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The Role of Accounting Information as an Aid to Management in Decisions Making in an Organization
ABSTRACT
The motive of this research work is the increasing importance and impact of accounting information towards aiding decision making organization; accounting concept and convention are some of the issues hampering effective decision making in most organization. The research aims at: examining how and to what extend has accounting information aid decision making in United Bank for Africa plc, Abuja. Who are the decision makers and how is been channel the organization. The method used for the data collection includes primary and secondary data source of information was obtained from the 30 respondents using sample random techniques.
CHAPTER ONE
1.0 INTRODUCTION
Accounting is the language of business as it is the basic tool for recording, reporting and evaluating economic events and transactions that affect business enterprises. It processes all documents of a business financial performance from payroll, cost, capital expenditure and other obligations to sale revenue and owners equity. It provides financial information about one’s business to the internal and external users, such as managers, investors and others.
It is sometimes referred to as availability of accounting information (Arneld and Hope 1990). The making of decision, as everyone knows from personal experience is a burdensome task, says Wadia (1966). In most cases indecision is as disastrous as making a wrong one, therefore a plan of action is Indispensable. Management is constantly confronted with the problem of alternative decision making especially knowing that resources are relatively scarce and limited.
It is therefore pertinent that good accounting information be made available for proper and accurate decision making, maximization of profitability and optimal utilization of scarce resource.
Accounting information is not only necessary for evaluation of the past and keeping the present on course; it is useful in planning the future of the enterprise. According to Mbanefo(1997), Conventionally call budget/budgeting targets, which give meaning and direction to operations of the organization within a defined period. At the end of the budget period the external results are compared with budgeted performance and discrepancies (variance) are analyzed for purposes of exposing the causes so as to prevent re-occurrence.
Budgeting uncovers potential bottlenecks before they occur, coordinates the activities of the entire organization by integrating the plans and objective of various parts. The budget ensures that the plans and objectives of the parts are in consistency with the broad goals of the organization.
It compels managers to think ahead before formalizing their planning efforts and finally provides defined goals and objectives which serve as benchmarks for evaluation of subsequent performance.
Management is the art of working particularly through people, for the achievement of the broad goals of an organization (Ejiofor 1987), in trying to achieve these goals the manager has to map out strategies to find out the accounting information suitable for the company.
Management accounting uses both financial and non-financial information and is generally intended for the use of internal users who use the information to make decisions that help achieve the goals and objectives of the organization. Financial information used by management accountants include sale growth, profits, return on capital employed and market shares, non-financial information’s include customer satisfaction level, production quality, performance of competing products and customer loyalty. Management accountants use financial and non- financial information to aid business decision-making (Melissa Bushman 2007).
Information is power, and power is double edged sword that can mark or destroy an institution. Information can come from different sources, but the purpose of this project work attention will be focused on Appraisal of accounting information as an aid to management decision making (a study of UBA plc. Abuja branch). Accounting information can be define as all relevant data accumulated by the application of an accounting system, tools and techniques. Such deductions which invariable help in decision making aimed at controlling and planning for the business.
Accounting in a winded sense is a language of a business. It serves the same purpose for all organization, both private and public in making the appropriate decision at the right time.
1.1 BACKGROUND OF THE STUDY
Accounting is an ancient art, certainly as old as money, even the act rudimentary in the beginning has evolved in response to the social and economy needs of the society becomes more complex over the years. Accounting has developed new concepts and techniques to meet the user increasing needs for financial information. People in all civilization have maintained various types of record for business activities. The old Babylonia around 2050 BC for payment of wages and salaries.
Similarly record were found in ancient Egypt, Greek Rome, the earlier English records were compelled at the direction of William the conqueror in 11thcentury to ascertain the financial resources of the kingdom.
Early accounting mostly dealt with limited aspect of financial operation of private and government parasternal, complete account for an enterprise developed later in response to the commercial need in the republic of ltaly
1.2 STATEMENT OF THE PROBLEM.
The United Bank for Africa (UBA) plc was established long ago and now merged with standard Trust Bank has faced various problems which include losses through carelessness, dishonesty, fraud and robbery.
This research work is aimed at finding out ways and manner in which the problem of fraud and other irregularities can be dealt with and to make an assessment of the usefulness of accounting information in the field of management decision making.
1.3 OBJECTIVE OF THE STUDY.
As a central objective, this study seeks to evaluate the role of accounting information as an aid to management in decisions making in an organization. But more specifically, it attempts to achieve the following:
I. To determine the causes of failure in the attainment of organization objective, resulting from lack of adequate utilization of accounting information.
II. To determine the effects of managerial neglect of UBA plc the achievement of the organizational goal.
III. To assess the effort of UBA plc in the use of accounting information for the management use.
1.4 RESEARCH QUESTION
I. Does decision making help an organization output?
II. Does management provide information for the management team?
III. Does management control help the activities of the firm?
IV. Does the management achieve its aims and objective?
V. How can the members of staff meet up with their day to day activities and the role of decision making to managers and affect them positively or negatively.
1.5 STATEMENT OF HYPOTHESIS
In any organization, Appraisal of accounting information is needed in other to transform the business to a high level. Management clearly require a system which system which satisfy their need and at a maintain cost.
However, the major problem confronting the implementation of good accounting information to management decision making are summarized thus;
a. Null hypothesis: this is the type of hypothesis that when tested would be true
b. Alternative hypothesis: this is type of hypothesis that when tested will be false answer and not correspond to the statement of general problem.
HO: Accounting information has significant impact on organization decision making.
H1: Accounting information has no significant impact on organization decision making.
1.6 SIGNIFICANCE OF THE STUDY
The importance of this study cannot be over emphasized. It will be useful to general public and stakeholders in the banking industry. The outcome of the research will serve as basis for future references and also enable the researcher to determine and appraise accounting information as an aid to management decision making.
1.7 SCOPE OF THE STUDY
This research work seek to look into and appraise accounting information system as an aid to management decision making in United Bank for Africa Plc.(UBA) from the period 2002 to date.
1.8 DEFINITION OF TERM
I. Accounting :accounting can be define as the process of collecting, recording, identifying, measuring, summarizing and communicating economic and financial information to permit informed judgment and decision making by users of the information
II. Cost account: cost accounting is the term normally used to describe the procedure for accounting cost relating them to the specific product and department mainly for the purchase of stock valuation and profit determination. It is further defined by the institute of cost and management accounting as the application of costing and cost accounting art and practice of control and the ascertaining of profitability. Include the presentation of information derived there for the purpose of management decision making.
III. Management accounting: it an integral part of management concerned with identifying, presenting and interpreting information used for the following;
a. Formulating strategy through setting objectives and plans of achieving the objectives
b. Planning and controlling activities through budgeting and budgetary control
c. Decision making by taking optional action to minimize cost and increase value of the company, optimizing the use of resources through setting standards, effective supervision and motivation of the work force towards achieving maximization of production.
d. Safeguard asset through control of operations and use of assets
e. Disclosure to employees though management accounting report, routine reports and analysis.
CHAPTER TWO
2.0 LITERATURE REVIEW
2.1 INTRODUCTION
The major objective of commercial bank all over the world is provision of services and its expansion where practicable. To achieve this success, certain fact and figures must be taken into consideration, measured, classified, analyzed, summarized and communication to the parties concerned within the bank as well as other interested users of accounting information, such information are highly needed by managers for effective planning, organizing, staffing, controlling and coordinating the overall activities of that particular organization. It is also important to give a report on business activities by preparing financial statement and other report of financial statement, the account is made to interpret on how the business transcend compare to previous year and other similar business therefore, appraisal of accounting information gives business or organization the opportunity to go ahead, if a company is working at a profit side or loss, the company will understand via process of record of transaction kept by the organization.
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SOLD BY: Excellent Project| ATTRIBUTES: Title, Abstract, Chapter 1-5 and
Appendices|FORMAT: Microsoft Word| PRICE: N5000| BUY NOW |DELIVERY
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