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MORTGAGE ARRANGEMENT IN DEPRESSED ECONOMY

MORTGAGE ARRANGEMENT IN DEPRESSED ECONOMY

(A CASE STUDY OF FEDERAL MORTGAGE BANK AWKA BRANCH.

 

 

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ABSTRACT

The title of the project is MORTGAGE ARRANGEMENT IN DEPRESSED ECONOMY (A CASE STUDY OF FEDERAL MORTGAGE BANK AWKA BRANCH. The objective of the study is to find out the causes of unemployment and causes of high rates of business failure. To find out how government policies discourages the emergency of vibrant mortgage bank. To know why mortgagors default and strategies to use to recover unpaired loan.To know the causes of inflation in an economy. To offer suggestion that will help mortgage banks in creating a conducive working environment. The instrument used in data collection is secondary source which comprises textbooks, libraries professional, trade organisation, questionnaire and internet services. Consequently to this analysis a summary of finding was obtained that most of the respondents companies about rate of payment it also discover loan foreclosures and loan disbursement. In the case of the study it recommends that government should provide adequate fund and also create secondary / intermediary mortgage institution. It also recommend that central bank should review the interest rate structure and a review of payment terms.

 

 

CHAPTER ONE

1.0      INTRODUCTION

A prominent feature of real property investment is that it involves the expenditure of money. As a result, investors in real property hardly fund the project alone, instead they borrow part or all their capital requirement from financial institutions.

Leanders usually require collateral securities form their borrower before granting loan to them. This provides an avenue through which loan made to borrower could be recovered in the event of unfavourable business condition or default by the borrower

1.1      BACKGROUND OF THE STUDY

HISTORY OF MORTGAGE

Mortgage is Norman french term which originated from the various modes of operation of pledges (walmsely (P.56).

A debtor in the olden days pledges his farm land to a creditor by transferring the physical enjoyment to him, if the revenue were large enough, they repay the loan immediately but if not the money for repayment had to be raised separately.

The former arrangement was called a “phle pledge” (mortgage) while the later a “dead pledged” (mortgage) thus the word “mortgage was formed from dead pledge” mortgage which represent a situation where the proceed from a security could not repay the loan borrowed.

Resulting in a search for alternative loan through which repayment could be made.

As the practice of mortgage developed further, it becomes usual to transfer the debtors landout-right to creditor on the ground that the debtor could redeem it, if the debtor defaults the land automatically becomes the creditors own.

The principal is still effective till date and maintains that property serves as security only and should therefore be released whenever the loan is repaid.

In Nigeria today there is large-scale default in mortgage repayment due to the adverse economic circumstance. Lenders thus resort to auction their operating cost.

This practice however is usually against the intention of most financial institution in Nigeria because of harsh picture it points such an establishment in the eyes of the society.

 

1.2      STATEMENT OF PROBLEM

This research is intended to look into problems facing mortgage banks such as:

Development problems like unemployment, low production and high rate of business failure. Governmental policies and economic factors which discourages the emergency of vibrant mortgage bank.

Default by mortgagor’s in paying back the loan they borrowed from mortgage banks. Inflation in economy and high cost of construction.

Problem of uncondusive working environment for the development of mortagage bank.

1.3      OBJECTIVES OF THE STUDY

The objective of this study is to ascertain how to arrange mortagage banks in a depressed economy. Other objectives include:

(i)        To find out the causes of unemployment and causes of high rate business failure.

(ii)       To find out how government policies discourages the emergency of vibrant mortagage bank.

(iii)      To know why mortgagors defaults in paying back the loan and plot strategies to use to recover unpaid loans.

(iv)      To know the causes of inflation in an economy.

(v)       After suggestions aimed to help mortagage banks in finding a conducive working environment.

 

1.4      RESEARCH QUESTIONS

  1. i) What is unemployment and causes of unemployment?
  2. ii) How do government policies effect the emergency of vibrant mortagage bank ?

iii)        Why do mortagagor’s default?

  1. iv) What is inflation and caues of inflation
  2. v) Give suggestions on how mortagage banks can create a condusive working environmemt.

1.5      SCOPE OF THE STUDY

The scope of this study is “mortagage arrangement in depressed economy.

This researach is carried out at mortagage bank of Nigeria Plc Awka branch. This research tends to highlight the impact of arranged mortagage bank in a depressed economy and to what extent it has contributed to the effectiveness and efficient operation of mortagage bank and to the development of the economy in general as the study covers the year from 2008-2014.

1.6      SIGNIFICANCE OF THE STUDY

This research work is carried for the benefit of certain group of people who may need this work. These include housing sectors, financial institutions, researchers, students and any person who may read it.

Housing sectors:- It provides the information like procedures, requirements and implication of default to pay back loans borowed from mortagage banks.

Financial institutions:- Provides financial institutions on technology methods to use in order to enhance its profitability and create a strong relationship between the bank and their customer’s.

Researchers:- Researchers have to read this work so as to make further researches

Students::- Students who are asked to carry out a research work will find this work beneficial because it serves as a guide to carryout a good research work and also make them to acquire knowledge of the banking systems.

Any person who may read it:- Any body who read this work must achieve something from it because it provides banking and advisory services and undertakes activities concerning housing.

Finally, it will contribute to the existing literature by identifying the major barriers to the adoption of arranging mortagage banks in a depressed economy.

1.7      DEFINITION OF TERMS

MORTGAGE:            This can be described as the transfer of legal or equitable

interest in property of the borrower to lender as a security for loan with a promise for redemption.

MORTGAGES:          Is a person who lends money to another under the condition

stated above.

THE DEBT:                 In respect of which the property is created is called mortagage

dest.

MORTGAGE TRASACTION:           Is a person who borrows money with a property

known as mortagagor. It involves the acquisition of a loan with an

interest in property as security.

MORTGAGE TERM: Also empowered the mortagage to reclaim his property after

repaying his debt.

MORTGAGE TRANSFER: His real property to the mortgage to declear his

willingnessto repay a loan and also provide means by which such

loans can be directly recovered.

LEND:    It is the process of giving or granting loans or advances by banks to

their customer who wishes to or for his personal investment with his property as security.

REDEMPTION:         Is the way of returning back the loan on agreed time to the bank who gives the loan.

LENDER:        Is a person who borrowed the loan for his personal project.

MORGAGOR:           Is a person who gives a mortagagor on his property.

ECONOMIC DEPRESSION: Refers to a period of general downswning to the bussiness cycle.

 

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An EXAMINATION OF THE SOURCE AND USES OF LOCAL GOVERNMENT FUND IN NIGERIA (2000-2004) (A CASE STUDY OF EZEAGU CENTRAL LOCAL GOVERNMENT DEVELOPMENT COUNCIL).

An EXAMINATION OF THE SOURCE AND USES OF LOCAL GOVERNMENT FUND IN NIGERIA (2000-2004) (A CASE STUDY OF EZEAGU CENTRAL LOCAL GOVERNMENT DEVELOPMENT COUNCIL).

ABSTRACT

Local government is that level of government nearest to the people. It is said to be corner stone of the government system in any country.

The federal government believes that it is only through an effective local government system that the human and material resources of the nation could be mobilized for local government with its objectives is aimed at standard and stabilizing the function and financial resources at the local government level and to encourage initiatives and leadership potential.

The basic procedure of local government is revenue mobilization and its effective utilization especially more that there is no comprehensive study on sources and uses of funds in the local government.

 

The current trends of inefficiency and ineffectiveness of the local authorities should be considered with the frame work of available resources.

If the financial resources of the local of the local government are boughant and viable than this will go a long way in communicating strength and solidity to offer superstructure of government authorities.

CHAPTER ONE

  • BACK GROUND OF THE STUDY
  • STATEMENT OF PROBLEM
  • OBJECTIVE OF THE STUDY
  • RESEARCH QUESTIONS
  • STATEMENT OF HYPOTHESIS
  • SIGIFICANCE OF THE STUDY
  • DEFINITION OF TERMS

 

CHAPTER TWO

REVIEW OF RELATED LITERATURE

  • THE MEANING OF LOCAL GOVERNMENT
  • FUNCTIONS OF LOCAL GOVERNMENT
  • SOURCES OF REVENUE AVALIABLE TO LOCAL GOVERNMENT AUTHORITIES
    • EXTERNAL ATTRIBUTES OF LOCAL LGOVERNMENT FINANCE
  • THE IMPORTANCE/USES OF REVENUE GENERATED BY LOCAL GOVERNMENT
  • PROBLEMS OF LOCAL GOVRNMENT FINANCE APPROACHES OF THE IMPROVEMENT OF LOCAL GOVERNMENT FINANCE.

There are no discipline on the part of the leadership, management and staff of the local government in collecting revenue efficiently and also try to put them into effective use.

 

In the tight of the above, the researcher major objectives as regards this research work was to identity those source of finance available to local government, their uses and problem associated with their finance in Nigeria using Ezeagu central Local government development Council ad my case study.

The problem associated with sources, uses of local government finance was critically examine in this project.

In handling the above research work primary and secondary data was used. The sources of primary data was by the use of questionnaires and oral interviews, while the secondary data sources are text books.

The analysis of data was based on percentages. It is on the strength of the finding that recommendation and conclusion was made.

CHAPTER THREE

  • RESEARCH SESIGN AND METHOD ————————————
    • SOURCE OF DATA ———————————————————

3.1.1  PRIMARY DATA         ————————————————————

3.1.2  SECONDARY DATA ——————————————————–

3.2     POPULATION OF STUDY ————————————————-

3.2     INSTRUMENTATION ——————————————————-

3.4     SAMPLE SIZE —————————————————————–

3.5     VALIDITY AND RELIABILITY OF THE MEAUSRING INSRUMENT  —————————————————————–

3.6     SAMPLING TECHNIQUES

 

CHAPTER FOUR

4.0     PRESENTATION OF DATA ————————————————

41      INTERPRETATION AND ANYALYSIS OF DATA ——————-

4.2     TESTING OF HYPOTHESIS ———————————————–

 

CHAPTER FIVE

FINDINGS, RECOMMENDATION AND CONCLUSION.

 

An examination of the sources and uses of local government fund in Nigeria

(200 – 2004). A case study of Ezeagu Central Local Government Development council).

 

Proposal

Local government is that level of government nearest to the people. It is said to be the cornerstone government system in any country.

 

The basic objective underlying this study or this research work was to identify those sources of finance available to the grassroot government, their uses and problems associated with local government finance in Nigeria using Ezeagu central local government development council as my case study.

 

This research has been structural into five chapters to make for easy reading and comprehension.

 

The author, dealt with the bank ground of the research work which gives an overview of the basic procedure of local government revenue mobilization and its effective utilization.

She went further to the review of related literature the author lay hands on various Journals news paper, write various view as regard the sources and uses of local government fund in Nigeria. It also consider the current trend of inefficiency and ineffectiveness of local authorities.

 

Chapter three. Deals with research design and methodology. Primary and secondary data are used effectively.

 

Chapter four is presentation of data. The presentation interpretation, analysis of data and test of hypothesis in chapter one are done in this chapter using chi-square method.

 

Chapter five, dealt with findings, recommendation and conclusion. The authors finding is base on the hypothesis reveals that revenue available to local government authorities functions and the funds readily available to these council are also poorly managed. It is upon- this findings that the author make recommendation and draw conclusion.

 

 

 

CHAPTER ONE

INTRODUCTION

1.1     BACK GROUND OF THE STUDY

The term Local government has been defined by many scholars with different view as regards its development. W.A. Robinson (2000) states that ‘Local government’ involves the conception of territorial non-sovereign community processing the legal right and the necessary organization to regulate right of its own affairs. This I turn presupposed the control, Vis-à-vis participation in state affairs.

According to U.N. Akpan (1999), out of various possible conceptions of the local level development, two have been particularly dominants in Nigeria since the colonial time. The first was christened the indirect rule system and is infact no other than a field administration model.

Gboyega Alex (1998), state that nation wide ordinance establishing the model first in the Northern provinces and later in the southern provinces was promulgated by the colonial government in 1916, two year after the analyation of the Northern and Southern protectorates Indirect rule was actually the rule by the British colonial officials through local chiefs in terms of its philosophy and practice, the emphasis of their model was the colonial regulation of conquered people and so did not encourage popular participation and representation in the native authorities. It was therefore, strictly different from the pre colonial structure of Government which emphasis balance of power and popular participation. Indirect rule distorted these pre-colonial institutions. The model was also not human development although it led to the beginning of a net work of infrastructures of roads, schools and dispensaries, through with the collaboration of native authorities, the colonial central government and missionaries.

 

Local Government has sources of revenue of their own such as community taxes and rates, Licenses and fees, earnings and sales, Federal and state statutory allocation etc. After the Second World War, the political development between Nigeria and /Britain led to the abolition of the indirect rule system and its replacement which emphasized full grown local government which was effuient particularly and relatively autonomous. The eastern region was the fist to embark on the experiment on 1950 while the other regions followed in 1952. A few years after wards precisely in 1976, the federal military government announced the reforms of the nations local announced the reforms of the nations local government system. Essentially, the reform resuscitated the idea of participatory and autonomous government which have access to resources both internally and externally to improve the social the economic of the various communities. The question as to why there was this sudden change of direction from at the earlier emphasis on local rules through traditional rules and bureaucrat was carefully examined. The request for autonomy becomes administration particularly since 1970’s. The anticipation of the autonomy came through the 1976 reforms. Actually 1979 constitution made the anticipated a reality, thus the period between 1976 to 1979 can be defined as the period when the idea of local government in Nigeria came to include autonomy for the level of government.

However, the autonomy expectedly remained circumscribed because of control Viz; financial, administration, judiciary, auditory and even miscellaneous which the various state governments exericed in local governments exericed in local government. The most prominent control is on rinace which affects local government development.

The term “finance” encompases personal finance, business finance, business finance and public finance.

 

According to mautia joy (2001) finance was defined as the art of providing the means of payment or as a body of facts, principles and theories dealing with the raising and using of finds by individual, business, firms and the government. Our interest in this project lies in the problems of rising and using of funds by the local government will emphasis of Ezeagu Central Local government development council.

 

Thus, a Uniform system of local government through the guidelines for the local government went on to identify the executive functions of local government.

According 1999 constitution section 7 sub section 1 (b) (e) (j) (i) (vi) of Nigeria constitution states various ways the local government can source its funds, although these ways has remained grossly in adequate for maintaining capital and recurrent council. Lack of adequate finance and subvention has been of the defects responsible for the indecency.

 

Until the revenue allocation act was biplated and received in 2002 by the revenue allocation fiscal commission, at he federal government has operated a system of block grants and subventions to local government througfh state government. Since the money coming from the federal account to the joint state and Local government did not directly.

  1. Is there and financial authority of the local government?

 

1.5     STATEMENT OF HYPIOTHESIS

To guide research, the following hypothesis was formulated.

1        Ho:    The available funds are able to meet the expectations and serve

of the local government.

H1:    The available fund are not able to meet the expectations and services of the government.

 

  1. Ho: the fund available to the local government authorities are not

prudently managed.

H1:    The fund available to the local government authorities are not prudently managed.

 

  1. Ho: The Local government is under fundered partly. From the

federation account

 

H1:    The Local government is under fundered partly. From the

federation account

 

  1. Ho: There is financial autonomy of the local government.

H1:    There is no financial autonomy of local government

 

1.5     SIGNIFICANCE OF THE STUDY

The factors militating against a successful performance by the local government authorities may be dual in native. They be managerial and financial in native. They be managerial and financial in native. Finance is an important part of most organizations decision, and a clear understanding of the way in which decisions are made is essential if the role finance is to be seen in its true perspectives.

Finance is very crucial because if influences planning and achievement pf set objectives.

Local government being the level of government nearest to the people is the corner stone of the government system in any country. If the financial resources of the local goal area buoyant and viable then this will go a long way in community strength and solidarity to other super structures or government authorities.

The important of local government in the nation must be recognized. It is not a profit oriented organized. But a service oriented one and this will surely affect its revenue. To respective local governments, federal presence level of government.

It has been notice that the allocation to the local government have not been steady. The flunctuational of the statutory allocation always put the local government of their budgets estimate for any given year. In most financial year the realization on revenue is spent on recurrent expenditure for running the council while little or noting is left for capital expenditure. This accounts for the absence of development projects by various local government will be elaborated in table in chapter four.

 

 

LOCATION AND AREA

Ezeagu Central local Government Development area is one out of seventeen local government area and thirty nine development centers of Enugu state, ie the total of fifty six local government area in Enugu state. It occupies a geographical western position in the state. It is located at Mgbagbuowa and also surrounded by Ezeagu South, East and North West local Government area.

 

1.2     STATEMENT OF PROBLEMS

          The basic problem of local government includes:

  1. The problem of revenue mobilization and its effective utilization.
  2. Accountability of funds and properties of the Local government.
  3. The problem of effective displine leadership in the local government.

 

1.3         OBJECTIVES OF THE STUDY

a             To examine the problems in local government finance and establish the factors responsible for poor revenue generation and ineffective execution of the local government programs and project.

  1. To identify the problems especially as it affect finance with a view of making adequate recommendation for improvement

1.4         REASEARCH QUESTIONS

  1. Are the availability of funds able to meet the expectation and services of the local government?
  2. Are the funds available to the local government authority prudently managed?

The Significance of this study is there, to find ways of improving local government finance for effective channeling, implantation and executive of the program with in Ezeagu Central local government Council as my area of concern.

 

LIMITATION OF THE STUDY 

1.6         There are a lot of limitations that surrounded this study. The inanely fact ones was time factors, non availability of funds at the time of this research, poor response to question also bring some difficulties. Majority of the local government staff are semi-illiterates.

 

Having noticed that such people work in the Local government, measures were taken to the question simply for easy answer.

 

However, despite these limitation, there was progress in the                     research        since other necessary information was gotten.
1.7            DEFINITION OF TERMS

              Local Government/Authority: The third tier system of government after the state federal government.

 

*             Finance: – A body of fact with the raising of fund by local government authorities it encompass personal, business and public finance.

*             Local levies: – these include all the internal source of revenue collected within the local government area.

 

*             Local Government Allocation: The percentage of funds, the Local authorities gets from the national fund.

 

 

 

REFERENCES

Odoh. N. (1998)        Public finance for Polythenics

JTC Publisher Enugu P.15

 

 

Agbo .LO. (1995)      Government and politic in Nigeria

JTC Publisher Enugu P.15

 

Gboyega A. (1998)   Local Government and Political Participation                    in western states

                                  (Ph.D. Thesis), Ibadan, PP 70-78.

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THE ROLE OF ACCOUNTING IN SOCIETAL DEVELOPMENT (IN THE NIGERIAN CONTEXT)

THE ROLE OF ACCOUNTING IN SOCIETAL DEVELOPMENT

(IN THE NIGERIAN CONTEXT)

PROPOSALS

 

This research work is aimed at as certainly the importance of the recounting profession in the Societal Development (private and Public Institutions inclusive).  It also highlights some of the problems which an accountant may encounter while performing his role as a professional.

The performance of these activities by an accountant and the role he plays in societal development has made accounting the concern of the society and the entire business world.  It is sometime said that accounting is an adjust of business because it is employed to supply financial information to individual and organizations.  Accounting profession could be defined in relation to problems it addresses in the society such as taxation problems, sales statistics, urban congestion, computer technology, etc.  The accounting profession is not only for the good of the individual but also for the society in that it has managerial and social responsibilities to shoulder in the cause of serving the public.

To discuss the project in detail, the study has been divided into five chapters as follows:

  1. Chapter one deals with introduction, statement of the problem, objective, significance of the study, limitation and delimitation of the study.
  2. Chapter two deals with the review of related literature, definition of accounting, the necessity for societal development and the role of accounting in societal development.
  3. Chapter three discuses the research design which includes the area of study, types of data used and location details.
  4. Chapter four deals with the analysis of findings based on the data collected. It evaluates and discusses the findings.
  5. Chapter five deals with the findings, recommendations and conclusions made by the researcher.

CHAPTER ONE

1.0     Introduction

1.1     Objective of Study

1.2     Significance of the study

  • Statement of Problem

1.4     Hypothesis

1.5     Scope and Limitation of the study

  • Definition of Terms

 

 

CHAPTER TWO

  • Review of Related Literature
    • Definitions of Accounting
    • Historical development of Accounting
    • Purpose of Accounting
    • Users of Accounting Information
    • Presentation of Accounting Information
    • Accountings Activities and Accounting Officers
    • Probity and Accountability – a Necessity for Societal Development
    • The Role of Accounting in Societal Development

 

CHAPTER THREE

  • Research Design and Methodology
  • Research Design
  • Area of Study
  • Types of Data used
  • Location of Data
  • Method of Data collection
  • Determination sample size, population size and sample fraction.

CHAPTER FOUR

4.0     Data Presentation and Analysis

  • Presentation of Data
  • Method of Data Analysis and the Analysis itself
  • Tools for Data Analysis
  • Analysis of Data
  • Conversion of Data collected into figures
  • Test of Hypothesis
  • Statement of hypothesis one
  • Statement of Hypothesis two
  • Statement of Hypothesis three
  • Statement of Hypothesis four

 

CHAPTER FIVE

5.0     Summary, Findings, Conclusion and Recommendation

  • Summary of the Findings
  • Conclusions
  • Recommendation

References


CHAPTER ONE

 

  • INTRODUCTION

This project is aimed at looking into the accounting profession in details and examining its role in societal development.

A study of the evolution of accounting suggests that accounting processes are reactive because they have developed primarily in response to business needs.  Also the development of accounting process has been related to economic progress and societal development of a country.

History shows that the higher the level of Civilization or development, this more elaborate and wider the accounting method becomes.

Since Picoli’s days to this present day, accounting has recorded a lot of tremendous changes and growth all over the universe. For instance during the first sixty years of the twentieth century, a major economic and societal force had thrown the accounting profession into new frontiers and responsibilities.  The factors contributing to this growth are the increase in the population of large corporate business in the affairs of business by way of taxation and business regulations, technological advancement especially in the area of computerization – which has rapidly changed the process of data procession.  These factors, to a great extent, have deeply contributed tot he development of the accounting profession over the years.

The role of computer in the accounting profession has facilitated the traditional functions such as payroll, cost accounting and general bookkeeping.

It is also being used for analytical purposes such as forecasting,     cost benefit, analysis, etc.

As professionals, accountants are expected to demonstrate a responsibility tot he public services above their commitment to personal economic gains.  Accountants recognize that the special esteem.  They enjoy obligates them to work for the improvement of society. Complimenting their obligation to society, accountants have analytical and evaluative skills needed in the solution of the over-growing problems of the universe.  The special abilities of accountants as well as their independence and ethical standards, permit them to make significant and unique contribution in such areas as protecting the public interest, preserving environment interest and controlling and improving public programmes.

In recent times, the work of accountants increased in scope.

The reward as added to the accounting profession include installation of accounting system, auditing and investigation management of social activities and host of others.

It is also of importance to note that the increase in the scope of accounting give rise to complex problems, which accountants must encounter.  This is why competent accountants are needed in the various areas (i.e. to ease the accounting problems facing the management of companies and the society in general).

Apart from providing accounting information, the accountant also gives his opinion on a wide range of representations such as sales statistics, lease agreement, etc. or the fact that, accounting is not only for the good of the individual accountants have to be conscious of the society’s benefit.  This is because social responsibility and service tot he public is the major objective of the accounting profession.

Thus, there is the need for the accountants to develop a social attitude towards their profession.  Recall that the accountant is duty bound to exercise his duties with reasonable care, skill and diligence.  He must offer his integrity and reputation to the public, which relies on his judgment and pinion.

 

  • OBJECTIVE OF STUDY

In view of the purpose of accounting and how it affects the society generally, this study is designed to achieve the following objectives.

  1. Identify the users of accounting information
  2. Highlight the importance of accounting information to its various users
  • Highlight the role played by accountants toward providing accounting information to its users
  1. The contributions of the accounting information towards societal development

 

  • SIGNIFICANCE OF STUDY

It is hoped that this study when completed will

  1. Be able educate the management of firms on how important it is to tailor their accounting information requirement in such a way that they can take decisions which will help maximum the objective(s) of the business;
  2. Be able to educate shareholders (prospective ones inclusive) on how to watch out for profitable and viable firms in which to invest their capital;
  • Provide prospective employees with information that will enable them look out for companies that can offer them safe employment through growth over the period of time;
  1. Equip trade uncoils with methods of calculating the claims for higher wages and better conditions for labour
  2. provide creditors with the acid test with which to know if a prospective debtor can keep can keep to the terms of credit;
  3. assist the government and its agents on effective revenue generation and allocation;
  • help consumers to use accounting data to asses the viability of a company (with respect to long term contracts);
  • sensitizes competitors towards using accounting information for purposes of companies;
  1. Bring accountants to remembrance in respect to their roles in societal development.

 

  • STATEMENT OF PROBLEM

The accountancy profession is faced with ‘teething’ problems, some of which include:

  1. Professional Abuse and Indiscipline: This is where an accountant (for instance) fails to keep to the ethics of the accounting profession. The accountant here forgets that the owes a fiduciary responsibility to his clients and the public in general.  Cases of this comes up where accountants encourage their clients to void paying the tax they should be intentionally declaring a huge operating loss for tax purposes where the client actually made profit during the basis period of assessment.  This false declaration does not only obtain for tax purposes.  You also see it where in a bid to help their client obtain loans from financial institutions, accountants falsely declare very high profits in order to enhance their client’s opportunity of obtaining loan.
  2. Imposition by Management and Top Government Officials: Offer times, accountants are reduced to the level of terms paper tigers. They can only bank but cannot bite.  They are threatened by these officials.  Failure to keep to such an injunction may lead tot he disengage of the accountant’s duties (or even death). As a result, accountants keep closed eyes on such situations.
  • Inadequate Internal Control System: Failure to install and implement an adequate internal control system hampers effective auditing.  This is because there are no proper checks and balances established to curb the excesses of the management and staff of an organization.
  1. Inadequate Method of Data Processing: Nigeria is still faced with the problem of the manual system of recording and processing financial data into usable information. This system, as we know is very tedious and prone to error(s).

The computer; till data, is still out of the reach of may organization (especially the small scale business) due to its exorbitant each outlay. If this were to be made available to interested buyers at subsisted amounts, the headache associated with the manual system of operation will be reduced to the barest minimum.

  1. The Institute of Chartered Accountant of Nigeria (ICAN): This body is among the problems to reckon with so long as the accounting profession is concerned. Many a time, graduate accountants are denied jobs because they do not have a certificate to show that they are members of this body.  In recent times, it row seems as if it would be easier for a camel to pass the ICAN Exams.  As a matter of fact, persons who though chartered in some other country but somehow finds themselves here in Nigeria, are not recognized as professional accountants until they charter with the ICAN.

These are the problems (among many others) that the researcher can mention. These and other similar problems cannot be solved without a research of this kind.  Hence in study, the researcher would advance solution to the problems and t the same time make very useful recommendations that will both alleviate these problems and enhance the prospects of the role of accounting in the development of the Nigerian society.

 

  • HYPOTHESIS FORMULATION

With regard to the problems identified above as well as the objective of the study, the researcher has these propositions to make:

HYPOTHESIS ONE

Ho:    Accounting information is not important to its users.

Hi:     Accounting information is important to its users

          HYPOTHESIS TWO

Ho:    Nigerian accountants have not been participating in social     development.

Hi:     Nigerian accountants have been participating in societal        development.

HYPOTHESIS THREE

Ho:    Accounting information is insignificant to societal                           development.

Hi:     Accounting information is significant to societal                              development.

          HYPOTHESIS FOUR

Ho:    Adequate internal control system is not necessary in the        provision of accounting information.

Hi:     Adequate internal control system is necessary for reliable      accounting information.

 

  • SCOPE AND LIMITATION OF THE STUDY

The study will cover the externalist trade of accounting, the purpose of accounting, the users of accounting information, the problems facing accountants in the present day Nigeria and the role of accounting in societal development (in Nigeria).

This researcher work was constrained by academic workload, inadequate finance, time and other ancillary problems.  The data required for this work was not easy to get because the respondents, though co-operative, were not always available when their assistance was needed.

Nevertheless, it is hoped that the study will represent the role played by the accounting profession in societal development.  The conclusive drawn from the researcher is hoped to be of empirical relevance to the people of Nigeria.

 

  • DEFINITION OF TERMS

BANK DISTRESS:

This is a state of being in difficulty by a bank as a result of lack of money.

BUDGET

A plan expressed in financial terms, which covers a period, usually one year and contains the income and expenditure of an organization within the period as well as policy to be pursued during the period for the attainment of the set standard.

CLIENT:

A company or individual to which an accountant owes a profession duty to render special service which is under a contract term for a period.

COMPUTER:

An electronic data processing device used to facilitate data   processing and its storage for use when needed.

INTERNAL CONTROL:

The whole system of control, financial and otherwise, established by management to carry on the business of the enterprise, in an efficient and orderly manner, to ensure adherence to management policies, safeguard the asset and secure as far as possible the completeness and accuracy of the records.

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CASH BUDGETING AS A BASIS FOR DECISION MAKING. (A CASE STUDY OF AGUATA LOCAL GOVERNMENT AREA).

CASH BUDGETING AS A BASIS FOR DECISION MAKING.

(A CASE STUDY OF AGUATA LOCAL GOVERNMENT AREA).

ABSTRACT

 

The research project was on cash budgeting as a basis for decision making (A case study of Aguata Local Government Area).

The whole work has been divided into five chapters.

Chapter one, Introduces the project

Chapter two, talks on literature review

Chapter three takes care of the methodology

Chapter four is about data analysis and

Chapter five is about summary, conclusion and recommendation.

In carrying out this project the researcher applied two pronged approaches to sounding of data.

The two approaches were the primary and secondary source of data collection.

In case of the primary approach researcher developed a list of questionnaire which she distributed to respondents.  The second data collection utilized library research, textbooks, journals and unpublished lecturers.  The questionnaire is attached as an appendix on the end of the work.

The data were analysed in form of hypothesis by using chi-square form of analysis the researcher found out that some project were started and abandoned half way while some other establishments adhere strictly to their cash budgets.

In her conclusion, the researcher said that cash budgeting is an important management tool both in public and private sectors.

Finally, the researcher recommended that orientations programme should be organised for new staff, that modern accounting equipments should be bought and put in use, that monthly cash budget should be introduced to take care of fluctuations in the economy and that management should install effective financial rewards as motivation towards meeting the organisations budget objectives.

PROPOSALS

 

In management audit they attempted to aid the management of the organisation by providing it with information and analysis useful in the process of control.

Management audit can also be significant in financial accounting area.

For many year now, stockholders, potential investors and other interested parties have been concerned with the annual reports of major co-operations and the attached letter from the president of the corporation.

Accountants have been attempting to deal with this problem for some years now and many proposals have been presented to which management audit is the one that I think that has the greatest potential for the future.  For both internal and external reporting purposes.

Who are capable for appraising performance both for accounting data and management analysis.  If this appraisal were made and an opinion rendered, the management audit would be of significant benefit to internal and external parties alike.

The purpose of the audit is being the attestation of management’s representations of an independent examiner.  By attestation I refer tot he reliability of management statements regarding its own decisions as proven by an independent third party.

The auditor’s financial statement examines the performance of the company accountable tot he stockholders for its decision.

Also management audit is a way of evaluating the performance of management in regard tot he decisions made, the efficiency of its operating and the attainment of corporate goals.

To this date, there has been little empirical research to determine the potential value of the management audit to users of the willingness of management audit process.

However, the management audit concepts it carefully designed could prove to be a most important development in the management appraisal field.  With a view to improving management efficiency.

This research is intended to investigate the extend to which management auditing is applied by organization in Nigeria.

For example it is utilized by organisation as a tool of improving management efficiency made.

This research involves, library work, periodicals and consulted published professional journals.

CHAPTER ONE

1.1     Introduction`

1.2     Statement of problem

1.3     Purpose of study

  • Significance of study
  • Scope and limitation
  • Formation of hypothesis
  • Definition of terms

Brief history of aguata local government area

Reference

 

CHAPTER TWO

  • Review of related literature
  • Budgeting as a decision-making tool
  • Benefits/advantages of cash budgeting
  • Preparation of cash budget
  • Functions of the budget committee
  • Stages of cash budget preparation
  • Guideline for cash budget preparation
  • Objective of cash budgeting
  • Essential of budgeting

Reference

 

 

 

CHAPTER THREE

  • Research design
  • Sample size
  • Method of data collection
  • Method of data analysis tool
  • Decision rule chi-square

Reference

 

CHAPTER FOUR

4.1     PRESENTATION AND ANALYSIS OF DATA

 

CHAPTER FIVE

  • Summary
  • Finding
  • Recommendation
  • Conclusion

Bibliography

Questionnaire

 

 


CHAPTER ONE

 

  • INTRODUCTION

“For which of you desiring to build a tower does not first      sit and account the cost whether he has enough to complete it” (Lk. 14:28).

Every rational economic unit has some objectives to attain. Individuals, corporate bodies or governments have     objectives to achieve.  To achieve their respective objectives,           resources have to be made available.  Unfortunately nature did       not distribute her resources abundantly, whilst objectives and        needs are numerous and varied as there are various economic           units.  But the means (that is resources) to satisfy those needs        are very scarce.  Thus one has to utilize his available resources   effectively in order to realise what one want.  To maximize the    objective of an economic unit requires that one has to plan.

Planning, therefore is the process of determining the future    course of action in order to attain a desired objective or a set      goal.  A business enterprise may have as its objective the           erection of an addition factory in say, seven years time.  It     therefore draws up a plan to accomplish the task it has set for itself.

Because finance is scarce, thus each year the enterprise has to plan towards the building of the factory.  This yearly explain is         known as budgeting – a subset of corporate plan.

To a lay man, budget is just an estimate of how to spend money.  To the government budget is an estimate of a plan of     how resources are going to be supplied and utilized stated a quantitative and monetary terms within a specified period.

To accountant therefore budget is a quantitative statement    in financial terms, prepared for a specific period, it may be one       year for the realization of enterprise set goals.  It is thus a very    important decision-making instrument.

A budget is defined as a financial or quantitative statement,   prepared and approved prior to a defined period of time, of the      policy to be pursued for the purpose of attaining a given objective.

(A budget is the conversion usually by segments and on short range basis of plan into figures, an accounting as it were for the future).

A comprehensive budget is made up of functional or sub-      budgets.  Some of them are, sales budget, production budget,      material purchase budget, factory cost budget, selling and administrative budgets, capital expenditure budget etc.

All these functional budget are summarized and compressed in       one budget called the MATER BUDGET.

This is defined as a total debuget in which are packaged in    one statement the sale; expenses on production, capital         movement on land, equipment and cash budgets of an organization.

 

CASH BUDGET

Since cash is the most active financial account in a business, the key in preparing a financial budget is therefore, a forecast of cash flows leading to a cash budget.  A cash budget is one of the most important budgets prepared in an organisation.  It shows in summary form, the expected cash receipt and expected cash payment during the budget period, liquidity and cash flow management are key successful operations of any organisation and it is with good reason that cash budget should receive close attention from accountants and managers.  A cash budget is defined as the planed cash position by interim period for a specific time span” it consists of two parts.

  1. The planned cash receipt (inflows)
  2. Planed cash disbursements (outflows)

It is concerned with ways to speed up the inflow of cash, ways to delay outflow of cash, sources of cash and temporary uses of excess cash2

Cash budget shows the effect of the budget activities selling, buying, paying wages, investing in capital equipment and so on, on the cash flow of an organisation, it is a continuous activity with budgets being rolled forwards as time progress3.

Cash budget are prepared in order to ensure that there will be just sufficient cash in hand to cope adequately with budgeted activities.  The cash budget may show that there is likely to be a deficiency of cash in some future period in which cash over draft or loans will have to be arranged or activities curtailed or alternately the budget may show that there is likely to be cash surplus in which case appropriate investment or use for the surplus can be planned rather than merely leaving the cash idle in current account.

 

  • STATEMENT OF PROBLEM

Budget is one of the controlling instrument by Management.

It is a plan or estimate to be attained by an enterprise.  The problem is why budget goals in some cases failed to be realised.  It is because of insufficient capital.  There are numerous needs but resources to satisfy these need are very scarce.  It is with the view to find solution to these problems that the researcher has undertaken this study with Aguata Local Government Area as a cash study.

 

  • PURPOSE OF STUDY

This study is embark upon in order to assist organizations and other interested groups who use cash budget in decision makings.  Infact the objectives of this research are: To inform an organisation of its cash position at any point in time.  To explain how situational variable could effect budget goals and to point out budget limitations.

  • SIGNIFICANCE OF STUDY

The significance of the cash budgeting are:

  1. Cash budgeting instills in executive as well as their sub-ordinates the habit of basing decision on investigations studies and research.
  2. It provides the yard stick for control of operations is a business firm or any organisation.
  3. It makes possible the control over operation, revenue and cost.

 

  • SCOPE AND LIMITAITON

In carrying out this work the researcher encounter some constraints.

 

  1. Money: A huge amount of money was needed in printing out the questionnaires and equally large amount of money was needed in shuttling between one office and the other in distributing the questionnaires and in collecting them back.

 

  1. Time: The time allotted for the research work was not enough as to enable the research give an in-depth treatment to is.

 

  1. Low Response by the respondents: Some of the respondents would tell you to come and collect the questionnaire in about two days time, only to be met with their absence on the day appointed.

Then to reduce this constraints made the researcher to

chose Aguata Local Government Area which is nearness as a scope of study.

 

  • FORMATION OF HYPOTHESIS

Based on the statement of the problem the following

hypothesis has been formulated.

 

  1. Ho: my organization has been operating a system of cash budgeting.

HA:   My organisation has not been operating a system of cash budgeting.

 

  1. HO: Operating of cash budgeting in my organisation has been continuous

HA:   Operating of cash budgeting in my organisation has not been continuos.

 

  1. HO: If my organisation experiences any cash budget surplus, it invests it to field income

HA:   If any organisation experiences any cash budget surplus, it does not invest.

 

  • DEFINITION OF TERMS

 

CASH:                 Money inform of coins and notes rather

than cheques.

 

BUDGET:            A financial summary of estimated income and expense of a government, business or household for a given period of time, usually one year.

CASHFLOW:       The flowing of money into a business (as income and out of business wages materials).

 

MANAGEMENT:         The body of these in positions of

administrative authority.

CREDITORS:      Persons, group of organisation to when money is owned.

 

DEBTORS: Person, group or organisation that owns money.

 

SURPLUS: Amount left over after one has used all that one needs amount by which money received is greater than money spent.

 

DECIFIT:             Amount by which something especially sum of  money is too small.

 

 

 

          BRIEF HISTORY OF AGUATA LOCAL GOVERNMENT       AREA

Aguata Local Government Area was one of the oldest Local Governments in the Eastern Nigeria.  It was created by then colonial master through the indirect rule system.  The came and sought for a land to build and administrative centre to facilitate easy administration and bring their government nearer tot he people that was the year 1918.  A renounced traditional rules and prominent warrant Chief Ezeabasili (Gbulie Aku 1 of Isuofia) showed them a virgin land that is now the headquarter of Aguata Local Government Area to build according to him their temporal office which thought would be temporal.  The district officer (D.O) as he was called then accepted the offer with good faith and started the building.

The district officer was told that the name should be named Aguata meaning land of grasses.  With advent of fine the site had undergone many changes.  Now the headquarters is now an attraction centre with many magnificent buildings here and there.

By then the towns that made up the local government were forty-five (45) in number.  After the independence many of them agitated to carve out their own local government out of their mother local government.

The people of Orumba was granted an autonomy in 1988 by then government of Col. Nnaemeka Akonobi.  Again it was spitted into Orumba North and Orumba South in 1990.

Presently the Aguata Local Government Area is made up of  fourteen (14) town namely:

Achina, Aguluezechukwu, Akpo, Amesi, Ekwuluobia, Ezinifite, Igbougwu, Ikenga, Iusofia, Nkgologwu, Oraeri, Uga, Umuona, Umuchu..  Almost all these communities have one or more secondary school many commercial schools (both approved and inspected, but yet to be approved, are more than 100 primary schools and nursery school.

The Local Government area is bounded in the nest by Anaocha Local Government Area and in the Eastern part by Orumba North Local Government Area.  in its Northern part Anaocha Local Government area on the boundary.  While Ideato Local Government of Imo State is on its southern part.

The Local Government Area is made up of department namely, health and agricultural department and finance department.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REFERENCE

Buter C. I.                      Principles of cost accountancy

Cassell limited, London,

4th Edition 1973 pg. 467

 

Howard B. B                 Introduction to Business Finance

And Uption M.              Mc. Grawhill Book Company

Incorporated American

1st Edition, 1953,pg. 169

 

Monwuba A. O              Principles and practice of cost accounting Publisher – Enugu Nigeria

1st Edition, 1995 pg. 150

 

Enclychlopedia:             Americana Enclyclopedia Vol. 5

new standard Enclyclopedia Vol. 3 pg. 484.

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THE NATURE AND CONSEQUENCES OF JUVENILE DELINQUENCY IN NIGERIA: A STUDY OF ENUGU NORTH LGA, ENUGU STATE

MAKE YOUR PAYMENT  INTO ANY OF THE FOLLOWING BANKS:
 GTBANK
Account Name : Host Link Global Services Ltd
ACCOUNT NUMBER: 0138924237
First Bank:
Account Name: Chi E-Concept Int’l
Account Name: 3059320631

Foreign Transaction For Dollars Payment :
Bank Name: GTBank
Branch Location: Enugu State,Nigeria.
Account Name: Chi E-Concept Int’l
 Account Number:  0117780667. 
Swift Code: GTBINGLA 
Dollar conversion rate for Naira is 175 per dollar. 

ATM CARD:  YOU CAN ALSO MAKE PAYMENT USING YOUR ATM CARD OR ONLINE TRANSFER. PLEASE CONTACT YOUR BANK SECURITY FOR GUIDE ON HOW TO TRANSFER MONEY TO OTHER BANKS USING YOUR ATM CARD. ATM CARD OR ONLINE BANK TRANSFER IS FASTER FOR QUICK DELIVERY TO YOUR EMAIL . OUR MARKETER WILL RESPOND TO YOU ANY TIME OF THE DAY. WE SUPPORT CBN CASHLESS SOCIETY. 

OR
PAY ONLINE USING YOUR ATM CARD. IT IS SECURED AND RELIABLE.

Enter Amount

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PROBLEMS OF BANKING SYSTEM IN NIGERIA (A CASE STUDY OF CO-OPERATIVE AND COMMERCE BANK OF NIGERIA)

PROBLEMS OF BANKING SYSTEM IN NIGERIA

(A CASE STUDY OF CO-OPERATIVE AND COMMERCE BANK OF NIGERIA)

CHAPTER ONE

  • Introduction 1

1.1     background of the study                                                          6

  • Statement of the problem 9
  • Purpose of the study 10
  • Significance of the study 11
  • Limitation of the study 12
  • Statement of hypothesis 12
  • Definition of terms 13

CHAPTER TWO

  • Literature review 16

2.1     Definition of a bank                                                       16

  • History of co-operative and commerce banks 20
  • Types of banks and their functions 23
  • The role of banks in the national economy. 25
  • Types of problems facing commercial

banking industry in nigeria                                            29

  • Competition in banking 46
  • Organizational problem 49
  • Causes of bank failure 50

CHAPTER THREE

  • Research design and methodology 53

3.1     sources of data                                                               53

  • Location of data 58
  • Sample of data 59
  • Method of investigation 60

CHAPTER FOUR

  • Data presentation and analysis 61

4.1     tabulation of frequency result                                        61

  • Test of hypothesis 67
  • Analysis of data 71
  • Interpretation of data 74

CHAPTER FIVE         

  • Summary of findings, conclusions and recommendation 76

5.1     Discussion of findings                                                   76

  • Recommendation 88
  • Conclusion 90

Bibliography.                                                                 94

 


CHAPTER ONE

  • INTRODUCTION

Banking business started as far back as the  seventeenth century.  When the receipts issued by Goldsmiths to depositors were used as a means of exchange in commercial transactions.  Because these receipts were accepted generally, they become transferable too.

A back is an institution where money and valuable are kept for safety purposes.  Banks also lead money known as loan, pay out money an the customer’s order by means of a cheque and bandraft and also give overdraft to customers.

 

The structure of banks can be grouped into the following namely:

  1. CENTRAL BANK: This is the opex institution in the financial system of any country.  It is charged with the responsibility of managing the monetary polices of the government.  This was established in March 1958 and started full operations by 1st July, 1959.  Which was after many banks like the West African Currency Board (WACB) in 1912, and the International Bank for Reconstruction and Development (IBRD) in 1955 failed to perform their objectives, and they later folded up.

 

  1. COMMERCIAL BANK: This was started in Nigeria in 1892 with the establishment of African Banking Corporation and foded up in 18 93, then British Bank of west Africa [BBWA] was established in 1893. started operation in 1894 and later folded up too. May other bank come into existence which equally up. This is classified into three main groups which are as follows.

(a)     INDIGENOUS BANK: these are bank fully owned and controlled by Nigerian citizen including government. The first indigenous  bank in Nigeria was the national bank of  Nigeria (NBN), which started operations in 1933 followed by African Continental Bank Ltd (ACB) in 1947.

 

(b)     MIXED BANKS:  These are banks jointly owned and controlled by foreigners and Nigeria citizens including governments.

 

(c)      FORIGN BANKS (XPATRIATE BANKS):  These are banks fully owned and controlled by the foreigners.

 

The Nigeria Indeginization Act of 1972 Convert Most of these foreign banks which was Ider phased out ling time ago.  However, the 1995 budget has reintroduced the foreign (expatriate) trade in which banking system is an integral part of it.

 

  1. MARCHANT BANK: This is a bank that specializes in providing financial services to commercial firms and industries.  This was established in 1964. this was established to assist large corporation , government, investor and individual in their financial  and management problems.

 

4        DEVELOPMENT BANK:  This is a bank sep up to handle special development projects in the country.  Also it help entrepreneurs by providing loans and consulting services to them, this is classified into the following groups namely:

  • NIGERIA INDUSTRIAL DEVELOPMENT BANK (NIDB): This was established in 1964 to replace the investment corporation of Nigeria.  This assists the public and private sector companies.
  • NIGERIA BANK FOR COMMERCE AND INDUSTRY (NBCI): This was established in 1973 to see to the financial implementation of the Enterprises promotions Decree of 1972.  this assist the indigenous businessmen.
  • NIGERIA AGRICULTURAL AND CO-OPERATIVE BANK (NACB): this was established in 1973 with a capital of twelve million naira (N12 million) and is fully owned by the federal Government. This assists the agricultural sectors individual farmers and co-operative bodies.
  • FEDERAL MORTGAGE BANK (FMB): This is a bank established by the government to help people build house by giving them ling term loans. The customers payback what they own the bank by mortgaging the land and house till they finished what they are owing.

 

  1. SPECIALISED BANK: This is another type of bank which was established by the government and it includes the following namely:
  • PEOPLES BANK OF NIGERIA: This is set up by Nigerian government in 1989 to help petty traders.  They also provide loans in groups at no interest rate, but an administrative cost of fifteen percent (15%) of the loan.
  • COMMUNITY BANK: This was established in 1990, for rural development.  It was credited to bring the banks closer to the community to assist people in their business transactions and daily running.

 

Banking system is the system at which banks operates.  This is divided into four groups namely:

  • UNIT BANKING: This is a type of banking system where the banks involved operate without branches.  This is commonly found where commercial banks exists.
  • BRANCH BANKING: This system relates to a situation where there are few banks with a large number of branches.  This is then telling the readers that the banks seen here operate with branches.
  • GROUP BANKING: This is a situation where three or more independent banks are brought together under one control through the exercise of majority share/stock ownership.

Despite the creation of all these banks by the government to aid entrepreneurship development.  The Nigerian banking system banking system still encounter a lot of problems which has disrupted its operation in the country.  This project will look at most of these problems and their causes and also provide possible solutions to avoiding these problems in the development of banking system.

 

  • BACKGROUND OF THE STUDY

Commercial Banks as financial Institutions were established to cater for the savings and credit needs of small scale producers.  Commercial banks are the pioneering institutions in the art of banking followed by other banks.  The art of banking and industrial financial needs developed gradually and involved a lot of learning and perfection.  The early businessmen who were involved in this art learning and perfection were extra careful in management either because they could not accurately fore cost very well into the future or the risk involved in such find management was such that they could not by the use of the tools and techniques available to them totally avoid, or reduce to a manageable level .  pioneers of banking business realized early in life from the more unpredictable and the grate.  The risk involved in lending.

Moreover, for the fact that they could not predict the time their depositors will come for their money, they always keep their money handy-lending short.  This marching principle and the confidence of utmost good faith which characterized early banking practice was the hinge on which commercial banking successfully started.

As the economy grew, the need to hoslen growth of a particular segment of the economy may arise.  This may be through different finding to boost development in that sector, a priority which under normal circumstances, the existing financial arrangement could not after.  So the need to establish financial institutions, designed to act as catalyst, to provide the needed fund to galvanize the development of the less privileged sub-sector for the economy into action and to grow along with other sub-sectors of the economy.  In Nigeria, this need to provide and package special type of financing to some less privileged sub-sectors of the economy gave rise to the establishment of the people’s Bank, New Nigeria Bank etc.

In a barker economy, there was no financial needs as economic and social needs were met by a mere exchange of goods and services.  However, with growth and development, there arose financial needs of which commercial Banks adequately took care of but not for long.  With time the gap started again of which the existing commercial Banks could not fill.

It is quite unfortunate that some commercial banks not quite long after establishment will start experiencing multi – purpose problems.  Most of these institutions have ill-defined objectives-objective so broad that usually the institutions do not have the means nor the experience and capabilities to achieve them.  Further more political interference affects development institution.  Most of these institutions are mostly government owned banks and are prone to politics and government, interferences.  It becoming a norm that instead of appointing experienced and qualified persons as Board members of these institutions to make expert policies, political consideration favouritism takes upper hand with the result that Board members will not be contributing their best.  Also government direct or indirect interferences in the lending policies of these institutions, have not helped matters.  Lack of qualified and experienced staff to man, these institutions did not help matters, with the result that decision and results were not what are expected to be.  It is on this background that the research is carried on for effective check and control.

 

  • STATEMENT OF THE PROBLEM

The problem in a nutshell includes such practices as fraudulent activities and mismanagement  by bank officials, poor liquidity and unavailability of adequate credits to deserving customers.

The phenomenon, technically referred to as “Bank distress” has become a regular feature in the Nigeria banking industry.  It connotes the erosion in the capital base of the enterprises which is commonly faceable to indigenous banks.  These banks as mentioned were set up by Nigerians with sloe objective of meeting the business needs of fellow Nigerians.  For instance the National Bank, when established in 1933, work towards catering for the interest of Nigerians.  The African continental Bank (ACB) was established in 1947, which aimed at assisting indigenous companies and individuals who were victims of the discriminating practices of foreign banks.  These banks have achieved a lot in the country since their inception irrespective of very serious set backs caused by unco-operative altitudes of bank debtors and hard regulatory policies as well as unpatriotic attitudes of the citizens.

 

  • PURPOSE OF THE STUDY

The purpose of this project is to identify and provide possible solutions to the problems in the Nigerian banking industry.  So having identified the problems to which this study address itself, the researchers shall in this work, make a critical insight into the problems of banking system in Nigeria (case study of co-operate and commerce bank Plc Enugu) and determine the effects and reactions of the situations in the following:

  1. The profitability of the bank.
  2. Their reaction to the various policies of the government through central Bank of Nigeria and Nigerian Deposit Insurance corporation to correct their irregularities.
  • The overall impact of these two situations on the bank existence and to their customers.

 

  • SIGNIFICANCE OF THE STUDY:

It is of importance for banks and business organization to know the cause of the problems in the banking industry and the possible ways to solve them.

It will also and most banks and business organization to realize the need to encourage the growth in Nigerian banking industry that our banks should not be allowed to die having lived to their responsibilities.

The project will also make Nigeria realize the need for honesty, hard work and patriotism so as to encourage and inculcate banking habits not only to the mosses but also to the rural dwellers.  Also its project will serve as material for future research, economist and the economy of the country.

  • DELIMITATION, SCOPE AND LIMITATION OF THE STUDY

The problems of Nigeria banking system is a very broad topic, but its project will concentrate on the indigenous banks with its scope being limited to the co-operate and commerce bank Enugu which has experienced in recent times a big short fall in its operation.

The Nigerian Deposit insurance corporation (NDIC) which was set up to monitor the activities of these falling bank in Nigeria declared the bank (ACB) in 1993 as one of banks distressed.

Other limiting factors as to the successful conclusion of the project was the inability of the members to visit other banks that are distressed at Enugu and other Eastern zone due to the limited time factor.  Owing to this fact, the members of the group decided to do with the available data.

 

  • STATEMENT OF HYPOTHESIS

Using the information collected the researcher will attempt to test the validity of the following hypothesis

  1. Ho: Banks in Nigeria are not lucrative because of problem facing them.

H1:  Banks in Nigeria are lucrative upon the problem facing them.

  1. H1: The policy of central bank affect the operation of banks in Nigeria.

 

Ho:  The policy of central bank do not affect the operation of banks in Nigeria.

 

  • DEFINITION OF TERMS.

The terms used in this work needs to be defined to facilitate the understanding of the reader.  As one of the greatest Greek philosophers Aristotle (348-322 B.C) would put it he says “Before a discussion can be intelligible there must be a definition of terms”.

 

In defining the terms used, this project will prove that its content has been intelligibly written as to avail the reader of acquiring knowledge.  Used are as follows:

  1. A.C.B. African continental Bank Plc
  2. PLC Public Liability Company
  3. IBRD International Bank for Reconstruction

and development.

  1. NBN National Bank of Nigeria
  2. WACB West African Currency Board.
  3. CCB Co-operative and Commerce Bank
  4. BBWA British Bank of West Africa
  5. FORIGN (EXPATRIATE)

(BANKS)    These banks are banks where 51 percent of their equity shares are held by foreigners.

  1. ENTREPRE NEUR: One men business or sole business sector this means where one person organizes and manages a commercial understanding or business.
  2. NDIC Nigeria Deposit Insurance corporation:  Thiscompany belong to the government and it’s is set up to help those banks that are distressed and to monitor their activities.
  3. SFEM: Second-tier foreign Exchange Market.
  4. CBN: Central Bank of Nigeria which is the Apex

bank

  1. SAP: Structural Adjustment Programme
  2. ABC: African Banking Corporation.
  3. FM: Frequency Moderation
  4. ESBS: Enugu State Broad Casting Service
  5. BOFID Bank and other Financial Institutions Decree

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