USERS OF GOVERNMENT ACCOUNTING INFORMATION IN NIGERIA
The
users of government accounting information in Nigeria
are constantly question the rationale behind having a robust accounting
information system in the Nigerian government parastatal when not even a single
rule contained in the various government gazettes are adhered as far as
handling government accounting in Nigeria is concerned. This article is not
written with the aim of pointing accusing fingers on anyone but to identify the
users of government accounting information from the Nigerian government.
WHO
USES GOVERNMENT ACCOUNTING INFORMATION AND HOW?
This section of this
article will deal with the general users of accounting information. There are
two broad categories of people that use accounting information; the internal
users and the external users. The external users of accounting information by
definition are those group of people that are one way or the other affected by
government accounting statements but does not have influence over how it is
prepared and distributed, while the inside users of accounting information are
people that have some degree of control over the process of manipulating the
figures in government accounting. For the purpose of this writing on users of
accounting information, no attempt will be made to separate the users into the
insiders and outsiders. Those that are interested in accounting information of
a government are:
FOURTEEN
(14) USERS OF ACCOUNTING INFORMATION
Please
note that the order of these users does not by any means indicate the degree of
importance that they attach to accounting information.
GOVERNMENT
Government through her
various agencies make use of accounting information to plan and govern the
states. Tax authorities for instance, to a great extent rely on the accounting
information as contained in the financial statements of an entity to determine
the taxable income of an organization.
SHAREHOLDERS
Shareholders being the
owners of an entity have vested interest in financial statement of where their
interest is. They need accounting information so as to make an investment
related decision. It is through the financial statements that the shareholders
of an institution can make a decision of whether to buy more shares, retain
what they already have, or divest.
POTENTIAL INVESTORS
People that want to invest
in a company look through their financial statement with the hope of getting
relevant accounting information so as to make an informed economic decision. Although
all the vital information that they need cannot be found in the published
accounts, a good insight is obtained.
LENDERS
You don’t expect someone
to give money to another and fold his or her hands without monitoring how the
money is being utilised. They analyse the accounting information to have an
idea of what financial status the organization that is having their money is
in.
SUPPLIERS
Suppliers look into the
finance of their customer to reassure themselves that they are dealing with an
entity that is financially healthy. This is usually the case when there is a
credit transaction involved.
CUSTOMERS
The fear of buying goods
and services from a source that will not be around in the future makes customer
analyse the accounts of their prospective supplier. As a customer, you might
have the feeling that there will be a need for further service for the product
you get from your suppliers.
TRADE UNION | STUDENT
UNION GOVERNMENT | NGOS | SOCIAL CLUBS
The interest of trade
union in the accounting information of a company lays in the fact that they pay
lots of solidarity visits. When they see a company or an entity that is making
waves financially, they will try and establish a rapport with the aim of
getting one favour or the other.
CHURCHES
Churches have similar
interest with the above collective groups of not for profit organization of
people. The main reason why churches take time to look at the financial
statement of a company or to listen to financial news is to get information
about who to ask for money when organizing a program or helping the needy. There
is no argument, most leaders in the
church do engage in one form of misappropriation or the other.
COMPETITORS
Competitors of an entity
try analysing the accounting numbers of the company with the hope of getting a
clear picture of how the competing business manages his or her finance.
STATISTICS OFFICE
Without keeping relatively
accurate and complete record, no economy will grow or move forward- take Nigeria
as an example, the absence of record keeping of all kind made it almost
impossible for any meaningful project to yield fruit. Major economic activities
are hinged on the quality of accounting information that can be garnered for
that project. Accounting information comes in handy in this regard.
EMPLOYEES
The main reasons why
employees pay attention to accounting information of a company are in relation
to salaries and prestige. If they are not hoping to clamour for a pay rise,
they will be bragging with their pals.
CREDIT AND EQUITY ANALYSTS
Credit and equity analysts
tears down accounting information, mix it up with other economic information so
as to make valuation decisions. They analyse the content of a company’s annual
report so that they can provide their client with the highest quality of
information.
ACCOUNTING STANDARD SETTERS
The accounting standard setters through their various agencies pay close attention to the way accounting statements are prepared. Nigerian Accounting Standards Board (NASB) is an example of an accounting standard board.
MANAGEMENT
The management of any
going concern as the insider uses accounting information to make informed
economic decision that either make or mare a company. Management rely on
management accounting for making managerial tough decisions.
EXPERT WITNESSES
Expert witness in a good
number of court cases have turned to accounting information for evidence that
acts as a deciding factor in a case. Being trained in financial statement
frauds, expert witnesses easily read financial and accounting information
between the lines.
Since Nigeria is a society
that is made up of people, the users of accounting information in Nigeria is to
a large extent same as that of other countries of the world. A distant cousin
of mine asked me a question that prompted me to write this article. He asked, ‘who are the users of government accounting
information in Nigeria?’ I simply told him that there is no difference
between Nigeria and the rest of the world. So if you asked similar question,
all the contents of this page provides an answer to your question, digest them
with rapt attention.