Effects of Financial Accounting Reporting on Managerial Decision Making
CHAPTER ONE
Objective Of The Study
The research work covers the effect of financial accounting reporting on managerial decision making. The studies have the following objectives:
- To know whether the various ways of presenting financial accounting reporting have any effect on managerial decision making in the company.
- To examine the attitude of management in the allocation of resources which often leads to achievement of profit maximization objective.
- To determine the level of which management recruit trained and professional personnel which leads to quality decision making.
CHAPTER TWO
LITERATURE REVIEW
CONCEPTUAL REVIEW
Accounting information is the key component in most, if not all, management decisions of an enterprise. Every year, business decisions worth billions of dollars are made. What is missing in most decisions is the quality component.
WHAT IS ACCOUNTING?
Mbanefo, (1997) defines accounting as a measurement and communication system to provide economic and social information about an identifiable entity to permit users to make informed judgements and decisions leading to an optimum allocation of resources and the accomplishment of the organizations objectives.
According to Fess and Niswonger, accounting is the process of identifying, measuring and communicating economic information to permit informed judgments and decisions by users of the information.
The purpose is to help people that use this information to make more informed decisions.
WHAT IS ACCOUNTING INFORMATION SYSTEM?
According to Wikipedia, AIS is a system of collecting, storing and processing financial and accounting data that are used by decision makers.
According to Lallo and Selamat (2014) and saira et al. (2010), they define AIS as a system that processes data and transactions to provide users with information they need in order to plan, control and operate businesss.
WHAT IS ACCOUNTING INFORMATION?
According to Wikipedia, Accounting information is the data that have been processed properly to give a full meaning and can be used in ongoing operations and future decision-making.
Accounting information: all quantitative and non-quantitative information that concern with the economic events that are processed and reported by information system in the financial statements that presented to external and internal users.
CHAPTER THREE
RESEARCH METHODOLOGY
This chapter describes the statistical methods used in analyzing the data obtained during the course of this study and the relevant interpretation for the statistical output, and this interpretation was used to determine the nature of relationship that exist between the dependent and independent variables. The variables considered by this study are accounting information and management decision making process. which were represented by qualitative characteristics of accounting information.
This chapter comprises of the research design, study variable, population of the study, sampling techniques, sample size, sources of data, method of data collection, study variables, method of data analysis and model specification.
CHAPTER FOUR
FINDINGS, PRESENTATION AND DISCUSSION
This chapter presents the analysis of answers to the questions in the questionnaires administered to the respondents. The use of table and charts will be adopted to clearly show the responses obtained in each question of the questionnaires and the research hypothesis from chapter one will be used to test hypothesis guiding the study through the use of percentages and fit of the model, Analysis of Variance (ANOVA) and Regression of Coefficients.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
INTRODUCTION
The chapter gives a summary with major findings aligned to the objectives. A conclusion on the relationship between the study variables was deduced in line with the objectives. Suggestions for recommendations and area for further studies.
SUMMARY
The study general objective was to study the effect of accounting information on decision making in Nigeria Bottling Company PLC.
The first objective was to study is to determine whether the various ways of presenting financial accounting reporting have any effect on managerial decision making in NBC PLC. Results indicated that reliability was important in determining decision making in Nigeria Bottling Company PLC. This was supported by majority of the respondents who strongly agreed that that information generated from accounting systems displayed an element of completeness, Accounting information are verifiable and this is key in the decision making process and agreed that financial information was faithfully represented.
According to correlation results, there was a strong, positive and statistically significant association between reliability and decision making. There is also a positive relationship between reliability and decision making in Nigeria Bottling Company PLC according to the regression results.
Conclusions
From the study findings, it can be concluded that accounting information reliability as a characteristic on accounting information used by management in decision making in NBC PLC was verifiable, financial information was faithfully represented and had an element of completeness. It can further be concluded that accounting information in NBC PLC Enugu state was characterized by reliability and this reliability was a key predictor of decision making in NBC PLC.
It can also be concluded that accounting information comparability as a characteristic depended on whether financial statements of one accounting period are comparable to another, whether financial information made it easier for users to choose between alternatives and whether the Users of accounting information are able to compare financial reports generated in different periods. Further, accounting information in NBC PLC Enugu state had adequate comparability characteristics and this comparability was a key determinant of decision making in NBC PLC.
Recommendations
Through this study the researcher recommended the following specific task as a way of insuring that accounting information is important in management to make decisions.
- From the study findings, the researcher recommends that the management puts in measures to improve both quantitative and qualitative characteristics of financial statements so that they are easily comparable to other industries.
- All systems have to be computerized and modern speed system network should be established so that the information could reach the accounting department on time. The management should also train its workers on the accounting package for quick and efficient accounting records
- The management should ensure that all staff in the administrative and finance department is well trained. Sufficient funds should be set aside to provide for staff training in order to Increase their skills in comparing financial reports. The staff in accounting department must be a holder of any professional degree such as Advanced Diploma, Degree, Masters and Certified Public Accountant (CPA).
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