THE EXTENT OF RELIANCE ON FINANCIAL ACCOUNTING INFORMATION FOR EFFECTIVE BUSINESS AND FINANCIAL DECISION IN CORPORATE ORGANIZATIONS

A CASE STUDY OF FIRST BANK OF NIGERIA PLC

Abstract

The study was directed towards examining the extent of reliance on financial accounting information for effective business and financial decision in corporate organization in  Nigeria (A case study of First Bank of  Nigeria PLC)

 

In carrying out the examination, certain problems were identified. These problem include the fact that some business are managed in intuitively, in their words regardless of the information content of financial statement.

 

Secondly, some organizations may unknowingly employ incompetent and unskilled manpower in sourcing financial accounting information.

 

The objective of the study include factors which may constrain or promote the effective use of financial accounting information, analyzing impact of and roles of financial accounting information ascertaining whether there is a direct relationship between financial accounting information and the decision made in corporate organizations, identifying the information derived from financial accounting, with these objectives in mind, two hypothesis were formulated, the first hypothesis is that financial accounting information has contributed to effective decision making in First Bank of  Nigeria Plc and the information content of annual financial statement of the bank is effective.

 

The descriptive research approach was chosen for this study and both primary and secondary data sources were explored. Two sets of questionnaire were distribute and in analyzing the data generated, simple percentages, statistical tables and chi-square were used. After data analysis, it was discovered that financial accounting information has contributed  to effective decision making in the bank. It was also discovered that the information content of annual financial statement in the organization is effective.

 

Other findings made include that inconsistent accounting policies and reporting practices make comparison of the performance of organizations difficult, the level of information given in financial statement is highly reliable.

At the end of the study answers were provided to some basic questions such as:

• How reliable is the level of information in financial statement?
• The rate of effectiveness of financial accounting information in achieving organizational objectives.
• Whether organizations rely mainly on financial accounting information for making business and financial decision.

CHAPTER ONE

• Introduction 1
• Statement of problem 3
• Objectives of the study 5
• Significance of the study 6
• Research hypothesis 7
• Scope and limitations of the study 8
• Definition of terms 9

 

CHAPTER TWO: LITERATURE REVIEW               11

• The nature of accounting information in –

First bank of nig. Plc                                          11

• Its financial accounting processes 13
• Its accounting standard 14
• Its accounting statement 15
  • Balance sheet 17
  • Income statement 22
  • Analysis of financial statement 22
• Financial accounting information and decision making in first bank of Nig.                                                 24
• The nature of decision making 25
  • Classification of decision-making processes in first bank of Nig. Plc.                                                 29
  • Levels of information available for decision making in first bank of nig. Plc.                                                 30
  • Effective decision making 31

 

CHAPTER THREE

RESEARCH DESIGN AND METHODOLOGY                  34

• Introduction 34
• Sources of data 34
  • Primary data sources 35
  • Secondary data sources 35
• Research method of approach 36
• Research instruments 36
• Sample selections 37
  • Statistical determination of sample size 37
• Method of questionnaire allocation 39
  • Allocation of questionnaire among first –

Bank of Nig. Plc for managers.                        39

• Contact method 41
• Method of data analysis 41
• Method of testing hypothesis 42
• Decision rule 43

References                                                                  44

 

CHAPTER FOUR: PRESENTATION

ANALYSIS AND COMPUTATION OF DATA           45

• Introduction 45
• Allocation and rate of returns of questionnaire45
• Analysis of data from questionnaire 47
• Testing of hypothesis 52

CHAPTER FIVE: SUMMARY OF FINDINGS          58

CONCLUSIONS AND RECOMMENDATION          58

• Summary of findings 58
• Recommendations 63

Appendices                                                        66

Shareholders questionnaire                             69

Bibliography                                                        73

 

CHAPTER ONE

1.1    INTRODUCTION

accounting is the recording, classifying and interpreting financial data relating to a particular organisation or person (Aspinall, 1970:37).

Accounting has one or more of the following objects:

1. The maintenance of a classified records of cash debtors and other property, of creditors and of changes in them.
2. The maintenance of a record of transactions classified to show gains or losses resulting from the various activities.
3. The periodic preparation of statements summarizing the economic results of the activities, and the financial position.
4. The use of such statements, by the management of an undertaking to assist them in the conduct of its business by the proprietors to assist them in assessing the efficiency of the management and in determining policy with regard to further investment and the withdrawal of profit, and by the government in determining tax liability.

The owners of any business naturally wishes to run their business as efficiently as possible in order to be able to do this, accounting information is kept). These accounting information enable the owner of the business to make comparisons of the amount of each cost and each expense, it also serves as a guide to business and financial decisions.

 

Accountants are responsible for preparing financial accounting information. Some if these accountant exercise their profession as the employees of commercial industrial and public practice of accountancy.

 

The financial accounting information prepared by accountants are of quantitative nature because it is usually expressed in monetary terms, through, non monetary information are also often contained in accounting reports.

The method and/or procedure for preparing financial accounting information are based upon definite principle which are usually rules and conventions which have been adopted as a general guide to action by the accountancy profession.

These principles are formulated in such a way that the practical details of accounting may differ from one company to another.

However, in order to secure acceptance such an accounting principle must be useful in copying with a practical recording problem, it must be reasonably objective, that is provides a similar answer in the hands of qualifies practitioners, and it must be feasible and as such not expensive to apply. These accounting principles are known as generally accepted accounting principle (GAAP).

 

1.2    STATEMENT OF PROBLEM

Most corporate organizations may have sound accounting system which enable them not only in their decision making but also in monitoring operating expenses relies on the information content of the financial statement is quite uncertain because they may be managing the business intuitively.

 

Financial accounting information involves technicalities such as quantitative analysis, adequate recording, reporting etc. some organisation may unknowingly employ incompetent and unskilled manpower and as such the financial accounting information prepared may not show a true and fair view of the financial strength. Profitability and future prospects of the organistion.

 

Some organistions have to realize that accounting information is the only medium through which both the management and external users get a clear picture of an orgnisation. They fail to realized, appreciate an accountants analysis in respect of the accounting information generated, this often leads to poor management decisions which will have negative effects on the performance of organization.

 

OBJECTIVES OF STUDY

The core objectives of the study if to examine the extent of reliance on financial accounting information for effective business and financial decision in corporate organisation in  Nigeria and in First Bank of  Nigeria to be precise.

 

More so, the research intends to accomplish the following objective:

1. To ascertain whether there is a direct relationship between the performance of First Bank of Nigeria and effective use of financial accounting information.
2. To ascertain whether there is a direct relationship between financial accounting information and the decision make in the bank.
3. To analyse the impact of and roles of financial accounting in First Bank of  Nigeria Plc.
4. To identify factors which may constrain or promote the effective use of financial accounting information.

SIGNIFICANCE OF THE STUDY

Business organization exists to provide goods and services and in return provide rewards to its owners. These two needs are linked to each other in the sense that profitable organizations are those that normally receive more resources from their customers in exchange of goods and services.

 

Some business organizations are non- profit oriented. However, irrespective of the types of organisation therefore always have accounting information regarding the value/normally in monetary terms, of the resources used in generating the required product and/or services used in generating the required product and/or services on the one hand and on the other, a fairly accurate measurement of income or profit or value of benefits earned from the disposal of their products and or services.

 

The study provide insight into the nature and roles of financial accounting information, as well as management needs for accounting information which may be said to resolve around the purpose of planning and controlling the affairs of an organisation making policy decisions and making choices among a number alternative options under circumstance which may be unexpected. This work will serve as a guide to others who may intend to undertake a review of the work or other related topics in the future.

 

RESEARCH HYPOTHESIS

In view of the nature and extent of the problem outlined for this study, it was considered appropriately to formulate the following research hypothesis in order to have a sound basis for a research of this nature.

These are:

 

Ho:    Financial accounting information has contributed to effective decision making in first bank of  Nigeria

Hi      Financial accounting information has not contributed to effective decision making in the bank

Ho:    The information content of annual financial statement of the bank is effective.

Hi:     The information content of annual statement in the bank is not effective.

 

SCOPE AND LIMITATIONS OF STUDY

This study was limited at various stages by several factors which include the following:

1. The time conduct, compile, produce and submit this work was not adequate due to compacted academic and non academic programme.
2. Accounting information is very vast, it covers various branches of accounting such as public sector accounting, financial accounting, management accounting etc. consequently the study is limited.
3. There were financial constraints however judicious use of available resources was made in order to achieve the objective of the study.

DEFINITION OF TERMS

Accounting : The provision of relevant economic information to permit informed judgement and decisions by users of the information.

Accountant: A person whose profession is to keep and examine business accounts.

Accounting assumptions/concepts: These are conventions which have been adopted on a general guide to action by the accountancy profession.

Generally Accepted Accounting principles (GAAP): They are accounting principle that have been developed largely in accounting practice that have been developed largely in accounting practice or have been established by an authoritative organistion.

Liabilities: Debts owned by a company e.g. trade creditors.

Owner equity: That shares of the business that owners own out – right.

Financial accounting information: These are information obtained as a result of systematic gathering, identifying, summarizing and reporting of business transaction in monetary terms.

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

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.

form>DELIVERY PERIOD FOR BANK PAYMENT IS  LESS THAN 24 HOURS

CALL OUR  CUSTOMERS CARE  OKEKE CHIDI C ON :  08074466939,08063386834.

AFTER PAYMENT SEND YOUR PAYMENT DETAILS TO

08074466939 or 08063386834, YOUR PROJECT TITLE  YOU WANT US TO SEND TO YOU, AMOUNT PAID, DEPOSITOR NAME, UR EMAIL ADDRESS,PAYMENT DATE. YOU WILL RECEIVE YOUR MATERIAL IN LESS THAN 2 HOURS ONCE WILL CONFIRM YOUR PAYMENT.

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THE ROLE OF THE ACCOUNTANT IN PROJECT FEASIBLITY AND VIABILITY APPRAISAL

(A CASE STUDY OF CASSAVA-STARCH PRODUCTION )

ABSTRACT

Nigeria  has been known to be solely dependant on crude oil as her major foreign exchange earner but with the crashing of oil in the world market during 1980’s coupled with  increased protectionism among nations, oil –generated foreign exchange dried up thereby forcing most industries which depended on imported invents to  either fold-up or  reduce capacity utilization.  The consequence of this was felt in the loss of employment opportunities for millions of Nigerians.  The youth and quarters of all the unemployed were under 25 years of age.

This scenario necessitated the structural adjustment programme (SAP) which was introduced in the country in 1986 to redress this economic imbalance.  In pursuit of this objective, backward integration for existing companies and self  employment  by  individuals have become the Nigerian corporate song.  To further  encourage investments and entrepreneurship, government has set up agencies such as   the  National directorate of employment (NDE), National Economic Reconstruction fund (NER fund), and mass mobilization for social Justice, self-reliance and Economic recovery.  In addition to this, government though the  Nigerian universities commission has directed that a course in entrepreneurship development be made compulsory in al the Nigerian Universities.

Fortunately, Nigeria is endowed with a  large number of potential entrepreneurs but most of them do not possess all the funds required to translate their  project ideas into reality.  Hence  they  often have  to seek additional funds from banks and other financial sources in form of debt or equity capital.  In order to protect their investments and avert the risk of business failure, these providers of project funds usually insist, in addition to adequate collaterals, or  a proper working plan in form  of feasibility and viability report as a sina qua non for providing the required facility  the  preparation of such appraisal report usually requires the contribution of a consortium of  professional experts, notably engineers, property values, financiers and  accountant.  However, the accountant is easily the primus interposes among  all other professional in this field. because of his special training the accountant possess the skill  to provide proof of viability  of projects which is all important.

Since the attainment of the government objective of rapid industrialization depends on the survival of individual projects which in turn  is a function of the credibility of the feasibility and viability studies prepared  before  take-off, the importance of the role  of the  accountant, To this end can not over-emphasized and so this project is intended to examine this role.

CHAPTER ONE

• INTRODUCTION /BACKGROUND OF STUDY

1.1    STATEMENT OF THE PROBLEM

• OBJECTIVES OF THE STUDY
• RESEARCH QUESTIONS
• SCOPE AND LIMITATION OF STUDY
• DEFINITION OF TERMS

CHAPTER TWO

• LITERATURE REVIEW

2.1    MEANING AND SIGNIFICANCE OF FEASIBILITY AND VIABILITY APPRAISAL

• BASIC DISTINCTION BETWEEN FEASIBILITY AND VIABILITY APPRAISAL
• IMPORTANCE OF FEASIBILITY AND VIABILITY APPRAISAL
• COMPONENTS OF FEASIBILITY AND VIABILITY STUDY
• FUNCTIONS OF THE ACCOUNTANT IN THE FORMATION AND DEVELOPMENT OF NEW ENTERPRISE
• FEASIBILITY AND VIABILITY STUDY AND THE ACCOUNTANT

CHAPTER THREE

• RESEARCH DESIGN AND METHODOLOGY

3.1    METHOD AND SOURCES OF DATA

• SAMPLING METHOD
• INTERVIEW AND QUESTIONNAIRS
• DESIGN OF INTERVIEW GUIDES
• ANALYSIS OF DATA

CHAPTER FOUR

• DATA PRESENTATION AND ANALYSIS OF DATA

4.1    MARKET ANALYSIS

• TECHNICAL ANALYSIS
• MANPOWER REQUIREMENT

CHAPTER FIVE

• SUMMARY,CONCLUSIONS AND ECOMMMENDATIONS

5.1    DECISION  AND FINDINGS

• CONCLUSIONS
• RECOMMENDATIONS

BIBLIOGRAPHY

 

CHAPTER ONE

1.0    INTRODUCTION /BACKGROUND OF STUDY

          After deciding on a product of services to produce or a  project  to embark on, Umeh (1977) stated that all proposals, and economic development demand feasibility and viability appraisal.  This feasibility and viability appraisal seek  to answer two important fundamental questions which are inevitable for prudent decision making at all levels in the  society.

The enterprenur must have a long range outlook on the intended product of services or project, examine the alternatives uses of capital and account for inflation in future valve of  cash flows, forecast future events and the financial requirements and carry out sensitivity and risk analysis.  These are highly technical areas of knowledge that call for expertise skills.   Therefore, this category of  valvaation holds  out limitless  opportunities and boundless scope for  services  and reward for  the accountants, economists, valves or appraisers

This study provides an analysis of the principles of feasibility and viability appraisal and highlight the essence of the subject matter.   It also brings share  focus the  accountants essential contributions which up till now has tended to be lost.

2.1    STATEMENT OF PROBLEM

          One of the problems of s successful industrialization in the  developing countries is un doubtly the lack of knowledge of how  to formulate a  project in such a way that it’s potential profitability either from the public or private view point can be estimated on a firm basis.

Many  good business ventures are abandoned after plunging in huge amount of money, because their originators just embarked upon them because they feel there is market demand and they couldn’t  get enough  funds to execute the project but regrettably according Uwakaneme (1980:3) many businessmen do not see feasibility study as a vital part of their project but they see it as an imposition and absolute necessity for fulfilling loan requirement or attracting equity participants.  Thus the more established the report, the better.

1.2    OBJECTIVES OF THE STUDY

          The  objectives of this study be reason of the problems stated above among which ware to appraise the potentials of feasibility and viability studies in successfully carrying out a project idea, determine the main techniques of appraisals commonly adopted for analytical purposes  and also to  determine the  reasonableness of it in practical situations, identify the general function of the accountant in the formation and development of businesses, identify the specific function of the  accountant in feasibility and viability appraisal and also  to illustrate the principles and application of feasibility and viability using a small scale cassava starch as a case study.

1.3    RESEARCH QUESTIONS

          The following fundamental questions have become imperative with respect to  the problems identified and they are:

1. What are the underlying principles and significance of feasibility and viability appraisal?
2. What effect has feasibility and viability appraisal have on the survival or failure of new projects?
3. What are the functions of the accountant in the preparation of credible feasibility and viability appraisal in order to help prevent project failure?
4. How would the accountant appraisal the viability of a small scale cassava starch project in order to properly advise a potential investor on such projects?

1.4    SCOPE  AND LIMITATIONS OF THE STUDY

For a more critical analysis of this role in carrying out feasibility  and viability appraisal on cassava starch production.  The limitations of this work includes united time apart from normal academic work, there are so many other related class-room works engaged courses which in turn affected the research work.

Also research works in Nigeria, especially those adopting interview approach are beset with a lot of limitations which include mass illiteracy, dearth of reliable secondary data prejudice against the researcher and un due secrecy in which many of this were experienced in the course of this study.  And finance was also one of the limitations.

These limitations not with standing. It is believed that the findings of the study could be useful and should form a basis for further studies on the subject.

1.5    DEFINITION OF TERMS

For the purpose of this study the following are the terms used.

1. FEASIBILITY STUDY

          The stage  of fact finding aimed at determining the business profit potentials and return on  investment is known as feasibility study.  This study examine the market,  technical, financial requirement, manpower requirement e.t.c

2. FEASIBILITY AND VIABLITY STUDY

Feasibility and viability study

According to Uwakaneme (1990: 4) feasibility and viability study is an investigation of the possibility of implementing a business idea, or government project in order to obtain a certain desired minimum objective with the least danger or difficulty.

3. APPRAISAL

          Umeh (1977:5), stated that appraisal is the same as  valuation and that it is the estimate or an opinion, fixing the price for something.  An appraisal may be made off hand and delivered orally or presented in an authoritative and a comprehensively written form to the client who requires the appraisal to make a decision or to execute a policy.

4. PROJECT:

          A project is the use of one or more scarce resource during a specific time period for the  purpose of producing some economic returns or out put at latter time resources it is also the consumption in the near future of scarce or at least limited resources in the hope of obtaining in return over a longer period some benefits.

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COMPLETE MATERIAL  COST  N2,500 Or $10.  FRESH  PROJECT MATERIAL  COST 50,000 NAIRA FOR UNDERGRADUATE, OTHERS 100,000 -200,000 NAIRA.

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

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.

form>DELIVERY PERIOD FOR BANK PAYMENT IS  LESS THAN 24 HOURS

CALL OUR  CUSTOMERS CARE  OKEKE CHIDI C ON :  08074466939,08063386834.

AFTER PAYMENT SEND YOUR PAYMENT DETAILS TO

08074466939 or 08063386834, YOUR PROJECT TITLE  YOU WANT US TO SEND TO YOU, AMOUNT PAID, DEPOSITOR NAME, UR EMAIL ADDRESS,PAYMENT DATE. YOU WILL RECEIVE YOUR MATERIAL IN LESS THAN 2 HOURS ONCE WILL CONFIRM YOUR PAYMENT.

WE HAVE SECURITY IN OUR BUSINESS.   

MONEY BACK GUARANTEE

DIVISION OF LABOUR AND SPECIALIZATION, A TOOL OF INDUSTRIAL GROWTH AND DEVELOPMENT. ( A CASE STUDY OF VITAFOAM INDUSTRY, ENUGU

ABSTRACT

The research study conducted on this topic “Division of labour and specialization, a tool of industrial growth and development” was extensively done to include all the works and of it that could be sued to achieve industrial growth and development in any industry.

Indeed, for a firm, government establishment to grow, there is need to master the use and application of division of labour and specialization since no man is an Island, there exist division off labour in our homes, offices, firm every schools and other institution of higher learnings.

Despite few disadvantages attributable to this principle, the advantages however, outweighed its demerit for example, increase production scale, economy in the use of machine saving of time, etc are the economic benefit obtained in the application of the principle.

Though the research work reveals that poor application of the theory may not yield fruitful result. Such as lack of motivation to employees, irregular promotion, law salaries etc may hamper the process thereby resulting in inefficiency.

Therefore, this work has been properly administered to provide an enlisting solution to the area of problems and suggest critical ideals that would guild any management to achieve his industrial goal.

PROPOSAL

The research topic that will be conducted on this topic “Division of labour and specialization; a tool of industrial development and growth tends to point out all the nooks and carry that can be used to achieve industrial growth in any industry.

The research also tends to point out the advantages and disadvantages involved and the poor application that will not yield fruitful result.

The research study also points out the solution to the area of problem and suggest critical ideas that would guild any management to achieve his industrial goal.

CHAPTER ONE

1.0     Introduction                                                                            1

• Statement of study 3
• Objectives of the study 5
• Significance of the study 6
• Formulation of hypothesis 6
• Scope and limitation of the study 9
• Definition of terms 9

CHAPTER TWO

2.0     Review of related literature                                            13

• Meaning of division of labour 15
• General division of work in vitafoam industry 22
• Specialization in vitafoam 26
• Growth and development in vitafoam industry 28
• The company corporate policy statement 30
• Company profile 31
• Report of directors 36
• Report of the auditors 49
• Five year financial statement/summary 51
• Cash flow statement 53
• Statement of value added 55
• Accounting policies 56
• Unclaimed dividend warrants and share certificate 59

CHAPTER THREE

• Research design and methodology                                      63
  • Validity and reliability of the measuring instruments. 69

CHAPTER FOUR

• Presentation, analysis and interpretation of data 71
• Testing of hypothesis 83

CHAPTER FIVE

• Summary of findings, conclusion and recommendation
• Summary of findings 84
• 86

 

 

 

 

 

 

 

 

CHAPTER ONE

1.0     INTRODUCTION:

To enhance the better understanding of the project topic – “ Division of labour and specialization a tool of industrial development and growth”, it is proper to start its origin and consequently the modern approach.

Division of labour has been with us for a time now.  It started in a primitive form with the creation  of human being by God, God created man and women and made their  function known to them.  While the man was  made to get the daily bread for the family, the woman was also changed with child bearing.

Division of labour can also be formed among insects and ants.  In ants the soldiers  are meant to secure the ants, the workers are meant to look around for  food while the Queen and the  king  are charged for child bearing.  All this are form of division of labour.

Similarly, specialization has taken place in this primitive Form of division of labour.

From the study of history, it is known that in the most primitive community everybody tried to be self sufficient.  Each person provided whatever he needed.  But as the population grew, life became a little more difficult.  Nature  was namable for provide for every thing and individual  wanted in a particular geographical region.  It then became necessary for  each individual to engage in a particular activity  in which he can undertake with much case.  Since he could not provide or be in access of everything he needed, it became necessary for him to produce more of what he could, so as to exchange the extra quantity for what he needed but which he was unable to produce.  This is form of division of labour and specialization in the rural community.

In modern world, the origin of division of labour dates back to the period of the industrial revolution.  With the change in the production methods, operations in industries were split up to different aspects and people started to specialize in different aspect of the production processes.  With this specialization, the product of a simple commodity necessitated the co-operation of many individuals who specialize in different aspects of production process.

This productions brought about increase in output.  Adam smith identified this as early as 1776 in the book, which he published at that time which be called “Enginery into the wealth of nation”.  By his visits to put making industry he discovered that as a result of division of labour, the output of the industry increased by more than 200%.

Finally, the modern approach of division of labour is about the effectiveness of employers of labour to harness all available economic resources at their disposal to the attainment of qualitative and grantitation provision of goods and services.

 

1.1     STAEMENT OF STUDY

          Perhaps, over the year, the most prominent reason for industries undergoing poor industrial development is due to inadequate attention given to division of labour and specialization.  This country is blessed with natural resources both human and material. Yet we remain underdeveloped.  Now it is time to ask, division of labour and specialization can’t we practice them in our various  home, industries , communities etc.  why can’t our industries change its industrial status through this technique? My own opinion is  stated below.

Since the concept of division of labour dates  back to 1776 when Adam smith had a visit to a pin-making industry, there  was an  increase in their production by over 200%. Similarly, vita foam industry a firm that practice division of labour and specializes in foam making in Nigeria,  in the year  2003, its annual turnover was N3,887 million.  This is because the management segregates duties.  The company which first opened in 1963 at Ikeja, Lagos is now having five factory location and seven main distribution channels through out the federation.  This growth and development was as a result of effective division of labour and proper management.

From foreign discussion, one can equally agree with me that these economic tools can be used to attain industrial development in our industries as a whole.  But the critical issues are how can this  positive change occur.

 

 

1.2     OBJECTIVE OF THE STUDY

          Apart from knowing the extent of mass production and industrial growth of vita foam industry, there are several other objectives of this study.  They are:

• To study the activities of vita foam industry
• To understand the different products manufactured by the industry both main product and by product.
• To know why vita foam industry’s products are of higher quality when compared with other industries engaged in related goods and services .
• To know the extent of changes in personnel management as it affect division of labour and specialization.
• To know the extent of turnover as it affect the demand of its product because it express people’s likeness for their product.
• To point out or give recommendation in areas where the company has  shortfalls in it’s use of labor services.

 

 

1.3     SIGNIFICANCE OF THE STUDY

          The apparent reason why I write on this topic is to recommend to top managers be it government owed establishment or individual owned, the heed to embark and encourage  division of labour in such establishments.  As we all know, division of labour and specialization contributes immensely to industrial development and growth.

Since we all know that if increase output, saves time, avoid duplication of tools, enable specialization and less fatigue at work.  It becomes clearly that every manager should master its use and application for fully developed and efficient management.

 

1.4     STATEMENT OF HYPOTHESIS

          In order to determine the validity and reliability of the information gathered the following hypothesis were formulated.

 

1. Ho: Division of labour and specialization is not a tool of industrial development and growth.
2. Ho: Division of labour and specialization increase productivity in an industry

Hi : Division of labor and specialization increase productivity in an industry.

 

3. Ho: Vital foam industry has not recorded any significant result throughout the use of division of labour and specialization

 

H₁: Vital foam industry has recorded significant result through the use of division of labour and specialization.

 

1.5     RESEARCH QUESTIONS

          Several questions were formulated to enable me form an opinion, for instance in production area:

Do managers of vita  foam use the technique of division of labour and specialization in their  industrial production, purchasing sales and personnel management?

Are they  complying with the laid down policies and objectives of the company?

Do they, the management use high qualified and skilled labour or unskilled and low paid workers?

Is management performing up to anticipated level of production?

Marketing are:

Have the management separated duties?

Is it one person that receives and records cash?

If yes, how can they predict and discover fraud?

Do they keep records of inventories?

If yes by whom?

Purchases areas:

Does the purchasing manager always sign every purchased invoice?

Is every purchase of material actually be the quality approved?

How does the company made payment?

Personnel cost area:

Do the management have time card

Is employee actually paid for what they actually worked for?

And finally, do the company has good internal control system s

 

1.6     SCOPE AND LIMITATION OF THE STUDY

          Specifically, the scope of this work is limited to division of labor and specialization as it affect vita foam industry Enugu branch.  This include labour utilization, skilled and unskilled labour, especially production aspect, the reference were made to factory side Aba. Though the industry has many factory and depot, but I limited my study to activities of Enugu depot and factory of Aba.

 

DEFINITION OF TERM:

1. Division of labour – Breaking down of production process into deferent stages so as to enable each person partake in the production line to perform and specialize on work he know best.
2. Specialization – When an individual, firms or government concentration on production related commodities and exchange for others in which it do not produce.
3. Industrial growth – This can be defined as a rapid and sustained rise in output with low and efficient input.
4. Industrial development – Overall orends or process in which output transformation are achieved with little reference to or significant degree of industrial growth.
5. Firm – an arm of industry engaged in production
6. Industry – a group of firm producing similar products.
7. Formulation of hypothesis – series of questionnaires prepared to enable on form an
8. Scope and Limitation – The extent and sample size used in the study.
9. Objectives of study – The reason why the researcher undertake such project work.
10. Literature review – Making references to other material where related problem of the study has been treated.
11. Company corporate policy – The incorporation clause of the company.
12. Company profile – Mean brief story about history, growth, development and prospect of the company.
13. Reports of directors – Statement enclosed in the annual report pointing out the area of weakness or otherwise satisfaction of board of directors.
14. Reports of the Auditors – Statement enclosed in the annual report stating whether in their opinion the assets and liabilities shows true and fair view of income statement.
15. Five years financial summary – As the name implies show in brief with comparative figures the  five years financial statement.
16. Cash flow statement – Indicated the sources and application of fund.
17. Statement of value added – The extra wealth created by a business entity in cause of its effort to provide goods and services.
18. Accounting policy – It means accounting rules and concept being adopted by the company in dealing with its records and accounts.
19. Shareholders information – Means such vital information relating to Liquidity of the company profitability, dividends and returns on capital   employ as would enable them make future forcast.

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