CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The financial accountability of an
enterprise has gotten to a level that the roles of accountants as well as
auditors must not be neglected because they play a significant role in ensuring
financial probity and accountability of all private and public enterprises. The
accountants ensure the proper recording preparation and presentation of
financial statement which comprises of profit and loss account, the balance
sheet, cash and fund flow statement and so on line with the various statutory
guidelines and status.
For any organization to be
successful, it has to be partly measured by the level of achievement of its
objective at least possible cost. Since the enterprise cannot exist in
isolation, the achievement of the stated
objective are influence and dependent on various factors, one of which is
accounting policies and audit procedures used as tool towards accountability
and transparency in all companies. The accounting policies and audit procedures
are being influenced by both local and foreign, legal and economic environment,
Roberts (1979) said that auditing and accounting in any company attempt to
ascertain discipline in the entire financial transaction by ensuring the
accountability and transparency of the various custodians and users of public
funds. Financial accountability calls for a simplified structure that avoids
duplication and achieve greater impact, empowered and responsible managers, a
learner and more efficient organization that fosters management excellence and
is accountable for achieving results, proper accountability require that an
organization provides a professional or financial account (or justification) of
its activities to another stakeholding group or individual. It presupposes that
an organization has a clear policy on who is accountable to who and for what.
It involves the expectation that an organization will be willing to accept
advice or criticism and to modify its practices in the light of that advice and
criticism.
The role of accountants and auditors
in leading credibility to those financial statements is of paramount.
Importance in establishing markets. It is no longer a gainsaying that the
function of the auditors and accountant in leading credibility to financial
statements has been growing in important, rapidly and steadily over the last
five decades. Such reports are relied on heavily by potential investors,
creditors, financial analysts tax authority and others. Without such confidence
the whole basis of may companies would be destroyed. Thus the significance of
the role of accountants and auditors can never be disputed and is of great
contribution to the achievement of many organization.
1.2 STATEMENT OF PROBLEMS
The increasing and alarming rate at
which business fail, in recent time has raise double in the mind of investing
public as to relevance of accountants and auditors in presenting the collapse
through the process of certifying their accounts. This has raised dust and
conflicting view as to whether an accountant or auditor owes ultimate
allegiance to the public or to his client aid management. As a result of the
foregoing the new companies springing up have failed to receive the support of
both foreign and local investors. The reason behind this is not because these
companies do not show the prospect of future gain but the management of the
company and reports from the auditors.
Also inadequate of efficient and
effective records of accounts by the accountants and auditors that is
inadequate preparation, presentation and auditing of records by accountants and
auditors makes the fact and figures disclosed in the financial statement
obscured and unreliable for investors and other management of the enterprise.
FOR COMPLETE PROJECT
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