operations delay in making decision because of lack of information prepared at the appropriate time be eliminated.

Management should endeavor to employ qualified accountants. Although, the organization has qualified accountants they are not enough to make the job easier and quicker for them. A situation where few accountants have a lot of work to do will lead to mistakes, thereby providing inadequate information to the decision maker.

Apart from employing qualified accountants to handle the processing of management accounting should conduct in service training for them from time to time. This will go a long way in helping the cost accountant in supplying accurate information for management use.

Management accountant should be made to interpret every bit of information supplied to management, this will save the management the trouble of going to the accountant to have a critical review of the information need cost accountant only managers should base this on the particular problem. This is because different problems demand different accounting information for decision to be made on them.

Finally, further research is recommended into the relationship between the financial and account information and their application to business decision making.

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