Saturday, 4 February 2017
FINAL YEAR PROJECTS: IMPACT OF TREASURY SINGLE ACCOUNT (TSA) IMPLEMENTA...
FINAL YEAR PROJECTS: IMPACT OF TREASURY SINGLE ACCOUNT (TSA) IMPLEMENTA...: CHAPTER ONE INTRODUCTION 1.1 Background of the study ...
Monday, 23 January 2017
THE IMPACT OF LIQUIDITY MANAGEMENT ON THE PROFITABILITY OF A MANUFACTURING COMPANY (A CASE STUDY OF NIGER MILL PLC, CALABAR)
CHAPTER
ONE
1.1
Background of the study
Liquidity management is a concept that
is receiving serious attention all over the world especially with the current
financial situations and the state of the world economy. The concern of
business owners and managers all over the world is to devise a strategy of
managing their day to day operations in order to meet their obligations as they
fall due and increase profitability and shareholder’s wealth. Liquidity
management, in most cases, are considered from the perspective of working
capital management as most of the indices used for measuring corporate
liquidity are a function of the components of
working capital. The importance of liquidity management as it affects
corporate profitability in today’s business cannot be over emphasis.
The notion of liquidity in the
economic relates to the ability of an economic agent to exchange his or her
existing wealth for goods and services or for other assets. In this definition,
two issues should be noted. First, liquidity can be understood in terms of ‡owes
(as opposed to stocks), in other words, it is a ‡own concept. In this framework,
liquidity refers to the ability of an institution or organization to meet
demands for funds. Liquidity management means ensuring that the institution maintains
sufficient cash and liquid assets to satisfy client demand for goods and services,
and to pay the institution’s expenses. Liquidity management involves a daily
analysis and detailed estimation of the size and timing of cash inflows and
outflows over the coming days and weeks to minimize the risk that savers will
be unable to access their deposits in the moments they demand them. Liquidity
and its management determines to a great extent the growth and profitability of
a firm. This is because either
inadequate liquidity or
excess liquidity may
be injurious to
the smooth operations
of the organization. This
seeming controversy has
attracted a lot
of interest in
the subject of
liquidity management. The primary
aim of this research work is to investigate the relationship between liquidity
and profitability.
Manufacturing sector plays a
crucial role in modern economy and has many dynamic benefits for economic
transformation. In a typical economy, the manufacturing sector is a leading
sector in many respects. It is an avenue for increasing productivity related to
import replacement and export expansion, creating foreign exchange earning
capacity; and raising employment and per capital income which causes unique
consumption patterns. Furthermore, it creates investment capital at a faster
rate than any other sector of the economy while promoting wider and more
effective linkages among different sectors. In terms of contribution to the
Gross Domestic product, the manufacturing sector is dominant but it has been
overtaken by the services sector in a number of Organizations for Economic
Co-operation and Development (OECD) Countries.
Before independence,
agricultural products dominated Nigeria’s economy and accounted for the major
share of its foreign exchange earnings. Initially, inadequate capital
investment permitted only modest expansion of manufacturing activities. Early
efforts in the manufacturing sector were oriented towards the adoption of an
import substitution strategy in which light industry and assembly related
manufacturing ventures were embarked upon by the formal trading companies. Up
to about 1970, the prime mover in manufacturing activities was the private
sector which established some agro-based light manufacturing units such as
vegetable oil extraction plants, turneries tobacco processing, textiles,
beverages and petroleum products. The strategy of light and assemblage
manufacturing shifted somewhat to heavy Industries from the period of the third
National Development plan (1975-1980) when government intervened to establish
care industrial plants to provide basic imports for the downstream industries. The
import dependent industrialization strategy virtually came to a halt in the
Late 1970s and early 1980s when the liberal impart policy expanded the imports
of finished goods to the detriment of domestic production. In this regard,
industrialization constitutes a veritable channel of attaining the lofty and
desirable conception and goals of improved quality of life for the populace.
However, liquidity has an important relationship
with profitability in the manufacturing industry. If companies have enough liquid resources, it
may be able to get benefit of cash discount on purchases and consequently that
will result in increasing profits.
If they cannot
pay the creditors
for goods in
the given period, they have to pay interest on the
amount of purchases. Thus, shortage of liquid resources will result
in low of
cash discount and
payment of interest.
Both the losses will certainly decrease over profits. Secondly,
companies may keep
the stock at
desired manners and
that will benefit them
in circulation of
business activities. Contrary
to this, if
they are not
able to keep sufficient stock
due to shortage
of liquid resources,
then the production
cycle may not continued and that will result in heavy
losses. Liquid resources of a business concern for all over to expand huge
business activities more, and less in financial.
Again, the management of cash
resource is also an important concept in liquidity management. In this context the objectives of a firm can
be unified as bringing about consistency between maximum possible profitability
and liquidity of a firm. Cash
management may be defined as
the ability of a management
in recognizing the problems related with cash which may come across in future
course of action, finding appropriate solution to curb such problems if they
arise, and finally delegating these solutions
to the competent
authority for carrying
them out The
choice between liquidity and profitability creates a state of confusion.
It is cash management that can provide solution to this dilemma. Cash
management may be regarded as an art that assists in establishing equilibrium
between liquidity and profitability to ensure undisturbed functioning of a firm
towards attaining its business objectives. Profitability is a measure of the amount by
which a company's revenues exceeds its relevant expenses. Profitability ratios
are used to evaluate the management's ability to create earnings from
revenue-generating bases within the organization.
1.2
Statement of the problem
Business financing, especially at
the wake of the 2008 financial crisis, which has become a major source of
concern for business managers as bank loans are becoming too expensive to
maintain as a result of tightening of the local financial market and the reluctance
of the public to invest in the share of companies sequel to the crash of the
capital market. These situations compel business managers to device various
strategies of managing internally generated revenue to enhance their chances of
making profit and meeting existing shareholders expectations.
THE COMPLETE PROJECT IS CHAPTER 1-5
#4000 ONLY
PAYMENT PROCEDURE;
BANK: FIRST BANK
ACCOUNT NAME:
EGBE JOHN EDOGI
ACT NO: 3034851408
GTBANK
ACCOUNT NAME:
EGBE JOHN EDOGI
ACT NO: 0122005571
Please after payment send the teller
number and your name the way it appear in the teller to any of the following
phone number:
08037940241
08183133884
egbe4u@gmail.com
You will receive your material in your email box within 24 hours after
payment. Thanks for doing business with us.
IMPACT OF TREASURY SINGLE ACCOUNT (TSA) IMPLEMENTATION ON GOVERNMENT FISCAL OPERATION IN NIGERIA (A STUDY OF MINISTRY OF FINANCE CROSS RIVER AND AKWA IBOM STATES)
CHAPTER ONE
INTRODUCTION
1.1 Background of the
study
The
introduction of Treasury Single Account is as a result of numerous corrupt
practices that exist in the Country’s public accounting system. This was as
result of lack of transparency and accountability in the management of public
funds. Treasury Single Account (TSA) is one of the financial policies
implemented by the federal government of Nigeria to consolidate all the revenue
from all the ministries, departments, and agencies (MDAs) in the country by way
of deposit into Commercial banks traceable into a single account at the Central
Bank of the country. They are critical for ensuring that all tax and non-tax
revenues are collected and payments are made correctly in a timely manner; and
government cash balances are optimally managed to reduce borrowing costs (or to
maximize returns on surplus cash). This is achieved by establishing a consolidated
government bank accounts via a treasury single account (TSA). Treasury single
account (TSA) is a prerequisite for modern cash management and is an effective
tool for the ministry of finance/treasury to establish oversight and
centralized control over government’s cash resources (Adeyemo and
Salami, (2008). It provides a number of other benefits and thereby enhances the overall
effectiveness of a public financial management (PFM) system.
Treasury
single account (TSA) also facilitates debt management, and monetary policy
coordination as well as reconciliation of banking data, which in turn improves
the quality of fiscal information (Aluko, 2008). Treasury Single Account (TSA) is one
of the proven practices in improving the payment and revenue collection
systems, and carrying out consistent control of public expenditures by
centralizing the free balances of government bank accounts. The TSA
infrastructure is usually implemented as a part of the Financial Management
Information System (FMIS) solutions. In other words, treasury single account
(TSA) is a bank account or a set of linked bank accounts through which the
government transacts all its receipts and payments and gets a consolidated view
of its cash position at the end of each day.
However,
fiscal operations are actions taken by the government to implement budgetary
policies, such as revenue and expenditure measures, as well as issuance of
public debt instruments and public debt management. Fiscal operations include
accounting and financial reporting, cash management, investments, accounts
payable, payroll, fixed assets, internal control, and debt service management.
This includes maintaining the general ledger and all subsidiary ledgers,
preparation of required reconciliations, ensuring compliance with the annual
budget ordinance, reporting to State and Federal agencies, updating the Capital
Improvements Plan and preparation of the annual operating budget.
The
Office of Fiscal Service is to develop policy and operate the financial
infrastructure of the federal government, including payments, collections, cash
management, financing, central accounting, and delinquent debt collection. They
provides policy oversight of the bureaus under it and develops policy on
payments, collections, debt financing operations, electronic commerce,
government wide accounting, government investment fund management, and other
issues. The office also performs two critical functions for the department: it
manages the daily cash position of the government and it produces the cash and
debt forecasts used to determine the size and timing of the government's
financing operations. Fiscal Operations and Policy, oversees the development
and implementation of policies relating to the government's cash management
operations, investment and administration of trust funds, payments,
collections, and debt collections.
Therefore, treasury single account (TSA)
is an essential tool for consolidating and managing governments’ cash
resources, thus minimizing borrowing costs. Considering Nigeria as a country
with fragmented government banking arrangements, the establishment of a TSA
should receive priority in the public financial management reform agenda as
well as meeting the preconditions and desirable sequencing for its successful implementation.
From the foregoing, it is obvious that the primary objective of a TSA is to
ensure effective aggregate control over government cash balances. It avoids
borrowing and paying additional interest charges to finance the expenditures of
some agencies while other agencies keep idle balances in their bank accounts.
There were situations where some MDA’s manage their finances like independent
empire and remit limited revenue to government treasuries. Under a properly run
TSA, this is not possible as agencies of government are meant to spend in line
with duly approved budget provisions. The maintenance of a single account for
government will enable the Ministry of Finance monitor fund flow as no agency
of government is allowed to maintain any operational bank account outside the
oversight of the ministry of finance. The full implementation of this programme
therefore is a critical step towards eradicating corruption and other financial
irregularities ravaging the country. Therefore by introducing economy and
efficiency in the management of scarce public resources, the Government is in a
better position to realize its policy goals
1.2 Statement of the
problem
A
country with fragmented government banking arrangements that lack effective
control over its resources can pay for its institutional deficiencies in
multiple ways. First, idle cash balances in bank accounts often fail to earn returned
on capital. Secondly, the government, being unaware of these resources, incurs
unnecessary transactions and borrowing costs in raising funds to cover a
perceived cash shortage. Thirdly, delay in executing government budgets and
projects as a result of lack of funds in Government account. The problem of financial leakages,
increase in corruption, lack of transparency and accountability are also major
concerned. The researcher, therefore want to examine how treasury single account
(TSA) implementation on government fiscal operation can significantly
eliminate or reduces the above mentioned problems.
THE COMPLETE PROJECT IS CHAPTER 1-5
#5000 ONLY
PAYMENT PROCEDURE;
BANK: FIRST BANK
ACCOUNT NAME:
EGBE JOHN EDOGI
ACT NO: 3034851408
GTBANK
ACCOUNT NAME:
EGBE JOHN EDOGI
ACT NO: 0122005571
Please after payment send the teller
number and your name the way it appear in the teller to any of the following
phone number:
08037940241
08183133884
egbe4u@gmail.com
You will receive your material in your email box within 24 hours after
payment. Thanks for doing business with us.
Subscribe to:
Posts (Atom)