FINANCIAL ACCOUNTABILITY, STORES CUSTODY AND CONTROL IN ANAMBRA STATE LOCAL GOVERNMENT SYSTEM (2003 – 2011)

Abstract
Transparency, accountability and probity are principles at the heart of any democracy. These principles strengthen the legitimacy of government, its policies, and decisions in the eyes of the people. Considering the fact that a great deal of money in the local governments is connected to the stores unit, it is necessary to investigate the degree of accountability and control of stores items in the local government in Nigeria. This is essential because the Local government system in Nigeria is facing a lot of problems. The most disturbing of these problems is that the local governments cannot engage in any development project because of lack of funds. The study therefore assessed financial accountability in stores custody and control in Anambra state local government. Specifically, the study was designed to: (i) ascertain the level of knowledge of the guidelines in the Financial Memoranda by staff of local governments in Anambra state; (ii) determine the level of adherence to the guidelines in the Financial Memoranda by the stores officers; (iii) identify the factors militating against financial accountability and effective stores custody and control in Anambra state local governments; (iv) examine and expose means and loop holes through which money is lost in the stores and proffer solutions to poor financial accountability and stores control in Anambra state local governments. Four hypotheses were proposed and tested. A quantitative research design was used for the study. The population for the study was made up of 9,881 staff working in the 21 local governments in the study area. The proportional stratified sampling technique was used to select six out of these 21 local governments. From a total of 2,803 staff working in the sampled local governments, 280 were sampled using purposive random sampling. We relied on self-report technique for data collection in this study. Two instruments were developed for the study, namely, a questionnaire containing structured and unstructured items, and an interview guide. From the 280 staff sampled, four senior staff from each of the six local governments were interviewed. A total of 24 senior staff were interviewed while the remaining 256 staff responded to questionnaire items to generate data for this study. Data collected from the responses to the structured questionnaire were coded into the Statistical Package for the Social Sciences (version 16). The remaining data from the questionnaire, and the whole of the interview responses, were subjected to content analysis to identify emerging themes. Two descriptive statistical tools (mean and standard deviation) were used to analyze the responses from the questionnaire. The results from the analyses were used to answer the four research questions. The four hypotheses were tested at the significance level of 0.05 using Pearson Product Moments Correlation Coefficient (r). The study revealed the following: (i) there is high level of knowledge of the requirements of the Financial Memoranda by the staff of local governments in Anambra State (Mean = 4.24; SD = 0.13); (ii) there is low level of adherence to the provisions in the Financial Memoranda by the financial officers in local governments in Anambra State (Mean = 1.95; SD = 0.23); (iii) the major factor militating against financial accountability and effective stores custody and control in Anambra state local governments is poor internal control system (Grand Mean = 3.49; SD = 0.57); (iv) some of the means and loop holes through which money is lost from the stores are: “poor recording system”, “non-registering of items removed from the store”, and so on (Grand Mean = 3.48; SD = 0.70). The study also indicated that poor financial accountability and stores custody and control in Anambra state local governments can be improved by doing such things as: “adherence to accounting principles such as supervision of workers and proper recording” and “in-service training, workshops and seminars for the workers.” Besides, the stores officers’ adherence to the guidelines in the Financial Memoranda is not dependent on their knowledge of these guidelines (r = -0.488); the poor performance of the officers charged with stores custody and control is not related to their low-level of academic qualification (r = -0.067); the loss of funds observed in stores custody in Anambra state local governments is significantly related to non-adherence to the instructions and guidelines in the financial memoranda (r = 0.354); the level of adherence to the guidelines in the financial memoranda is positively related to the level of accountability of officers charged with stores in Anambra state local governments (r = 0.350); and adherence to accounting principles such as supervision of workers and proper recording will be a path to the realization of financial accountability and stores control.

 

TABLE OF CONTENTS

Content   Page

Title Page……………………………i

Certification Page………………………ii

Approval Page…………………………iii

Dedication …………………………iv

Acknowledgements………………………v

Abstract……………………………vii

Table of Contents………………………viii

List of Figures…………………………xi

List of Tables…………………………xii

CHAPTER 1…………………………1

1.0INTRODUCTION………………………1

1.1Background to the Study…………………1

1.2Statement of the Problem…………………6

1.3Objectives of the Study…………………8

1.4Significance of the Study…………………8

1.5Scope and Limitations of the Study………………9

CHAPTER 2…………………………11

2.0LITERATURE REVIEW AND STUDY AREA…………11

2.1.0 Definitions of Accountability…………………12

(i)Types of Accountability…………………13

(ii) Relationship between Tansparency and Accountability………13

2.1.1 Public Accountability……………………15

2.1.2 Financial Management……………………18

2.1.3 Due Process…………………………21

2.1.4 Stores and Supplies Management According to the 

Financial Memoranda……………………28

2.1.5 Reasons for Holding Stores…………………31

2.1.6 Purchase of Stores………………………33

2.1.7 Factors which make Stores Management Crucial…………36

2.1.8 Stores Building and the Functions of the Officials Responsible 

for Stores Matters………………………38

2.1.8.1 A Simple System of Stores Control……………44

2.1.8.2 The Need for Proper Stock or Stores Control…………46

2.1.9 Gap in Literature………………………49

2.2 Hypotheses…………………………50

2.3 Operational Definitions of Key Concepts………………50

2.4 The Study Area………………………51

CHAPTER 3…………………………62

3.0 METHODOLOGY………………………62

3.1 Method of Study/Research Design…………………62

3.1.1Method and Sources of Data Collection……………62

3.1.2 Population and Sample Size of the Study……………63

3.2.1 Validity and Reliability……………………66

3.2.2 Method of Data Presentation and Analysis……………68

3.3.0 Theoretical Framework……………………69

3.3.1 Application of the Theoretical Framework……………72

CHAPTER 4…………………………75

4.0 DATA PRESENTATION AND ANALYSIS……………75

4.1.1 Data Presentation and Analysis…………………77

CHAPTER 5…………………………87

5.0SUMMARY OF FINDINGS AND DISCUSSION…………87

5.1 Summary of Findings……………………87

5.2 Discussion…………………………91

CHAPTER 6…………………………100

6.0 SUMMARY, RECOMMENDATIONS AND CONCLUSION……100

6.1 Summary…………………………100

6.2 Recommendations………………………103

6.3 Conclusion…………………………104

BIBLIOGRAPHY………………………106

APPENDICES…………………………115

Appendix I (Introductory Letter) …………………115

Appendix II (Questionnaire) ……………………116

Appendix III (Interview Guide) …………………119

Appendix IV (SPSS Printout of Descriptive Statistics: Mean and SD) ……120

Appendix V (SPSS Printout of Test of Hypotheses 

using Pearson Correlation)………………124

Appendix VI (Item-by-item analysis of Hypothesis 1) …………126

Appendix VII (Item-by-item analysis of Hypothesis 2) …………140

Appendix VIII (Item-by-item analysis of Hypothesis 3) …………143

Appendix IX (Item-by-item analysis of Hypothesis 4) …………158

Appendix X (Financial Duties and Responsibilities)……………170 

Appendix XI (Internal Audit Queries and Sanctions)……………183

Appendix XII (Internal Audit and Checks) …  ……………187

Appendix XIII (Some LGT FORMS) ………………....189

Appendix XIV (Stores Receipt and Reject Voucher)………….....194

Appendix XV (Combined Store Requisitions/Store Issue Voucher Form)… ...195