Improper accounting system: a cause of non-performance in industries

Project Abstract

The accounting system plays a crucial role in the performance of industries. A well-functioning accounting system ensures accurate financial reporting, effective cost control, and strategic decision-making. However, when an accounting system is improperly designed or implemented, it can lead to significant issues that hamper the performance of industries. This research explores the impact of improper accounting systems on the non-performance of industries. The study investigates the common causes of improper accounting systems in industries, such as inadequate training of accounting personnel, lack of proper internal controls, and outdated accounting software. These factors can result in errors in financial reporting, mismanagement of financial resources, and ineffective monitoring of key performance indicators. As a consequence, industries may experience financial losses, reduced competitiveness, and even regulatory compliance issues. Furthermore, the research delves into the specific ways in which improper accounting systems contribute to non-performance in industries. For instance, inaccurate financial reporting can lead to incorrect decision-making by management, resulting in misguided investments or cost-cutting measures. Inadequate cost control due to poor accounting systems can lead to budget overruns, reduced profitability, and ultimately, financial distress for the industry. Moreover, the study highlights the importance of implementing proper accounting system controls and procedures to mitigate the risks associated with improper accounting systems. By establishing robust internal controls, providing adequate training to accounting staff, and investing in modern accounting technology, industries can enhance their financial reporting accuracy, cost efficiency, and overall performance. In conclusion, this research emphasizes the critical role of accounting systems in the performance of industries. Improperly designed or implemented accounting systems can have detrimental effects on financial management, decision-making, and overall industry performance. By addressing the root causes of improper accounting systems and implementing best practices in accounting system design and management, industries can improve their financial health, competitiveness, and long-term sustainability.

Project Overview

<p> </p><p>1.0 &nbsp; &nbsp; &nbsp; <strong>INTRODUCTION</strong></p><p>Any organization, manufacturing or non-manufacturing that knows its owns requires an effective accounting system for its continuous existence. We have in the post head of firms that folded up due to one reason or the other. When properly investigated as to what brought about its folding up, one may not be surprised that it was due to negligence in operating an affective accounting system.</p><p>Every manufacturing / non-manufacturing industry needs an effective proper accounting system to determine industry needs on effective proper accounting system to determine the profitability position at least to break even. The shoreholder is interested in seeing his invested funds, yielding returns. The creditors want to be sure that his money lent to the company is not squandered. Also the tax authority relies on this system to asses such company’s tax liabilities.</p><p>1.1 &nbsp; &nbsp; &nbsp; <strong>OBJECTIVE OF THE STUDY</strong></p><p>The write-up tends to achieve the following objectives:</p><p>· &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; To ascertain, assess and evaluate how improper accounting system affects the performance or industries.</p><p>· &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; To examine the extent to which accounting system can supply management with much needed information for decision making.</p><p>· &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; Finally, and most important objective, is to determine how improper accounting system could lead to non-performance in industries by examining the benefits of proper accounting system as a whole.</p><p>1.2 &nbsp; &nbsp; &nbsp; <strong>SIGNIFICANCE OF THE STUDY</strong></p><p>With this study, players in the industrial sector or an economy will understand how keeping an improper accounting system could lead not only to the non-performance of such an industry but to the adverse effect of winding up of that industry.</p><p>&nbsp;</p><p>The study will also be useful to management consultant, creditors, shareholders, tax authorities and even government. Also to the writer who aspires to become a prolessmal, the research work undertaking by him will enable him have a foresight of what is to come.</p><p>&nbsp;</p><p>Finally, to any other student who might want to research in something similar, this work will be of useful importance.</p><p>1.3 &nbsp; &nbsp; &nbsp; <strong>RESEARCH QUESTIONS</strong></p><p>In order to carry out a proper research of this nature, question must be answered. Such question includes:</p><p>· &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; Does proper accounting system in an industry or organization affect its chances of making profit?</p><p>· &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; Is proper accounting system necessary for effective operation hence the performance of an organization?</p><p>· &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; Finally, what impact does a proper accounting system have on any organistion?</p><p>1.4 &nbsp; &nbsp; &nbsp; <strong>DEFINITION OF TERMS</strong></p><p>FOLD UP /WIND UP: The closure of a firm due to mis-management of its fund or poor sales.</p><p>BREAK EVEN: This is also known as Break-even point. It is the poor at which total revenue equals the total expenses. At this point the firm make neither profit or loss.</p><p>SHAREHOLDER: These are owners of shares in a company.</p><p>FUND: A sum of money made available or saved for a particular purpose.</p><p>CREDITOR: A person / company to whom money is owned.</p><p>SYSTEM: A group of things working together as a whole.</p><p>TAX: This is a compulsory levy on incomes of individuals, companies and property charged by government.</p> <br><p></p>