RESEARCH PROPOSAL

This research work title an appraisal of the impact of

accounting in management control system aims at

investigating scientifically the invaluable and

indispensable role, functions and relevance that

accounting play within the overall decision making,

planning and control process in organization.

This study will be encapsulated in five chapters; chapter

one the introductory chapter will give a conceptual

overview of the subject matter. It includes the

background of the study, statement of the problem,

objectives of the study, statement of the hypothesis,

significance of the study, scope of the study, limitations

of the study and definition of important terms.

Chapter two literature reviews will provide a structure

and theoretical frame of reference for subsequent

investigation on the subject matter. Various aspects of

management control and accounting systems, such as

performance measurement, evaluation and incentives will

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to be review throughout the study. Particular attention

will be given to the behavioral and motivational impact of

various management accounting systems.

Chapter three, the research methodology will attempts to

discuss the various ways or method adopted by this

study for data collection and analysis, the research

design as well as research population and sample.

Unstructured oral interview complimented with content

analysis tools of inquiry, will be use in obtaining relevant

data for analysis. This study is based on an exploratory

case study of Ministry of Interior, Abuja.

As for the data collected via these tools outline above will

be statistically presented in chapter four for analysis

where simple percentage rating and Chi-square statistical

technique of analysis will be employ to determine the

relevance, validity and reliability of the research findings.

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Chapter five, the last but certainly not the least

important chapter will capture the discussion of the

research findings, conclusions and recommendations for

further investigation.

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My representative sample of 200 out of 1520 staff were

selected in a stratified way based on random sampling

technique from the following department of Federal

Ministry of Interior Abuja

Summarily my representative sample size of 200 from the

population of 1520 were selected in a stratified way

based on random sampling technique from the Federal

Ministry of Interior Abuja.

Since the subject of research is enormous and I cannot

exhaust it all at this period of my research, the

researcher has employed a social survey in the research

finding, and it will be in an analytical from. The study

primary source of data is the unstructured oral interview

of the staff of Federal Ministry of Interior Abuja.

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After underlining the relevance of the banking industry in

promoting investment economic growth and development.

It went further in chapter two to explore the concepts of

monetary policy and monetary influence. The study

observes that economists generally and unanimously

agree that monetary stimulus affects economic

performance including banking activities. The

controversy centres on the transmission mechanism and

effectiveness of monetary influence. Similarly the study

finds out that it is generally believed that monetary policy

in Nigeria influence the performance of the banks largely

through liquidity, credit and exchange rate channels.

Furthermore, to empirically verify this postulations, in

Chapter three a simple banking performance model is

specified to depend on monetary policy measure .A

simple linear regression technique of analysis (OLS) was

employed to obtain estimates of the variables for

observed data.

The analysis and evaluation of the estimated model

presented in chapter four supports our apriori

5|Page
expectation and the alternative hypothesis of a positive

relationship between the variables of our interest. The

study also noted that deposit mobilization and other

selected performance indicators of the banking industry

were positively affected in the period under study. Even

though the observed monetary influence are not as

effective as expected due to some impediments like the

mandatory inflationary financing of government fiscal

deficit by CBN and the distress element inherent in the

banking sector.

Based on the above findings, conclusions were drawn

and suggestion and recommendation made. This study

advocates a cautious gradualism to deregulation

(moderate repression) of the financial system, a discipline

fiscal environment and sustained use of indirect

technique of monetary management (market based

technique) as a policy menu for accelerating the

performance of the banking industry.

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 TABLE OF CONTENTS

Page
Title page
Certification page
Dedication
Acknowledgment
Abstract
Table of Contents

CHAPTER ONE INTRODUCTION

1.01 Introduction
1.02 Background of the study

1.03 Statement of Problem

1.04 Objectives of the study

1.05 Statement of Hypothesis

1.06 Significance of the study

1.07 Scope of the study

1.08 Limitation of the study

1.09 Definitions of terms

CHAPTER TWO: LITERATURE REVIEW

2.1 Introduction
2.2 Overview of Accounting, Accountability and

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 Account
2.3 Management Control
2.4 Management Accounting
2.5 The role of management accounting
2.6 Management planning and control systems

2.7 Using Accounting information for Decision

making, planning and control
2.8 Decision-facilitating and Decision-influencing
role of Accounting information
2.9 Variance analyses for control
2.10 Relevance of internal Audit in decision making
for control
2.11 Internal check and internal control
2.12 Overview of the case organisation (Ministry of
Interior, Abuja)
2.13 Appraisal of the role of Accountants

CHAPTER THREE: METHODOLOGY

3.1 Research Methodology

3.2 Introduction
3.3 Research Design

3.4 Population of the Study and Research Sample

3.5 Method of data collection

3.6 Technique of data analysis

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CHAPTER FOUR: PRESENTATION AND ANALYSIS OF
DATA
4.1 Data presentation and analysis

4.2 Introduction
4.3 Research Question/Hypothesis
4.4 Discussions of findings

CHAPTER FIVE: SUMMARY CONCLUSION AND

RECOMMENDATION

5.1 Summary, Conclusion and Recommendation

5.2 Summary of Major Findings

5.3 Conclusion
5.4 Recommendations for further investigation

References

Appendix

9|Page
 CHAPTER ONE

1:0 INTRODUCTION

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.

1:1 BACKGROUND OF THE STUDY

Accounting is traditionally seen as fulfilling three

functions: Scorekeeping: capturing, recording,

summarizing and reporting financial performance.

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 Attention-directing: drawing the attention of managers

to, and assisting in the interpretation of business

performance, particularly in terms of the comparison

between actual and planned performance.

Problem-solving: identifying the best choice from a range

of alternative actions.

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.

While the purpose of management control processes is to

carry out the strategies arrived at in the strategic

planning process and thereby to attain the organizations

goals. In that sense, management control is a mechanism

that enables managers to make informed decisions.

The purpose of management control processes is to carry

out the strategies arrived at in the strategic planning

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process and thereby to attain the organizations goals. In

that sense, management control is a mechanism that

enables managers to make informed decisions. The aim

of this research work is to empirically appraise this

central role of accounting in management control

systems within the organizational context.

Our current era is described as Information Age, where

the production and informations delivery of services has

become a widespread product and the demand of it

continues to increase. Accounting Information System

plays a pivotal role in decision makers service and

control system; the need for information is basic for

concrete and explicit management decision to ensure the

success and survival of an organization and since the

aim of any business organization is profitability

Accounting information is indispensable to achieving this

goal.

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In days gone by there were little incentives for firms to

maximize efficiency and improve management practices

or to minimize costs, as cost increases could often be

passed on to customers. However, now organizations

encounter severe competition from overseas competitors

that offered high-quality products at low prices. Virtually

all types of service organization have also faced major

changes in their competitive environment. Before these

organizations were not subject to any great pressure to

improve the quality and efficiency of their operations or

to improve profitability by eliminating services or

products that were making losses. Hence cost increases

could often be absorbed by increasing the prices of the

services. Little attention was therefore given to developing

cost systems that accurately measured the costs and

profitability of individual services. Deregulation, intensive

competition and expanding product range created the

need for service organization to focus on cost

management and develop management information

system that enable them to understand their cost base

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and determine the sources of profitability for their

products, customers and markets. Many service

organizations have only recently turned their attention to

management accounting.

Obviously, these significant developments brought to the

fore the strategic role and functions of accounting in

management control system. Before good decision can be

made there must be some guiding aim or direction that

will enable the decision-makers to access the desirability

of favouring one course of action over another. Hence,

this research work seeks to evaluate the importance of

good accounting information as it relates to maximizing

the profitability target of an organization. Therefore it is

in appreciation of the invaluable and indispensable role,

function and relevance that accounting play in

management decision making, planning and control that

provides the impetus for this research study.

1:2 STATEMENT OF THE PROBLEM

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 Information is indispensable for decision making in

any business organization. The problem however

lies in the quality and validity of the information,

that is, if it is timely, adequate and clear. According

to the report of the Joints Auditors First Bank,

Annual Report and Account (2000/2001 page 30)

falsified accounting information was the reason for

many failed banks in Nigeria. The major purpose of

the use of accounting information is to minimize

risk, failure and uncertainties and also stay ahead

of competitors. Notwithstanding the immense

benefit of use of accounting information, it is

generally acknowledged that most unethical

accountants generate inaccurate information or

falsify accounting information and so result in

failure of organizations to achieve desired goal.

There are cases of managers refusing the use

accounting information because of their inability to

interpret such data, thereby making the

organization to remain at status quo ante. So many

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 outfits have collapsed in recent years due to the

following factors:
i. Impropriety of transactions which are not in

conformity with established rules.

ii. Lack of transparency and accountability in

business transactions.
iii. Lack of proper planning before embarking on

business transactions.
iv. Lack of adequate internal audit control

measures for early detection and prevention of

fraud, errors e.t.c.

v. Lack of accurate accounting information for

decision making at the appropriate time.

1:3 RESEARCH QUESTIONS

i. Does management think that the information

provided by an accountant is indispensable for

management decision making, planning and

control?
ii. Is accounting an increasingly part of

management decision making.

iii. How the accountants do aids decision and

policy maker in speedy attainment of

organizational objective.
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 iv. What are the techniques that accountants use

in enhancing management decision making,

planning and control?

1:4 RESEARCH HYPOTHESES

The research work is aimed at finding out the extent to

which an accountant has a role to play in management

decision making, planning and control of an organization

or business ventures. The following hypotheses have

been propounded.
H1: Accounting information in organization has a

significant positive impact in management control

system.
H0: Accounting information in organization has no

significant positive impact in management control

system.

1:5 OBJECTIVES OF THE STUDY

This study examines the role of accounting in

management control system. It primarily aims at finding

out scientifically the following

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 The relationship between a sound accounting

system and decision making, planning and control

process in organization.
Accessing the role, functions and relevance of

accounting information in enhancing management

decision making, planning and control.

X-ray how the accounting information aid decision

and policy makers in speedy attainment of

organization objectives.

1:6 SIGNIFICANCE OF THE STUDY

The significance of the project includes but not limited to;
i. It will assist management and accountants

appreciate their interdependent roles in

arriving at sound management decision

making, planning and control of operations for

improvement of their organizations.

ii. Assist in reduction of fraud and sharp

practices in their organizations through early

application of proper control measures.

iii. Exposed lapses and other major causes of

failures in firms well ahead of time through

regular careful comparisons of targets with

plans, thus giving management an opportunity

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 for introduction of necessary corrective

measures.
iv. Benefit students undergoing courses in

accounting with the necessary concepts to get

a grasp of the accounting and control

mechanisms as well as the practical skills to

deal with the management control systems

issues.

1:7 SCOPE OF THE STUDY

The scope of this study covers the impact of accounting

in management decision making, planning and control in

government or privately owned firms. It will highlight

problems and challenges faced by both accountants and

management in an organisation.

1:8 LIMITATIONS OF THE STUDY

Given the resources time and money available for the

project, survey carried out was restricted to published

data and information obtained from the account and

finance department of Federal ministry of Interior Abuja.

1:9 DEFINITIONS OF TERMS

COST OF CAPITAL: It is the required rate of return on a

project. It represents the market rate of return between

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present and future money (Naira). In other words, it is

the required rate of return needed to justify the use of

capital. It is the rate f return the organization/ministry

mist earn on investment to maintain the market value of

share price.

AUDITING: The examination of books of accounts and

records of an organization by independent qualified

auditor such as will enable him to report to the

shareholders as to the trueness and fairness or otherwise

of the balance sheet and profit and loss account or other

financial statement prepared from such books.

TAXATION: Levying by public authorities citizen within

their tax jurisdiction for the purpose of obtaining

compulsory payment to meet the financial social and

economic growth of the authorities.

PLANNING: Deciding upon best future course of action to

follow.
CONTROL: Regulating actions so that it conforms to

plans by effectively appraising the products, activities

and project with which they are concerned.

COST: The level of compensation paid to the owners of

the factors of production to provide them with incentives.

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COSTING: Is the proper allocation of expenditures.
MANAGEMENT ACCOUNTING: Is the application of

professional knowledge and skill in preparation,

presentation and interpretation of the accounting

information in such a way as to assist management in

policy formulation, planning and control in the operation

of all undertaking.
JOB ORDER COSTING: Is a cost system whereby the cost

of each specific product, order (job/batch) is

accumulated separately.
PROCESS COSTING: A cost system whereby cost of

production are assembled by processes or manufacturing

steps to produce a uniform product.

MARGINAL COSTING: The segregation of manufacturing

costs between those which are fixed and those which

vary directly with volume of production.

BREAKEVEN POINT: The point at which sales income

and total cost equates, above which the business makes

a profit below which it makes a loss. It is the point of zero

net income.
BREAKEVEN GRAPH: Is the graph which shows the cost

structure of a business in terms of fixed and variable cost

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and compares this cost with sales income showing profit

or loss at different levels of activities.

INTERNAL CONTROL: This is the whole system of control

financial and otherwise, established by the management

in order to carry on the business of the enterprise in an

orderly and efficient manner, ensure adherence to

management policies, and safeguard the assets and

accuracy of the record.

INTERNAL CHECK: This is the part of internal control

which is exclusively concerned with the prevention and

early detection of fraud and errors.

INTERNAL AUDIT: This is a managerial control system

that functions by measuring and evaluating internal

control system in organization.

MAXIMUM STOCK LEVEL: Is the highest stock level of

which stock is allowed to reach even through usage is

lowest and supplies more frequent.

MINIMUM STOCK LEVEL: Is the level at which stock

must not fall below under normal usage and delivery.

RE-ORDER LEVEL: Is the level of which orders for

replenishment of stock are placed bearing in mind

maximum usage and delivery period.

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1:10 PLAN OF THE STUDY
The study is covered in five chapters, beginning with

chapter one which gives the overview of the topic.

Chapter two covers the literature review. This chapter

gives and in-depth review of the subject matter.

Chapter three covers the research methodology and

sources of data.
While chapter four, covers data presentation and

analysis.

Finally, chapter five provide the summary, conclusion

and recommendations.

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 CHAPTER TWO
1:0 INTRODUCTION
The thrust of this chapter primarily is to provide a

comprehensive review of relevant related literatures on

the subject matter.

It examined what various authorities in the accounting

and related fields has established on the subject matter.

It provides the basic conceptual framework, theories,

principles and techniques that underpin the research

topic.

2:0 ACCONTING AS A TOOL FOR MANAGEMENT

DECISION MAKING
According to Lucey (2002) Decision making is concerned

with making a choice between alternatives and frequently

and important factor in making that choice is the

financial implications of the various alternatives.

Cost accounting is used for both routine and non-routine

analysis e.g. planning and control on one hand or policy

making on the other.

In other words cost and income data available by

Accountants enables management to evaluate divisional

performance, control cost match cost with revenue,

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determine policies and formulate plans directed towards

profitable operations. Thus when and accountant

matches revenue with expenditure, the level of efficiency

is achieved.

Drury (2002) outlines seven steps to be taken in the

decision making process. These are:

1. Identify objectives
2. Search for alternative courses of action
3. Gather data about alternative courses of action
4. Implement the decisions
5. Compare actual and planned outcomes
6. Respond to divergences from plan

The first five stages represent the decision making or the

planning process. Planning involves making choices

between alternatives and is primarily a decision making

activity. The final two stages represent the control

process, which is the process of measuring and

correcting actual performance to ensure that the

alternatives that are chosen and the plans for

implementing them are carried out.

Budget and standards established with their actual cost

of operation and the analysis of variance and profitability

will help the time effort and resources expended on

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costing is aimed at producing greater value to the

business. This is the basis of jurisdiction whereby and

accountant and the management ask whether the cost of

casting a system will yield profit and to what extent. Here

information economy is applied whereby the cost of effort

make in costing a system is weighed against the expected

value to know the worthiness of the system. Employing

cost accounting system into a business will enhance

efficiency and profitability when a manager chooses a

particular system of judging a performance or of

accounting e.t.c, he is confronted with a decision

regarding the cost and value of information that is there

is need for an accountant to save him out by weighing

the relative cost and benefits.

A budget assists manager in managing and controlling

the activities for which they are responsible by comparing

the actual result with the budgeted amounts for different

categories of expenses. Managers can ascertain which

costs do not conform to the original plan and this

requires their attention. The process enables

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management to operate a system of management by

exception Drury (2004). This means that a managers

attention and effort can be concentrated on significant

deviations from the expected results. By investigating the

reasons for the deviations, managers may be able to

identify materials when the reasons for the inefficiencies

have been found appropriate control action should be

taken to remedy the situation.

The cost accounting system monitors the results of

activities and all other control systems. it detailed

analysis and location of all expenditures, the calculation

of job and process costs, the analysis of losses and

scraps, the monitoring of labour and departmental

efficiency and other outputs of the costing system

provided by cost Accountants, management will be able

to plan direct and control operations. Decision making

involves choosing between alternatives. An important

factor in making the choice is the financial implications

of the alternative choice. This mean that accountants

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have to analyse the cost and benefit and weigh the past

is merely an aid in predicting the future events.

A decisions are eased on future costs thus how it can be

controlled. A good cost accounting system therefore

stores information required for decision making thereby

acting as a storage medium to be retrieved when needed.

What to produce? And how to produce? Are questions

asked among others during the planning phase.

Management would like to know what cost will future

events hold so that appropriate plans and decisions can

be made for control. The variance as we can see in due

course revealed by comparison between standards set

and actual performance also called for the need for

control measures.

Ackoff (1981) define planning as a design of a desired

future and of effective ways of bringing it about. In

planning various factors that might directly or indirectly

affect the organization such as at he economic, social,

cultural and technical factors have to be taken into

consideration. Also the competitive activities for the

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established products, assessment of current markets and

distribution policies, possible market development and

product of diversification, resources available, raw

material, skilled labour, all have to be analyse by cost

accountant for a successful planning detailed study or

organizations strength and weakness, its result limitation

e.t.c have to be studied. These would be found favourable

if there are good production facilities and personnel

quality. Planning gives management a sense for direction

for achieving set objectives and improves communication.

Control aims at improving performance of the plan set. It

looks into the extent to which goals of and organization

are achieved and sort for improvement if deficiency is

discovered.

Planning does not make meaning if there is no control for

instance, if N1,000,000.00 is budgeted (planned) for

purchase 2,000,000.00 tones of raw materials and

eventually N10,000,000.00 was spent on some quality if

the management fail to ask for the reasons of the large

unfavourable variance, the implication is that there is no

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control over expenditure over the organization. The effort

and cost f planning becomes a waste. A proper study and

analysis of the cost behaviours by an accountant will aid

management. An accountant separates cost into fixed

and variable for the study of cost volume-profit

relationship.

The techniques for cost volume profit analysis is a

powerful tool for making decision. It allows to evaluate

the effect of selecting a particular volume as planning

based.
2:3 STANDARD COST: A YARD STICK FOR

PERFORMANCE MEASURE
Standard costing as defined by Lucey (2002) is a

technique which establishes predetermined estimates of

the costs of products and services and then compares the

predetermined costs with actual costs as they incurred.

The predetermined costs are known as standard costs

and the difference between the actual cost and standard

cost is broken down into its different elements known as

variance analysis.

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The steps involved in the operations of a standard costing

technique and been set out by Omolehinwa (2006) as

follows:
i. Setting performance target;
ii. Calculating and recording the actual results;
iii. Comparing the actual results with the set

performance standards to obtain a difference

known as the cost variance;

iv. Investigating the causes of the variance in form of

analysis;
v. Reporting the variances to the responsible

officials
vi. Taking action by management where appropriate

including the revision of the standard when

necessary to ensure improved performance in the

future.

Standards are the motivation tools used by

management to improved profitability. Product cost

incurred in a product would make meaning only when

compared with some base data standard. This system

of costing on predetermined basis is due to the fact

that historical cost data does not satisfy the needs for

determining the acceptability f performance.

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 Standard cost is also useful for incremental cost

analysis and n preparing budgets. It can as well help

management to check prices from various managerial

sources. The engineering study enhance determination

of best mix material, level of training work force and

amount of overhead to be incurred. The evaluation of

past performance and prediction of future performance

is aided by standard cost.

The determination of standard costs raises the

problem of how demanding the standards should be.

Should they represent ideal or faultless performance

or should they represent easily attainable

performance? Standards are normally classified into

three broad categories Drury (2004):

i. Basic standard: this is a standard that is dept

constant from year to year as it is designed to

measure the changes that have taken place over

a longer time.
ii. Ideal standard: this is a standard based oh

perfect operating conditions because it gives no

room for inefficiencies.

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 iii. Currently attainable standard: this is the

standard which an employee is expected to meet

provided he can put in a reasonable amount of

effort within the constraints of the operating

conditions.

2:4 VARIANCE ANALYSIS FOR CONTROL

The term variance is not used on its own usually it is

qualified in some way, for example: direct materials cost

variance, direct labour efficiency variance and son on.

The process by which the total difference between

standard and actual costs is sub-divided is known as

variance analysis which can be defined as the evaluation

for performance by means of variances, whose timely

reporting should maximize the opportunity for

managerial action. Lucey (2002).

Variance may be adverse, i.e. where actual cost is

grater than standard, as they may be favorable i.e.

where actual cost is less than standard.

Alternatively they may be known as minus or plus

variances respectively. Variance for each

responsibility center can be identified by each

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 element of cost and analysed according to the price

and quantity content. The accountant assist s

managers by pinpointing where the variances have

arisen and the responsibility managers can

undertake to carry out the appropriate investigation

to identify the reasons for their variance. For

example, the accountant might identify the reasons

for a direct material variance as being excessive

usage of a certain material in a particular process,

but the responsibility center manger must

investigate this process and identify the reasons for

the excessive usage. Such an investigation should

result in appropriate remedial action being taken or

if it is fond that the variance is due to a permanent

change.
The formulae for measuring or calculating variances as

given by Omalehinwa (2006) and Drury (2005) are as

summarized below:
Variance formular model graph

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Actual price Standard price
AP x AQ SP X AQ
PRICE QUANTITY
ACTUAL QUANTITY 1 2

STANDARD QTY 3 4
SQ X AP SQ X SP

KEYS:
SQ = Standard Quantity
AP = Actual price
AQ = Actual quantity
SH = Standard hours
From the above model graph
Quantity variance = Quadrant + 2 Quadrant 4
= (SP X AQ) (SQ X SP)
= SP (AQ SQ)
Price variance = AQ (SP AP)
Labour variance = SP (SH AH)
The variance can be sub-divided into sales and labour.

Damagun (2004)
i. Sales revenue variance
a. Sales price variance = QP (SP AP)
b. Sales quantity variance = SQ(AQ SP)
ii. Material variance
a. Material usage variance = SP(SQ AQ)SP
b. Material price variance = (SP AP) QP
iii. Labour variance

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 a. Labour efficiency variance (measures un hours

instead of quantity = (SH AH) SR

b. Labour rate variance = (SR AR) AH
In both cases, efficiency measures in hours (H) as

quantity while rate measured in Naira (N) as price.

Standard can also be set for overhead activities.

Overhead variances are therefore likely to occur in

calculating overhead variances for management

performance year.
i. Two way variance
ii. Three way variance
iii. Four way variance

Labour efficiency variance = SR (SH AH )

Variable overhead expenditure variance = BVO AVO
Variable overhead efficiency variance = SR (SH AH)
Fixed overhead expenditure variance = BFO AFO
Sales margin price variance = AV(AM SM)
Sales margin volume variance = SM (AV BV)
2:5 CRITERION AND TECHNIQUES FOR CAPITAL

BUDGETING
The variance so far discussed are revealed by and

accountant analysis of standard and actual performance.

Before a business reached this stage, the investment into

it must have been analysed. In this section, we are going

to show how an accountant analysis group o project

investment for management to make decision of which

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among the group to be invested in. thus capital

budgeting focuses on the evaluation and assessment of

investment proposals.
Capital investment decisions are those decision that

involve outlays in return for a stream benefits in future

years. Drury (2004). Capital investment decisions are

part of the capital budgeting process which is concern

with decision making in the following areas.

i. Determining which specific projects a firm should

accept
ii. Determining the total amount of capital

expenditure which the firm should undertake.

iii. Determining how the total amount of capital

expenditure should be finance.

Financial manager tries to maximize the value of finance

by asking himself of the capital expenditure the firm

should embark upon the volume of funds the firm should

invest, how to finance the investment and whether the

firm can maximize profitability, from the existing and

proposed commitment.
This can be stressed or flow chart form as follows
DIAGRAM

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Capital budgeting concern with fixed assets acquisition

and disposal. When an accountant estimated fixed assets

required, he then classify them under appropriate

categories, specific assets should also reject investing in

them.

The process of capital budgeting involves four steps of an

accountant task viz:

i. Project generation: Adding a new product line.
ii. Project evaluation: Estimating the cost and the

benefit of each assets (investment) contemplation

using traditional or modern criterion techniques.

iii. Project selection: At this junction attention must

be given to the capital budget to ensure the

availability of the approved plan of the

organization.
a. Provide a ranking of projects
b. Be applicable to any receivable investment.

Sizer and Motteram (1996)

SELECTION CRITERIA
1. Traditional techniques: These techniques use

subjective approaches. They are following which

could be adopted choosing an investment among a

group.
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 a. Pay Back Period (PBP) or cash recovery period

which it takes an investment project to recover its

original cost. The payback period is calculated by

adding up the cash flows expected in successive

years until the total is equal to the original outlay

Drury (2004). The shorter the PBP the better the

project.
PBP = Cash outflow x year for project with control
Cash inflow x year cash inflow
Accounting Rate of Return (ARR) expresses the

annual average profits arising from a project as a

percentage return on the average investment

required for the project. The accounting rate of

return (also known as the return on investment

and return on capital employed) is calculated by

dividing the average annual profits from a project

into the average investment cost Curry (1990).

Now ARR techniques says that the higher

percentage is preferred. In this case project B will

be accepted by the management and project A

rejected. The traditional criteria is not a good oe

40 | P a g e
 since the techniques conflicts/opposes one

another. Thus pp and ARR are suggesting project

B while the PBP techniques prefer project A. the

businessman can intervene and make judicious

choice of reasonable techniques. An alternative

technique to these is that, a standard

performance may be set so that any project which

performing equal or better is accepted while that

which performs below the standard is rejected.

By these analyses, we can say the accountant

plays a significant role in management decision

making about the project amongst group to

embark upon.

Capital investment decisions are those decision that

involve current outlays in return for a stream of benefits

in future years. Drury (2004). Capital investment

decision are part of the capital budgeting

process, which is concern with decision-making in the

following areas:
1. Determination which specific projects a firm should

accept

41 | P a g e
 2. Determining the total amount of capital expenditure

which the firm should undertake.

3. Determining how the total amount aof capital

expenditure should be finance.

The payback period is calculated by adding up the cash

flows expected in successive years until the total is equal

to the original outlay. Drury (2004)

Accounting rate of return (ARR) expresses the annual

average profits arising from a project as a percentage

return on the average investment required for the project.

The accounting rate of return (also known as the return

on investment and return on capital employed) is

calculated by dividing the average annual profits from a

project into the average investment cost. Curry (1990)

WHY THE PAYBACK AND ARR METHODS ARE WIDELY

USED IN PRACTICE
The payback method is frequently use in practice

because
It is considered useful when firm face liquidity

constraints and require a fast repayment of their

investments

42 | P a g e
 It serves as a simple first-level screening device that

identifies those projects that should be subject to

more rigorous investigations.

It provides a rough measure of risk, based on the

assumption that the longer it takes for a project to

pay for itself, the riskier it is

The ARR is a widely-used financial accounting measure

of managerial and company performance. Therefore,

managers are likely to be interested in how any new

investment contributes to the business units overall

accounting rate of return. Drury (2004).

Surveys conducted by Pike relating to the investment

appraisal techniques by 100 large U.K. companies

between 1975 and 1992 provide an indication of the

changing trends in practice in large U.K companies. Pike

findings relating to the percentage of firms using different

appraisal methods are as follows

1975 1981 1986 1992

% % % %
Payback 73 81 92 94
ARR 51 49 56 50
DCF method
(IRR or NPV) 58 68 84 88
43 | P a g e
IRR 44 57 75 81
NPV 32 39 68 74
Pike (1996)

MODERN TECHNIQUES: This criterion uses objective

techniques for project assessment. It takes care of time

value of money. It stresses the fact that the value of Naira

today is not the sae with last year due to inflation, which

varies value of assets the following and the techniques

used:
Net present value (NPV)
NPV = present values of cash inflow (PVC1)
= ct x1
(k1-k) (1-k)t
Where t cost of is cash outflow
1 = discount factor
(1-k)
K = Cost of Capital
The decision rule used with NPV is to accept project

whose
NPV = > 0 AND reject those with NPV < 0
NPV = PVC1 PVC0

A study of 300 U.K. manufacturing organizations by

Drury et al.(1993) sought to ascertain the extent to which

particular techniques were used. The figures below

indicate the percentage of firms that often or always used

a particular technique:

44 | P a g e
 All Smallest Largest
Organisation Organisation Organisatio
% % %
Payback 63 56 55
(unadjusted)
Disc PBP 42 30 48
ARR 41 35 53
IRR 57 30 85
NPV 43 23 80

More recently a U.K. study by Arnold and HatzoPaulos

(2000) reported that NPV has overtaken IRR as the most

widely use method by larger firms. They reported that

97% of large firms use NPV compared with 84% which

employ IRR.

Few studies have been undertaken in mainland Europe.

The following usage reates relate to surveys undertaken

in the U.S.A and Belgium for comparative purposes Pikes

and U.K study is also listed.

UK USA Belgium
% % %
Payback 94 72 50
ARR 50 65 65
IRR 81 91 77
NPV 74 88 60
Disc PB 65 68

Pike (1996), Trahan and Gitman (1995), Dardenne (1998)

CAPITAL RATINING: These take place in a situation

where the fund available for investments is less than

45 | P a g e
what is required to undertake all available profitable

ventures. That is there is budget ceiling or constrain in

capital rationing both the net present value(NPV) and the

profitability index(PI) are used when the NPV and PI

conflict decision should be taken in favour of the

PI.Okwoli and Kpelai (2008).

INTERNAL RATE OF RETURN (IRR): This gives a rate of

return on projects, which can be compared with the

companys cost of capital to determine acceptance or

rejection of capital investment proposals. Strictly

speaking, it is the rate of interest at which the present

values of expected future cash flows of a particular

project equals its present capital outlays. At this rate of

the discounted cash flow yield, there is no gain and no

loss. It is called time adjusted rate. In a situation of even

or constant cash flow, the flows, the formula for

calculating the discounted cash flow yield or internal rate

of return is
Annual cash flows
Initial investment

46 | P a g e
2:0 RELEVANCE OF AUDIT IN DECISION MAKING FOR

CONTROL
So far we have been focusing on accountant as a

managerial analyst. We shall look at him in this section

as a watch dog that barks and if precaution is not taken

in response to the alarming bark, he goes to bite by

reporting.
This is done by professionally qualified accountant called
Auditor.
The importance of an auditor (accountant) is aiding

management to make decision and control a business

that cannot be over emphasized. The existence and

progress of a business is owed to audit work through

audit fraud is averted, assets are safeguarded

suspiciousness is cleared efficiency is improved and

above all the entire business activities transaction are

controlled. Merchant. (1998).

We shall look at the relevance of audit system to

business progress efficiency and controllability in various

perspectives.

Making a decision by financial leaders like banks on

whether to grant loan will depend entirely on the

47 | P a g e
reliability of debtors (firms) who have to prove by

presenting financial information. This must have been

scrutinized and attested to by independent firm of

professional competent auditors and of high integrity. In

other words, application to banks and other parties for

the purpose of raising funds is greatly enhanced if

supported by audited accounts.

INTERNAL CHECK
As part of internal control, organizations are required to

put in place, what auditors refer to internal checks or

simple checks and balance. By this it means a way of

organizing operation in all sections of an organization in

such a way that no single individual is allowed to initiate

a transaction and concludes every aspect of it alone. For

example, where a particular item of expenditure is to

paid, internal checks should be put in place to ensure

that
i. senior officials approve the application
ii. a payment voucher is raised by a clerk in line

with approval.
iii. If voucher is approved a cheque is written by

different clerk
48 | P a g e
 iv. The cheque is signed by two or more senior

officers who are different from the writer and

v. Cashing or delivery of cheques to payers are done

by the cashier in the most appropriate manner.

It should be noted that checks and balances are

necessary in all areas of operation including stores, sales,

purchases, cash office, salaries production, computer,

e.t.c. through these checks and balances another

individual in the normal course of his duties

automatically checks the work of one individual.

Expectedly, this arrangement not only helps in detecting

fraud an errors bid also deters workers from venturing

fraudulent activities, Damagun (2005)

INTERNAL CONTROL
Control is the process of ensuring that a firms activities

conform to its plan and that its objectives are achieved.

There can be no control without objectives and plans,

since these predetermine and specify the desirable

behavior and set out the procedures that should be

followed by members of the organization to ensure that a

firm is operated in desired manner. Drury (2004)

49 | P a g e
Drucker (1964) distinguishes between controls and

control, controls are measurement and information,

whereas control means direction. In other words,

controls are purely a means to an end; the end is

control. control is the function that makes sure that

actual work is done to fulfill the original intention and

controls are used to provide information to assist in

determining the control action to be taken.

Merchant (1998) distinguishes between strategic control

and management control. Strategic control has and

external focus. The emphasis is and how a firm, given its

strengths and weaknesses and limitations can complete

with other firms in the same industry. While managerial

control system which consists of a collection of control

mechanisms that primarily have an internal focus. The

aim of management control system is to influence

employee behaviors in a desirable ways in order to

increase the probability that an organizations objectives

will be achieved.

50 | P a g e
The institute of chartered accountants in England and

Wales (ICAEW) has defined internal control as not only

internal checks and internal audit but all system of

control both financial and other wise established by the

management of an organization in order to safeguards its

assets and promote operational efficiency.

The auditor ensures that all significant measures, exists

and in high quality. This is certainly for the prosperity of

the business. For internal control to be successful the

authorization custody and recording functions must be

separately performed by different individuals. In addition

operation must be separated in appropriated division and

sub-division each headed by an officer assigned with full

authority and duty fully allocated.

Finally, an auditor ensures that management maintains

efficiency of internal control and minimizing accidental

by ensuring
i. Proper authority of all expenditures.
ii. That internal check is working as designed.
iii. That all transactions are properly recorded.
This form of control is enforced by the following method:

51 | P a g e
 1. STANDARD COST CONTROL: For an auditor to

adopt this technique to obtain the full benefit of a

system which uses standard cost, he must have a

clean idea of what these costs are. Since the main

point in standard consisting is use forplanning,

control, motivation and decision making purposes

without being entered into the books Drury (2004).

However, the incorporation of standard cost into the

cost accounting system greatly simplifies the task of

tracing cost for inventory valuation and saves a

considerable amount of data processing time, for

example, if raw material stocks are value at

standard cost the stock records may be maintained

in terms of physical quantities outlay. Drury (2004)

2. BUDGETARY CONTROL: It is necessary for an

auditor to report on the accounting methods used to

present the actual financial results compared with

these budget and the accuracy of the result. Items

which conform to the examinations of management

accounts a completion re-orientation of auditing

52 | P a g e
 thought is required. The fact that an item has been

adequately vouched is not enough the reason and

justification for expenditure must assume the same

importance as bookkeeping accuracy and adequate

subtraction in budget labour (hours) cost, the auditors

duty is not simply establishing that so much has been

expended on labour on overheads but rather has the

problem of verifying that for every kobo spent the

organization gets an equivalent amount back the

auditors advice in letter of weakness about this

enables management to make decision for controlling

the budget in case variance are figured.

3. ADMINISTRATION CONTROL: This is the control used

by the ministry in checking the accuracy of the clerical

work where the company has costing system run by

separate clerks from those who keep the finance books

the cost accounts should be reconciled with financial

account. The fact that, the same basic information is

recorded by two separate set of employees provides the

auditor with valuable system of control he is complete

53 | P a g e
 without sales and purchase ledger accounts. The

auditor should carefully examine the list of individual

balances on control accounts.

From this, we have seen that auditors help various

aspects of management decision making and control

system set by management. Letter of weakness

(internal control letter) after audit procedure on

internal control. Internal control questionnaire (ICQ) is

designed and completed with officials of the business

through yes/No techniques to verify the strength of the

internal control, internal control evaluation (ICE)

procedure is undertaken to evaluate the truthiness of

the information obtained from ICQ. Based on all these

analysis, the auditor sends a letter of weakness to the

client (management). This letter gives details of the

area in which internal control weakness has been

observed during the result of audit procedures carried

out so far. In other words base of the completed

standard questionnaire by audit staff, the weakness

and deficiencies of internal control and checks are

54 | P a g e
 discussed with responsible officers or communicated

to directors through letter of weakness so that

improved methods can be planned to be introduced

from control. For instance has the receiving cashier

responsibility for or control over debtors ledgers. If yes,

the auditor must ascertain by effective compensation

control. If the cashier can authorize the raising of

invoice to charge out disbursement or, he can create a

journal entry adjusting a debtors account in each of

these there is the possibility that has method may be

used to conceal fraud as he may charge an individual

debtor. The letter of weakness is construct assistance

to management in the form of system

recommendations and advice on maters of financial

management. It aims at bringing to management

attention the weakness in internal control and other

unsatisfactory accounting procedures and practices,

and to suggest remedial action internal audit, this is

the reviewing of operations and records of a business

with a view to see.

55 | P a g e
 i. That the system of operation is followed as

expected
ii. That internal control is as efficient as possible
iii. That economic consistency with efficiency is

applied to the business. The activities of internal

audit section have a direct impact on the scope

and department requirement by the external

audit.

So internal audit compels management to adhere

strictly to the systems internal control procedure and

economics policies to ensure successful operations,

efficiency and consistency

56 | P a g e
 CHAPTER THREE
3:0 RESEARCH METHODOLOGY
3:1 INTRODUCTION
Methodology forms an integral part of any research

work. Methodology implies the system of classification

as it implied by science or art. This research work

primarily aims at X-raying scientifically the impact of

accountants in management decision making,

planning and control.

This chapter attempts to discuss the various ways or

method adopted by this study for data collection and

analysis, the research design as well as research

population and sample.

3:2 RESEARCH DESIGN

Since the subject of research is enormous and I cannot

exhaust it all at this period of my research, the

researcher has employed a social survey in the

research finding, and it will be in an analytical from.

The study primary source of data is the unstructured

oral interview of the staff of Federal Ministry of Interior

Abuja. While the secondary data were obtained from

the records of Federal ministry of Interior viz:

57 | P a g e
 Cashbooks, vote books, ledgers and capital and

recurrent expenditure budgets inclusively.

3:3 POPULATION OF THE STUDY AND

RESEARCH SAMPLE
My representative sample of 200 out of 1520 staff were
selected in a stratified way based on random sampling

technique from the following department of Federal

Ministry of Interior Abuja, viz; Finance & accounts,

Admin & supply, planning research and statistics and

Business department as shown below:

strat populatio propotion probability sample

a n size
senio 220 220/1520 0.14 0.14x200=

r 29

staff
junio 1300 1300/152 .86 .86

r
58 | P a g e
 staff 0 x200=171
Total 1520 1.00 200

3:4 METHOD OF DATA COLLECTION

This study employed unstructured oral interview

complemented with content analysis technique of

inquiring in obtaining the relevant data used for

analysis.
Unstructured oral interview methodology is a technique

in which the researcher asks the respondents series of

question. It involves face to face procedure. This data

collection method was considered, because it provides

the researcher first hand information. Moreover its

flexibility allows the researcher to ask more questions,

thus strengthening the validity and reliability of the

date. Similarly, interview are to a very extend less

costly and time consuming thereby affording the

research opportunity to cover a wide range of sample

size 200 from the population of 1520.

In addition content analysis technique of inquiry was

employed by the researcher to compliment the

59 | P a g e
 unstructured oral interview. Content analysis

technique of data collection is a tool of inquiry that

involve reviewing and analyzing, the existing relevant

records and findings on a subject matter.

3:5 TECHNIQUE OF DATA ANALYSIS

The relevant data sourced through the unstructured

oral interview and content analysis was presented in

chapter four, where simple percentage rating technique

of analysis was employed. As for the research

hypothesis chi-square (X2) statistical technique of

hypothesis was to determine the validity and reliability

of my hypothesis or otherwise.

Chi-square (X2) is represented by the formulae

X2 = (o-e)2
E
Where
X2 = Chi-square

= Summation
O = Observed variable
E = Expected
Expected is represented by the formula
E = TCxTR
GT
Where
E = Expected
TC = Total column of that cell
TR = Total row
60 | P a g e
 GT = Grand total
Degree of freedom is represented by the formulae
DF = (C 1)(R 1)
Where
DF = Degree of freedom
C = No of columns
R = No of Rows
If Chi-square (X2) calculated is greater than the Chi-

square expected at degree of freedom 4 and at 0.05

level of significance, the researcher will reject the

research hypothesis (H1) thereby uphold the Null

hypothesis (H0) or otherwise. The above condition will

guide and enable the researcher to make a valid and

reliable inference.

3:6 SUMMARY
Summarily my representative sample size of 200 from

the population of 1520 were selected in a stratified way

based on random sampling technique from the Federal

Ministry of Interior Abuja. These sample survey aims at

providing estimates of numerical characteristic

(parameters) describing the population in its entirety,

put differently, it aims at obtaining a statistical profile

of the population.

61 | P a g e
 Unstructured oral interview complimented with content

analysis tools of inquiry, were used in obtaining

relevant data for analysis. As for the data collected via

these tools were statistically presented in chapter four

for analysis where simple percentage rating and Chi-

square statistical technique of analysis were employed

to determine the relevance, validity and reliability of the

research findings.

62 | P a g e
 CHAPTER FOUR
4:0 DATA PRESENTATION AND ANALYSIS
4:1 INTRODUCTION
The thrust of this chapter is present the data collected

via the unstructured oral interview and content

analysis for consequent analysis to determine its

relevance, validity and reliability.

To enable the researcher make a valid and reliable

inference a simple percentage rating method was

employed in analysis of the data presented below. As

for the hypotheses Chi-square (X2) statistical technique

of hypothesis testing was employed to determine the

validity and reliability of the research hypothesis or

otherwise.

4:2 RESEARCH QUESTION/HYPOTHESIS

Table 4:1 Sex distribution of respondents

Response Respondents Percentage

Male staff 90 45%
Female staff 110 55%
Total 200 100%
63 | P a g e
 Table 4:2 Age distribution of Respondence

Response Respondents Percentage

20 -30 yrs 20 10%
31 40 yrs 45 22.5%
41 50 yrs 85 42.5%
51 60 yrs 50 25%
61 yrs Nil Nil
Total 200 100%

Table 4:3 Educational Qualification of the

respondents

Response Respondents Percentage

Ssce/Neco/Nabte 15 7.5%

c
ND/NCE 50 25%
HND/BSc 100 50%
Others 35 17.5%
Total 200 100

64 | P a g e
 Table 4:4 Official statuses of Respondents

Top management 65 32.5%

Senior staff 100 50%
Junior staff 35 17.5%
Total 200 100%

Table 4:5 Do your organization have a seasoned

and efficient management

Response Respondents Percentage

Yes 190 95%
No Nil Nil
I dont know 10 5%
Total 200 100%

Table 4:6 Are your organization operational policies

and strategies satisfactory

Response Respondents Percentage

Yes 180 90%
No Nil Nil
I dont know 20 10%

65 | P a g e
 Total 200 100%

Table 4:7 Do you have an effective and efficient

accounting system?

Response Respondents Percentage

Yes 170 85%
No Nil Nil
I dont know 30 15%
Total 200 100%

Table 4:8 Is your accounting department

increasingly part of management decision

making?

Response Respondents Percentage

Yes 190 95%
No Nil Nil
I dont know 10 5%
Total 200 100%

66 | P a g e
 Table 4:9 How do the accounting team aids

management in attaining organizational

goal?

Response Respondents Percentage

By creating a 80 40%

competitive advantage
Providing management 120 60%

with information in

critical decision and

policy making
Total 200 100%

Table 4:10 what are the critical factors impeding the

effectiveness of your accounting

department?

Response Respondents Percentage

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 Inadequate funding 60 30%
Inadequate training 100 50%

and non-

computerization of

accounting processes
Total 200 100%

The tentative statement about the subject mater stands

that:
H1(Research Hypothesis): Accountants have significantly

and increasingly improved management decision making,

planning and control.

H0 (Null hypothesis): Accountants have not significantly

and increasingly improved management decision making,

planning and control.

Table 4:1 Do you agree with the above postulation in

H1?

Strata Agree Disagree Total

Top management 21 0 21
Senior & Junior 155 24 179

staff

68 | P a g e
 Total 176 24 200

If Chi-square (X2) calculated is greater than Chi-square

(X2) expected at degree of freedom (df) 4 and at 0.05 level

of significance, I will reject H1 and accept H0 or

otherwise.

To test the hypothesis the data (responses) in table 4:11

will be used.

Respondents O E O-E (O-E)2 (O-E)2/E

Agreed top mgt 21 18.5 2.5 6.25 0.34
Agreed Snr & Jnr 155 157. -2.5 6.25 0.04
Staff
5
Disagreed top mgt 0 2.5 -2.5 6.25 2.5
Disagreed Snr & 24 21.5 2.5 6.25 0.29

Jnr
Staff
(O-E)2/E 3.17

4:3 DISCUSSIONS OF FINDINGS

69 | P a g e
The analysis of the data in table 4:1 indicates that 90

(45%) of the respondents were male staff while 110 ( 55%)

respondents were female staff.

The table 4:2 shows that 42.5% (85) of the representative

samples are within the age of 41 58 years of age, while

those that fall between the age limits of 51 60 years

closely follow after representing 25% (50) of the

respondents, 22.5% (45) of the respondents are within

the age limit 21 30 years.

The analysis of the data in table 4:3 above reveals that

50% of the respondents are graduates while 25% are

Diploma/NCE holders, 17.5% of the respondents have

other qualifications and 7.5% of the respondents are

certificate holders. This implies that the respondents are

well enlightened academically.

Table 4:4 indicated that 50% of the respondents are

senior staff, 32% are top management and the remaining

17.5% are junior staff.

The analysis of table 4:5 indicates that the management

performs optimally and creditably, 95% of the

70 | P a g e
respondents attested to that fact. This implies that the

organization decision/Policy makers have created the

necessary and sufficient enabling environment that will

accelerate the speedy realization of organizational goal.

In table 4:6 analysis shows that 90% of the respondents

agreed that the organizational operational policies and

strategies are satisfactory. The analysis of the finding is

compatible with the fact in table 4:5. There is a symbiosis

between a sound management team and optimal

attainment of organizational goal.

The data in table 4:7 shows that 85% of the respondents

stated that the organization have a functional and

efficient accounting system while the remaining 15%

have no idea of how effective and efficient is the

accounting system.

Table 4:8 shows that 95% of the respondents said that

accounting department is increasingly part of the

decision and policy making team of the organization. The

foregoing analysis glaringly brought to the fore, the

strategic role, function and relevance of accounting to

71 | P a g e
decision and policy makers. The management of Federal

Ministry of Interior view their accounting system as a

strategic assets of the organization.

The analysis of table 4:9 indicates that 60% of the

respondents are of the opinion that the accounting team

aid in attaining the organizational goal by providing the

management with strategic information in critical

decision making, While 40% of the respondents are of the

view that the accounting teams aids the organization in

their pivotal role by creating competitive advantage. From

the foregoing analysis, the researcher is reasonably

confidence that a sound accounting system is pivotal to

the success of any decision and policy making in an

organization.

The responses in table 4:10 signifies that critical

challenges of the accounting department of Federal

Ministry of Interior are majorly inadequate training and

non-computerization of the accounting processes,

inadequate finding of the department as well as other

exogenous factors.
72 | P a g e
The data table 4:11, Chi-square calculated = 3.17, Chi-

square (X2) expected at degree freedom 4 at 0.05 level of

significance = 9.488.

The researcher accepted the H1 (research hypothesis)

and rejected the H0 (Null hypothesis).

From the foregoing analysis comprehensive and

conclusive empirical evidence abounds that accountants

have significantly and increasingly improved

management decision making, planning and control in

organization.

4:4 SUMMARY
This chapter has scientifically X-ray and evaluates the

symbiotic relationship between an effective accounting

system and management. The study observes that there

is an inextricable nexus between the two. This finding

brought to the fore the role, function and relevance of

accounting in management decision making, planning

and control in organization.

73 | P a g e
 CHAPTER FIVE
5:0 SUMMARY, CONCLUSION AND

RECOMMENDATION
5:1 SUMMARY OF MAJOR FINDINGS
These research study is undertaking in an effort to

provide information on the significant role accountants

play in aiding management make decision. It is in

appreciation of the invaluable and indispensable role,

functions and relevance that accountants play in

organization that provided thee impetus for the

research study.

The study observes that accounting which is often

called the language of business primarily aims at

providing decision/policy maker with useful

information about economic activities. Information

include both recent activities and forecast of the future

to enable management to see expressly the trend of

activities for planning and control. Similarly, these

research work brought to the fore that accounting as

an information system for decision makers, is a vital

managerial tool in todays organization for stirring

74 | P a g e
 operations to the desired direction with competitive

strategy and advantage.

The study observes in its finding that

i. Management view the strategic information

provided by the accountants as invaluable and

indispensable in critical decision making,

planning and control.

ii. Management are of the opinion that accountants

are strategic assets of an organization and hence

are increasingly part of management decision

making.
iii. Accountants significantly aid the speedy

realization of organizational objectives through

empowering management with informed

competitive strategy and expertise.

iv. The accidents use among many other techniques,

standard cost parameters, variance analysis for

control, comparative ration analysis, budget and

monitoring, auditing and internal control in

enhancing management decision making,

planning and control.

5:2 CONCLUSION
75 | P a g e
 An accountant to the management is synonymous to a

fuel to engine or blood to the body. We live in a

dynamic information age; suffice it here to say that

information flow is the life blood of any organization.

These imply that without accountants organization

cannot survive in highly sophisticated and competitive

operations of modern economy. Accountants link

economy events with management. The accountant

oveserves the events encodes and transmit the

information through accounting report (internal or

external) which forms the basic medium of accounting

communication.

Conclusively, form the above foregoing analysis,

findings and inferences, comprehensive and conclusive

empirical evidence abounds that accountants have

significantly and increasingly improved management

decision mailing, planning and control.

5:3 RECOMMENDATION
Knowledge is never static, it rather move in a dialectical

fashion. In light of the present circumstances the

76 | P a g e
 researcher is of the opinion that cost and management

accounting should be dynamic rather than static and

proactive not active, where accountants will take an

innovative approach with reflex-like speed in finding

value added solutions to organizational need rather

than relying on the age long rule of thumb style

The researcher wish to highly recommend that

management in every organization should view

accountants as strategic assets and therefore devote

considerable attention and resources accordingly to

create the necessary and sufficient enabling

environment that will accelerate the role, functions and

relevance. Suffice it here to mention, accountants

should increasingly be part of management decision

making, planning and control.

77 | P a g e