CHAPTER ONE
INTRODUCTION
BACKGROUND OF THE STUDY
Accounting widely seen as the background of every business has been defined in several languages by many scholars, but interestingly all the language see it as generating economic information that permits informed judgment and decision by users of such information. This Mustafa (1994:5) “ Accounting as the identification selection, measurement and communication of information in the form of costs and benefits both of direct and indirect nature to facilitate economically justified decision regarding the activities and resources of an organization. It should therefore be noted that the users of accounting information of any organization include the management of the organization.
The creditors of the organization, shareholders or owners investors at large etc. These groups have their different informational needs about an organization as a result of which we classify accounting into: 1. Financial accounting provides information for the extend users such as shareholders creditor, government agencies potential investor etc. 1. Cost and management accounting provide information for the internal users i.e. those in the various level of management. This study however, will dwell in management accounting as to highlight its roles in decision-making process of an organization in the light of the above management accounting, can be defined as an integral part of management concerned in identifying, presenting and interpreting information required by management for the following purpose: i. Formulating the policies of the organization stations planning the activities of the organization 1. Decision makings 1. Performance of appraisal at strategic department and operational levels etc. Based on the above management accounting is seen as the pillar (in terms of information provision) in the decision- making process of a business organization. This is based on the fact that before the manager or head of an organization can make eective decisions, he must have a good knowledge of the circumstance surrounding the environment on which he intend making a decision and this in the focus of management accounting.
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