EVALUATION OF ACCOUNTING INFORMATION IN AN ORGANIZATION
CASE STUDY OF GUINNESS NIGERIA PLC)
accounting report consists of items that are contained in the annual report of
a company. These reports are also termed “financial statement”. These reports
are compulsory and necessary in any business; they show the true and fair
position of such company at any given period of time. They are usually on
annual basis and they provided information to the users of the report to give the
judgment about a company. These report include the profit and loss account,
which give the profit of the whole years, before and after tax, or profit to be
retained in the business. They also include the balance sheet, which is a
statement of assets and liability. Included in the financial statement are
of source and application of fund.
year financial summary e.t.c
only the management is interest in the affairs of the company, other groups
like the shareholders are interested in order to be able to measure the
performance of the management and the company, this is done using financial
statement which are accounting reports. Therefore, accounting has been defined
as “The process of identifying to enable it users to make necessary decision
and judgment”. Public company whose shares are quoted in the stock exchange
groups including owners, management, government agencies, employees e.t.c are
interested in the financial statement of a company. The entire group are
interested in the ability of a company to pay its debt as at and when due and
to earn a reasonable amount of income. This dual concepts objective of the
company is referred to as factor of “solvency and profitability”. A company who
fails to meet the standard expected of him by it creditors on a timely basis is
likely to experience difficulty in obtaining credit, which will eventually
leads to a drop in its profitability. Similarly, a company whose earning is
lower than those of its competitors is likely to beat a disadvantage in
obtaining a new capital from stockholders. Accounting reports are therefore of
great importance to any company.
STATEMENT OF THE PROBLEM
study is specifically undertaken to examine the contribution and usefulness of
various accounting report to a public company. It should be noted that
information provided by the various accounting report sometimes might not be
accurate thereby causing a setback in its ability to give an informed judgment.
this end, the study will attempt the examination or evaluation various
instruments used to give interpretation to this accounting reports. In order to
show how solvent it is, therefore it shall examine:-
accounting reports are eventually useful to the public company.
the various information provided there is factual or fallacious
the information has constraints
the user can actually give various interpretations to it and deduce an informed
judgment from it.
the tools used in analyzing actually give good results
1.3 AIMS AND OBJECTIVES OF THE STUDY.
aim of the study is to examine the usefulness of accounting reports, its effect
on a public company and the reasons why it is necessary.
so far on this study have shown the important accounting reports to public
company interms of providing information which will enable the users to give
reasonable judgment on the account of the company.
SIGNIFICANCE OF THE STUDY
study is as much as its attempt to achieve the objective spelt out seeks:-
know the various accounting report used by a public company.
know the extent of its usefulness
know the reports are being evaluated for an informed judgment to be given by
SCOPE OF THE STUDY
focal point of this study is to examine the various accounting reports kept by
the public companies such as Guinness Nigeria plc, highlighting the usefulness
of these reports and their characteristic. The scope of Guinness Nigeria plc.
This due to the fact that it keeps the same accounting record as earlier
stipulated. This study will not deal with anything beyond accounting report and
its usefulness tools used in interpreting these reports will be limited to the barest
minimum. It will be limited to the Lagos office due to the constraint of time
and the distance of other branches of Guinness Nigeria plc in Benin, Aba, e.t.c
PLAN OF THE STUDY
study is aimed at examining the usefulness or to evaluate the usefulness of
accounting report in an organization
vainness Nigeria PLC in particular and the relevance of this report to
users and also show the hole it play in the profitability and solvency in any
financial information for decision making and it users
1.7 DEFINITION OF TERMS
In this study various terms will de
used in order to give a true knowledge of the research work these terms are
EXPENSES;-This are cost which has been
expended in the production of revenue to as an overhead cost.
Balance sheet;- This is the
statement of account which shows the true financial position of the
business entity in giving detailed
summary of the asset and owners equity for a given period.
This is referred
to as the contribution to the shareholders as benefit in a business. It is
stated as specific amount per share of capital stock.
is as an accounting report.
This summarizes the financial
position and operating result of a company
EQUITY;- This is
the amount of owners net investment plus his profit from successful operation
or transaction which has been retained in the business.