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The Need for Accounting Education in Small Scale Enterprises in Nigeria (a Case Study of Uyo Lga)
Content Structure of The Need for Accounting Education in Small Scale Enterprises in Nigeria (a Case Study of Uyo Lga)
- The abstract contains the research problem, the objectives, methodology, results, and recommendations
- Chapter one of this thesis or project materials contains the background to the study, the research problem, the research questions, research objectives, research hypotheses, significance of the study, the scope of the study, organization of the study, and the operational definition of terms.
- Chapter two contains relevant literature on the issue under investigation. The chapter is divided into five parts which are the conceptual review, theoretical review, empirical review, conceptual framework, and gaps in research
- Chapter three contains the research design, study area, population, sample size and sampling technique, validity, reliability, source of data, operationalization of variables, research models, and data analysis method
- Chapter four contains the data analysis and the discussion of the findings
- Chapter five contains the summary of findings, conclusions, recommendations, contributions to knowledge, and recommendations for further studies.
- References: The references are in APA
- Questionnaire.
Chapter One of The Need for Accounting Education in Small Scale Enterprises in Nigeria (a Case Study of Uyo Lga)
INTRODUCTION
Background to the Study
The term an entrepreneur is the one who undertakes to organize, coordinate, manage, and assume all the associated risks of a business. The 18th – century economist, Richard Cantillon, first used the word “entrepreneur” as an economic term (Davis & Gibb, 2007). The term meant an employer who assumes the risk and management of business, in contrast to a capitalist, who merely owns an enterprise and may choose to take no part in its day-to-day operations.
Over time, scholars have defined an entrepreneur in different ways. Kennedy (2009) defined entrepreneur as an economic agent who unites all means of production: land, labour, and capital and thus, produces a product. By selling the product in the market, he pays rent for land, wages to labour, interest on capital and what remains is his profit. He shifts economic resources out of the area of lower use into an area of higher productivity and greater yield. Myra, Patricia, and Candida (2010) indicated that entrepreneurs are innovators who use a process of shattering the status quo of the existing products and services to set up new products and services. Charney and Libecap (2012) defined an entrepreneur as a person who searches for change, responds to it and exploits change as an opportunity. For instance, a quick look at changes in communication medium from typewriter to personal computer, to the internet illustrates this idea. Innovation is no doubt a specific tool of an entrepreneur. Hence, an effective entrepreneur converts a source into a resource.
The economic importance of the entrepreneur to nations has been recognized for several decades. Many authors from different perspectives have discussed the importance of entrepreneurship to different countries. Bhattasali (1981) observed that India owes a lot of credit to her entrepreneurs in the realization of their self-reliant strategy of industrialization which resulted to development and utilization of local raw materials, development of new business ideas, and creation of employment. Owoalah (1989) pointed out that entrepreneurs play many roles in the economy such as contribution to gross domestic product, value added function, and linkage for big companies.
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Also, entrepreneurs are very important in areas such as ultimate utilization of unused raw materials and human resources, meeting of local needs, promotion of initiative, stimulating competition and encouraging good human relationship (Wadhwa & Vivek, 2010). Recently, some economists such as Nicoli and Robert argued that education as well as expansion of high-grade personnel (such as entrepreneurs), rather than the increase of physical capital, is the major means and determinant of economic development (Kayode, 2006). Jones and English (2004) observed that the entrepreneurs play crucial role in the economy through the application of creative ideas in the production of various goods and services which empower the process of economic development. Furthermore, Gibb (2007) stated that entrepreneurs that passed through accounting education apply acquired accounting knowledge to the management of enterprises to achieve business progress and success. Gibb postulates that, to be successful, the entrepreneur should be able to estimate future demand, determine the appropriate quantity and timing of inputs, calculate production costs and determine selling prices, ensure proper documentation of business activities, and also possess the arts of superintending and administration. These are ways of application of accounting knowledge to the entrepreneurial venture.
Nigeria like her counterparts all over the world provides university education to its citizens. The primary challenge of a university is to develop quality human capital for every sector of the national economy (Okafor, 2012). Accounting education is one of the courses being provided in the university. University accounting education was started by the University of Nigeria in 1961 when it opened its door to the very first batch of university undergraduate accounting students in Nigeria (Okafor, 2012). One of the areas of dire need is the production of graduate accountants who are adequately prepared to meet the accounting challenges of modern businesses as well as other economic needs of government. Accounting education incorporates a package of instructional programmes designed to educate prospective accountants to make them efficient and effective in the discharge of accounting duties in any field of endeavour they may find themselves after graduation.
Accounting education was introduced with the aim of achieving numerous goals. One of the goals was to inculcate in the trainees the ability to identify and solve problems using critical and creative thinking (McMullan & Long, 2003). Critical thinking involves logical thinking, reasoning skills such as comparison, sorting, classification, patterning, deductive and inductive reasoning, forecasting, planning, hypothesizing, and critiquing, while creative thinking involves creating something new or original (Busch, 2011). This critical and creative thinking will help to stimulate curiosity and promote divergence in the students. Another goal of the accounting education was to train the students on how to work effectively and cultivate the ability to resolve conflicts and also structure solution to accounting problems. This is because an effective team member goes beyond self and personal desires and goals. He or she recognizes that the immediate challenge is to proffer solution first, thereby, recognizing the benefits of working efficiently, learning to resolve differences as well as maximizing his/her contributions to help the team/group accomplish its purpose (Samovia, 2012). Furthermore, it is equally aimed at educating the students on how to organise and manage their activities. This goal consists of helping students to identify their main activity, break them down into tasks, prioritize them effectively, relate tasks to time and make plan of action (Vesper, 2012). This will go a long way in educating trainees on effective time management, accounting and business planning.
The programme was targeted at equipping students with the skills required for efficient collection, analysis, organisation and critical evaluation of accounting and non-accounting information for effective decision making purposes. Accounting information that is widely used in the business community for decision making includes financial information, management information, and tax information (Deakins & Freel, 2009). The non-accounting information that may be required includes information on employee skills, suppliers, stock out, and equipment failures which equally assist in business decision making.
Moreover, other goals of the accounting education includes to instill in the students the skills and ability to interpret and communicate accounting information effectively, to reflect on experiences and explore strategies for effectiveness and efficiency in any field of endeavour, to become more curious which can lead to readiness to co-ordinate and evaluate financial information, and to consider adequate employment as an accountant as a viable option upon graduation from their institutions (Ulrich & Cole, 2007).
Statement of the Problem
Accounting education seeks to provide students with the knowledge and skills needed to be effective accountants for the benefit of the enterprise they may find themselves upon graduation and for economic growth (Scott, 2012). Given the prevailing business failure rate in Nigeria which currently stands at 52% (Nigerian National Bureau of Statistics, 2012) accounting education has become crucial to enable business sustainability and entrepreneurial success to be achieved since business survival highly depends on effective accountability.
One area of expectation from accounting education is the production of knowledgeable and skilled accountants who will effectively meet the accounting challenges of various businesses as well as economic needs of government. Whereas this is general expectation, there is insignificant basis (if any) to believe that accounting education in Nigeria has impacted significantly on the ability of accountants to structure and provide proper financial management techniques/information for entrepreneurial success in Nigeria (Olajumoke, 2012). There is no basis also to believe that such education has impacted on the performance/success of businesses, hence the rate of business failures in Nigeria (Sola & Gregory, 2009). But, the question is why, in spite of accounting education, companies in Nigeria are still experiencing ineffectiveness in their accounting and financial management activities, as experienced by the former Lever Brothers Nig. Plc. (now Unilever Plc.), the confectionary giant, Cadbury Nigeria Plc., some commercial banks, many small and medium scale businesses (Okafor and Onwumere, 2012). The results obtained by previous researchers on impact of education on business performance are either reporting positive or negative results, thereby showing a contradictory situation. For instance, Bates (1990) research work that was carried out in United State of America revealed that education level is a key determinant of firms’ success, specifying that highly educated entrepreneurs are most likely to create firms that will remain in operation for a longer period of time. On the other hand, Nafziger and Terrell (1996) in their study in India reported that firms founded by first set of entrepreneurs in higher castes are most likely to survive, but that increased education of the founding entrepreneurs reduces survival of the firms. They went further to say that this research finding was supported by the Indio-American Foundation, the National Science Foundation, and Andhra University’s Department of Economics. Moreover, findings from earlier studies do not show the impact of accounting education on entrepreneurial success using turnover and profit as business success determinants. The situation aroused the researcher’s interest in ascertaining the need for accounting education in small scale enterprises in Nigeria by using Uyo Local Government Area as a case study.
Research Objectives
The general objective or main objective of this study is to assess the need for accounting education in small scale enterprises in Nigeria by using Uyo Local Government Area as a case study. The specific objectives are:
i) To examine the impacts of accounting education in small enterprises in Uyo Local Government Area
ii) To investigate the challenges of accounting education in small enterprises Uyo Local Government Area
iii) To study the success level of entrepreneurs that acquired accounting education and their counterparts that did not receive accounting education
Research Questions
The following are some of the questions which this study intends to answer:
i) What are the impacts of accounting education in small enterprises in Uyo Local Government Area?
ii) What are the challenges facing accounting education in small enterprises in Uyo Local Government Area?
iii) What is the success level of entrepreneurs that acquired accounting education and their counterparts that did not receive accounting education?
Research Hypotheses
The followings are the research hypotheses to be tested in this study:
i) There is a significant difference between business success level of entrepreneurs that acquired accounting education and those that do not acquire accounting education.
ii) There is no significant difference in perceived business obstacles between entrepreneurs that acquired accounting education and their counterparts that do not acquire accounting education.
Significance of Study
This study focuses on assess the need for accounting education in small scale enterprises in Nigeria by using Uyo Local Government Area as a case study. Therefore, the policymakers will find it useful in understanding usefulness of accounting education for entrepreneurial success. It will also help government to know the problems that hinders effective entrepreneurship development/success in Nigeria and the need to address the issue for efficient reduction in business failure, and ensure business friendly environment and economic growth. It will help educators to have an insight into business success determinants/variables and their relationship with accounting education. Thus, bringing to light the need to evaluate and enhance accounting education for more effective inculcation of accounting skills on the trainees so as to achieve business sustainability and success. Furthermore, this study will make it possible for the entrepreneurs /business community to assess accounting and financial management skills need, thereby, reducing pre-mature death of businesses and promoting business survival rate for the benefit of the economy. It will also add to the body of literature in relation to the impact of accounting education on business survival, thus serving as a reference material and basis for further research on the related field. Moreover, students as well as researchers will find this work very useful in their quest to know the importance of accounting education for entrepreneurial success/business sustainability.
Scope of the Study
This study focuses on assess the need for accounting education in small scale enterprises in Nigeria by using Uyo Local Government Area as a case study. The choice of the enterprises (small scale industries) was because of the value added function(s) entrepreneurs play in the economy and the need to ensure entrepreneurial success in the Southeast of Nigeria. The sample of this study was restricted to entrepreneurs who are members of National Association of Small Scale Industries (NASSI) in the South-east of Nigeria that registered with Corporate Affairs Commission (CAC). Also, the result of the study could not be generalized for all entrepreneurs in Nigeria due to the fact that data collected represents the effect of accounting education on entrepreneurial success only for entrepreneurs who are members of NASSI and have registered with Corporate Affairs Commission (CAC). Entrepreneurs who are not members of NASSI are not represented and members of NASSI who are not registered with Corporate Affairs Commission (CAC) are equally not represented. Furthermore, the probability sampling design was used because the total population may not be reached within the time limit of the study.
Definition of Terms
The following terms were used during the cause of the study.
Accounting education: Anao (2009) as cited in Okafor (2012) defined accounting education as a field of study that incorporates a package of instructional programmes designed to educate “would be” accountants, to make them versatile and capable to handle effectively any accounting roles they may be called upon to play after graduation. It is also a professional discipline that fortifies the trainees with the basic knowledge and skills to be able to prepare and communicate financial information about the performance of business organisation to information users. This accounting information when properly prepared has specific characteristics which includes reliability, objectivity, understandability, consistency and comparability.
Entrepreneurship: This is an undertaken that involves the task of creating and managing an enterprise for a purpose which may be personal or developmental (Garavan & O’Cinneide, 2004). This task entails planning, organizing, and coordinating activities and resources necessary to manage an enterprise.
Entrepreneurship Education: Entrepreneurship education is a specialized field of study that seeks to prepare the trainees to be responsible enterprising individuals who become entrepreneurial thinkers or entrepreneurs, thereby contribute to business sustenance and economic development. The education does not only base on a textbooks/courses, but students are also immersed in real – life learning experiences where they have an opportunity to take risks, manage the results, and learn from the outcomes (Olajumoke, 2012).
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