Private enterprises are necessary in the economic development of any country it development or developing country. In developing country like Nigeria the roles attached are much. They put development and other socio-economic activities on the wheel. They provide other services that are peculiar to its development especially now that the establishment of industries and other socio-economic infrastructure are over politicized.
Challenged by government social and development neglect of Uboma, but surrred up by economic desires Nwoku Pam paper Mill Limited, like many other privately owned enterprise was established for the following purposes.
The need for quick economic through industrialization to remove or reduce economic stagnation and raise the living standards of the Nigeria population.
- To carry Industrialization to rural area neglected by the government.
- To promote employment to school graduate in moral areas and check the exodus into urban area.
- To compliment government industrial efforts
- To consequently and subsequently provide socio-economic infrastructures like electricity (power) water motorable roads to the rural areas.
Disappointedly, most of those privately owned enterprise disappeared shortly from the book of life after they are established without achieving their set goals.
Today, the incessant occurrence of these industries delegates have become an issue of worries to people, ridicule to government, researchers/ academicians and industrialist as well. The problems become most regrettable when reflect on how hard and time it takes accumulate.
The money for such investment through short period of time it takes such investment to collapse. To most cases, such industrial failures are attributes to bad accounting system and many or non-application of accounting concept and convention. Today this has become industrial cankerworm eating deep into business in Nigeria.
1.1 Statement Of The Problem
That they help poor returns on investments and consequently, constant factory shut-down which is a functions of poor management and bad accounting system. It is common accounting practices, concepts and conventions. Mostly private owned enterprise are characteristics with the following:
- Inadequate financial planning and implementation of recommended facts.
- Employment of unqualified or non-professionals and as a result accounting books kept are incomplete and inadequate to aid management in formulating policies and making decisions.
- Inadequate or non-installation of a good accounting system and good internal control system
- Inability t divorce ownership from management
- Lack of understanding the width of the input and the advantages of accounting.
Emphasis therefore directed in search of what is adequate control, check and balances as a tool for advertising industrial and business failures. The study therefore seeks to provide a sound accounting system hat will afford management of resources and decision making that will aid the growth of the enterprises.
1.2 Objectives Of The Study
The objectives of the study is to enable the researcher to have an insight into the role of good accounting system in the management of a private enterprises by:
- Designing adequate books of accounts and analyze the information content with a view of aiding management in decision making.
- Examine the nature and method of accounting information and management control operating in Nwoku Pam paper mills Limited, ascertain its strength and weakness and if possible make recommendations where necessary.
- Reviewing, evaluating, qualifying the extent of the application of a good accounting system in the management of private enterprises.
1.3 The Need For The Study
The establishment of the enterprises call for expanded technical and management services of which accounting is a vital one.
Consequently, there have been several literature on private enterprises. Many have effectively appraised the management and control problems of related enterprises while others dealt with the technical aspect of it.
Despite these appreciated efforts, the researcher feels that much has not been written on the accounting aspect and its effectiveness in provide enterprises. Where there is such an attempt, it has been a theoretical overview only. To help bridge the gap this study has to be carried out, as it is believed that it would such as:
- Highlight the accounting and financial control problem plaguing the enterprise.
- Install of good accounting system that would help the enterprise and private business to stand the test of time.
- Arouse further research into other financial areas of the organization.
- Suggest better financial structure necessary for optical operational and financial result of the enterprise.
1.4 Assumptions of the Study
Keeping accurate and completely comprehensive record of all transactions that will lead to the development/management of private enterprises.
The failure to keep accurate an completely comprehensive records of all transaction will lead to financial disaster for private business.
1.5 Scope of the Study
In view of the time and characteristics difficulty of obtaining data in private enterprises, a case study approach of enterprise Nwoku Pam Paper Mill Limited is made. The study would examine the accounting and financial problem of the enterprise and hence determine the necessary control measures for revenue and income reporting budgeting, systems of control and financial practices of the enterprise most of the comments, especially on the essence apply equally to non-profit and public organization.
1.6 Research Questions
In pursuance of the purpose of this study, some research questions became pertinent. These questions invariably will help to sharpen the researchers focus. These include:
- Is the company implementing the use of good accounting system?
Of what effect is the practice of good accounting system to private companies?
- How does the company (Nwaoku Pam Paper Milt Limited) Implement the accounting system?
1.7 Limitation of the Study
Willingness is a good accounting system in the management of private enterprise to disclose some vital information especially when it pertains to financial performance despite assurance of confidentiality by the researcher has reduced the depth of this study.
Time research efforts, un-coopeniting nature of the nature of the management secrecy and financial constrains made an elaborate study to care for the whole country difficulty.
1.8 Definition of Terms
For the case of understanding, some terms and concepts used should be defined, as this is not assumed by expects in the field alone, such terms and concepts include:
Accounting System: It is special concern with the design and implementation of procedures for the accumulation and reporting off financial data. This is a check and balare devised to safeguard business assets and provides for information flow that will be efficient and hopeful to the business owners.
Budget: Is a formal written statement of managements plans for the future, expressed in financial terms. A budget that is the course of further action it should contain an attainable objectives.
Capital Employed: This is the shareholders fund, loan, capital and any other long-term sources of funds.
Financial Leverage: This is the use of charge sources of funds such as debt and preference share capital along with the owners equity in the capital structures.
Net Working Capital: This is the owners equity in the business. It is the residual claim against the assets of the business after total liabilities are deducted.
Private Enterprises: This is a business organization that is wholly owned by individual person, immediately member of the family, who effectively controls them neither the government nor the public has had in the ownership and management in spite of the size.