THE EXTENT OF RELIANCE ON FINANCIAL ACCOUNTING INFORMATION FOR EFFECTIVE BUSINESS AND FINANCIAL DECISION IN CORPORATE ORGANIZATION.(CASE STUDY OF FIRST BANKS OF NIGERIA PL ). A RESEARCH PROJECT MATERIAL ON ACCOUNTING
The study was directed towards examining the extent of reliance of financial accounting information for effective business and financial decision in corporate organisation in Nigerian.(A Case study of First Bank of Nigeria PLC) In carrying out the examination, Certain problems were identified. These problems included the fact that some business are managed Ineffectively, 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, analysing 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 hypotheses 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 distributed and in analyzing the data generated, simple percentage, statistical tables and chi-square were used.
After data analysis, it was discovered that financial accounting information has contributed of effective decision making in the bank. It was also discovered that the information content of annual financial statement is 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:
– 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.
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 d 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 f its business by the proprietors to assist them in assessing the efficiency of the management and in determing policy with regards to further Investment and the withdrawal of profit, and by the government in determing 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 services as a guide to business and financial decisions.
Accountants are responsible for preparing financial accounting information. Some of these accountant exercise their profession as the employees of Commercial Industrial and public practice of accountancy.