CHAPTER ONE
1.0 INTRODUCTION
An organization needs qualitative information to function or make decision; the available of such information make the organization to function in the most effective and efficient manner. This information is provided by the accounting system to the management, which uses it primarily to accomplish three (3) broad purposes, viz: 1. To provide financial statement to interested external users 2. To plan the operations of the organization in both the short and long run. 3. To control the result of its operations In financial accounting, the responsibilities of the accountant ranges from recording and analysis, summarizing and reporting the result of the activities of the organization to creditors, stock holders and prospective investors, government, labour, environmental organization and others. In the case of reports to external users, they are classified for general purpose; they are financial statement, the income statement, the retained earnings, the balance sheet and the statement of financial position. People who protest or enhance their investment in the organization as by other who have a special interest in it use this statement.
In management accounting, accountants provide information for use by office within the organization (the managers) rather than for use by other outside the organistion, such information are mainly decision making concerning the internal function organization. Management accounting also provides information to the decision makes for the following purpose: 1. Formulation of policies 2. Planning and controlling the activities of the enterprises 3. Safeguard the assets of the organization 4. Disclosure of employee’s area of specialization 5. Decision taken alternative cause by action. Management and financial accounting may be understood by considering the basic goals of financial accounting is to direct forms of operations to maximize income the period measure net income used by the management in making decision to avoid what may be considered as an unwise decision to external user or vice versa. However, the relevance accounting information effective decision making in this research work, the degree of the relationship shall be clearly spelt out and identified.