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THE ROLES OF PROFESSIONAL ACCOUNTANTS IN A DEPRESSED ECONOMY (A CASE STUDY OF DELTA STATE MINISTRY OF FINANCE)
The Role of Professional Accountants in a Depressed Economy cannot be overemphasized. However, professional accountant is one of who has passed the qualifying examination of a relevant professional accounting body and has been duly admitted to that body as a member. This project work is carried out to examine the role of accountants in a depressed economy. In the course of the study, the researcher made use of primary and secondary data relevant to the topic in order to achieve the objectives of the study that were analyzed by the means of simple percentage and chi-square test. The rest of the data analysis show that:
- Professional accountants have contributed to the development of business in a depressed economy.
- Accounting reports preferred by professional accountants are in compliance with the rules and regulations guiding the industry.
- A very large extent agreed that the government assist in rebuilding a depressed economy.
- Government establishment agreed to a very large extent that professional accountants have improved accountability. Finally in the course of the study, problems were identified and it was recommended that:
- Professional accountants should be appointed as the head of treasury in any depressed economy. A form of continuous auditing should be ensured by the auditor, so that all reports are independently verified by trained and qualified auditors.
- Annual budget should be set up on the books of the government so that budgetary control can be applied on continuous basis.
1.1 Background of the Study.
Over one half of the 2.5 million professional accountants who are members of the International Federation of Accountants (IFA) work in business organisations. This includes those who work in commerce, industry, public sector, education. Their work, experience and responsibilities are extraordinarily varied, in the role professional accountant’splay in business today.
According to Rahman (2007), the role of accounting profession in a depressed country becomes far more crucial because of a series of problems with which they are burdened, such as lack of resources, heavy borrowing, unplanned investments, and high level of development expenditure and above all lack of accountability. It is therefore the responsibility of the profession to strive hard to provide order in this state of chaos and confusion. They should provide systems, standard, procedures, tools and training to bring about financial discipline, control and accountability at all stages of development expenditure and resources mobilization. In addition, they should also provide method of evaluation, future projection and ability to force and avoid pitfalls in development process.
Equally, the role of accounting profession in involving and lending credibility to financial system has been very critical and so recognised worldwide. A spate of financial arises and corporate scandals in recent years in particular has reinforced the role the profession has play in providing high quality financial information, market discipline and fostering confidence of various stakeholders in the financial market.
Quality of information and integrity of market place, act as a strong medical for brand differentiation, particularly for depressed countries, which compete with each other for mobilization of financial resources, locally and internationally.
However, the role of accounting profession in economic development and confirmed primarily to provision of reliable information. If the accounting profession has to serve public interest in a development context, it should look much beyond and position itself to play a direct and more pro-active role in the formulation of economic policies and guiding implementation thereof.
1.2 Statement of the Problems
There are numerous problems facing the professional accountant in a depressed economy today. However, it is an already known fact that Nigeria is richly endowed with abundant human and natural resources going by the size of its population, the variety of mineral resources such as gas, petroleum, grants, grindstone and iron. They are available in commercial quality. The economic potential has made the country one of the richest in the world if not for the mismanagement of the economy and bad government. The economy would have been better in the world.
The Nigerian economy is indeed mixed and open although it has undergone some considerable changes especially from the 1980s it still remains the consumer economy and a primary producing economy. The agricultural sector which uses to be the major injector of growth and development of the economy has since paved way to the oil sector which has becomes the major source of earning for the country.
To maximize these problems to a manageable level, the government and management should assist or constitute an impact of their accountant towards the attainment of the accounting objectives.
1.3 Objectives of the Study
The objectives of this study are:
1. To examine what a depressed country is all about.
2. To ascertain the factors responsible for a depression in an economy.
3. To ascertain the role professional accountants can play in a depressed country.
1.4 Research Questions
In the course of the study, the following questions were formulated.
- How can professional accountant contribute to the development of business in a depressed country?
- How do we ascertain whether accounting reports prepared by professional accountants are in compliance with the rules and regulations guiding the industry?
- In what way, can government rebuild depressed economy?
- How can professional accountant improve accountability?
1.5 Significance of the Study
The study will be of immense benefit to government, bankers, accountants, researchers as well as students particularly those in the department of accountancy, banking and finance and business studies.
The outputs of this study work will also serve as a base for literature review for researchers, in future on related or similar topic.
The government and policy makers will also benefit from this study in that it will help them to make proper decision as to the growth and development of the economy.
1.6 Scope of the Study
This work was carried out to examine the role of professional accountant in a depressed economy. The study in terms of its geographical coverage was limited to Delta State, Nigeria.
1.7 Limitation of the Study
A study of this nature cannot be carried out without difficulties in the process. Below are the major constraints of the study.
- Time: The research was carried out with other class work and the research was compelled to complete the work within a short period of time considering the broad nature of this study.
- Sources of Data: There was difficulty in sourcing for data relevant to the study. The respondent are not co-operative, many feels very reluctant in releasing needed book which have enhanced the quality of the research work.
- Finance: A research of this nature involves travelling from one place to another to gather data. And this involves huge amount of money.
1.8 Definition of Terms
- Profession: This is a work that requires special training.
- Professional Accountant: This is defined as that individual who has passed the qualifying examination of a relevant professional accountancy body and has been duly admitted to that body as a member.
- Depressed Economy: This is the period of low general economic activities marked by mass unemployment, deflation, decreasing use of resources and low level of investment.