CHAPTER ONE

INTRODUCTION

1.1   Background of the Study

An accountant is an independent practitioner who works on a gee basis for business management or for individuals wishing to use his services or as member of an accounting firm. Most public accountants are also external authors.

• Those that are substantially of auditing nature
• Those who involve primarily accounting
• Those pertaining to taxes.

Most people perceive the roles of an accountant as being limited to the traditional one balance sheet in the process of auditing the financial statements of companies.

The have failed to realize and appreciate that an accountants provides services in respect of problems relating to conceptualization of business ideas, formation, registration and development of business most importantly on how to do with the collection and presentation of accounting data. They also undertake routine book-keeping for enterprises without adequate book-keeping personnel.

Very often, the accountant is consulted with respect to income tax implication of proactive transactions. In his contribution, Okugi said consultant of his client, the task will be more cost effective and efficient. Hence, he will be able to make comprehensive report to avoid as much tax as possible and avoid unnecessary duplication. 

C.A. Okafor saw the designing of accounting systems for clients as one of the frequently ignored aspects of public accounts in Nigeria.

An accountant helps in the planning stage of company preparing feasibility studies, writing the expected financial flow-making realistic projections and determining the cost implication of intended projects. He also co-ordinates and uses the input from other professionals to compute, analyze and expose the financial implications of the entire line of action. 

Nnam added that the accountancy firms perform appraisal of investor to determine their viability and profitability and to check the stability of expected cash flow.

An accountant draft the Articles of Association, memorandum of Association and formulate the internal policy of the firms. These documents are then filed with the Register of companies. He can also help in the preparation of budget, business plan and installs control systems and procedures that generate necessary data from which information needed by business if processed. In same circumstances, a new or existing company may rely on an accountant for recruitment of some specialized manpower or he can send his staff on recommendation to a new business for specified period during which the firm is expected to stand on its own4

He also has important roles to play in the diversification and enhancing of the company’s profitability and stability of income. This is done through regular, advisory service on the best way to utilize ideal funds. He should be able to advise on the more profitable lines in the production process, the services which generate more value added, which services, products or departments should, which services, products or departments should be initiated and which should be discontinued. The accountant gathers and analyzes quantitative information and gives opinion as to which alternative makes economic sense.

An accountant can also act, as an insolvency practitioner by examining the company to the whether immediate liquidation is needed or whether the company still stands a chance to succeed.

He can act as a receiver by taking possession of the assets as charged to debenture holders and realizing them and which he withdraws from the company.

He can also act as liquidation by selling and collecting (in case of debts) the assets of the company and pays the proceeds to the entitled.

1.2   Statement of the Problem

Peter Langard stated that the most proprietors of small businesses look upon the statutory audit as an imposition and do not feel that there is any value to the business firm from it.

Thinking makes it imperative on the accountants to emphasis the non-audit roles in order to retain the prestige, improve their income, ensure the satisfaction of their clients and enhance national economic development.

Thus, most people including potential investors and entrepreneurs do not understand the expert services the professional accounting firm can provide them.

The above problem, that is the lack of understanding of the accountants other capabilities has called for some questions, answers to which will give an insight into the non-auditing roles of accounting firms, especially at the formation and infancy staged of business.

1.3   Objectives of the study

        The objectives of this study include but not limited to;

1. To understand theusual problems proprietors encounter prior to, at the formation and at the initial stage of their business.

2. To identify accountants’ usual function that are specifically relevant to the needs of new firms.

3. To identify how accountants assist in the planning, registration and management of young firm.

4. To know the extent in which accountant’s involvement help the firms to achieve growth and profitability.

5. To understand how an accountant affect the strategic decisions of an organization.

1.4   Research Questions

1. What are the usual problems proprietors encounter prior to, at the formation and at the initial stage of their business?

2. Which of the accountants’ usual function are specifically relevant to the needs of new firms?

3. Can accountants assist in the planning, registration and management of young firm?

4. To what extent can the accountant’s involvement help the firms to achieve growth and profitability?

5. How does an accountant affectthe strategic decisions of an organization?

1.5   Research Hypotheses

• : Accountant plays no significant role in the formation and operation of a viable business.
• : Accountant playssignificant role in the formation and operation of a viable business.

1.6   Significance of the Study

The main beneficiaries of this study are public, the accounting firms, professional accounting bodies and government.

PUBLIC: This study will enable an appreciate the duties of the accountants and their capabilities. In particular it will be useful to budding entrepreneurs who may find in the accounting firms, a useful instrument for realizing their dreams of owing their business and making profit through 

ACCOUNTANT FIRMS: Though this work, the accounting firms may understand more clearly the problems firms and individuals encounter which they are in position to solve.

Subsequently, it will enable them to broaden their services, acquire new clients and provide other related services to their audit clients. This undoubtedly will help improve their image and ultimately their income.

PROFESSIONAL ACCOUNTING BODIES: The outcome of the study may aid the understanding of the new challenges facing accountancy professional in their peculiar environment.

Consequently, this will guide professional accountancy bodies life institute of chartered Accountants of Nigeria, (ICAN) in determining and designing the type of training and exposure that, will be given to its existing and intending members in order to equip them adequately to tackle such problems. Thus, it may find the need to introduce courses and organize lectures with a view to making qualified accountants acquire new skills relevant to the needs of clients and the economy.

GOVERNMENT: The active participation of accountancy firms in the formation and development of new firms will help in the realization of governments objectives of encouraging small and medium scale industries. This study may show necessity of government to review certain laws that hinder the accountants from performing their roles in ensuring survival and growth of such firms and make new laws where necessary. Besides, government will benefit from the survival of such companies as it will derive income through taxes and job opportunities will be created.

1.7   Scope/Limitations of the Study

This study is on the role of accountant in formation and operation of a viable business with particular reference to Tantalizers in Uyo Local Government Area of AkwaIbom State, Nigeria.

Limitations of study

1. Financial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
2. Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

1.8   Definition of terms

Accountant: Is a practitioner of accounting or accountancy, which is the measurement, disclosure or provision of assurance about financial information that helps managers, investors, tax authorities and others make decisions about allocating resources.

Business Formation: Is a necessary early step of starting a business, whether you're registering a simple DBA, incorporating or forming a partnership

Business Operation:These are activities involved in the day to day functions of the business conducted for the purpose of generating profits.

A Business:A business, also known as an enterprise, agency or a firm, is an entity involved in the provision of goods and/or services to consumers.

REFERENCES

Collins, K. (2015). Exploring Business, v. 1.0. Retrieved from: http://catalog.flatworldknowledge.com / bookhub/7?e =collins-ch12_s01

Drury, C. (2009): Management accounting for business (4th Edition). United Kingdom. Cengage Learning EMEA.

Enofe, A. &Isiavwe, D. (2012). Corporate disclosure and governance in the Nigerian banking sector: An empirical evaluation. International Journal’s Research Journal of Social Science & Management. Singapore. ISSN : 2251-1571.

Koontz, H; O’Donnell, C; and Weihrich, H (1984).Management (8th edition). Japan. McGraw – Hill International Book Company

Okoye, A.E. (2011). Cost Accountancy: Management operational applications (second edition). Benin City. Mindex Publishing Co Ltd