ACCOUNTING INFORMATION AS AN AID TO MANAGEMENT DECISION MAKING (EDUCATION PROJECT TOPICS AND MATERIALS)
CHAPTER ONE
INTRODUCTION
1.1 Background to the Study
Accounting, which is also known as accountancy is a “language of business. It provides financial information about one’s business to the internal and external users such as managers, investors and others. Also, accounting is the means by which information, about an enterprise is communicated; and the primary role of accounting information is to provide useful information for decision making purposes, it is sometimes referred to as a means to an end, with the end being the decision that is helped by the availability of accounting information. (Arneld and Hope,1990)
Accounting has the language of business because it is the basic tool for recording, reporting and evaluating economic events and transaction that affect business enterprise. Accounting processes all document of a business fiancial performance, from payroll cost, capital expenditure and other obligations to sales revenue and owner’s equity. Business can make appropriate financial and strategies decision about their future with the help of accounting information. Conversely, incomplete or inaccurate accounting data can cripple a company, no matter its size or orientation.
Accounting is important as barometer of business navigation, management accounting its goals, objectives and mission, assessing past performance and evaluating and rewarding decision-making performance. Some of the important characteristics of management accounting information are timeless, its relationship to decision making authority, its future orientation, its relationship to measuring efficiency and effectiveness, and the fact that it is a means to an end. Management is the art of making particularly through people, for the achievement of the broad goals of an organization (Ejiofor,1987). In trying to achieve these goals, the manager has to map out strategies to find out the accounting information suitable for the company
Cole (1986), defined management as a process which enables organizations to achieve their objectives by planning, organizing and controlling their resources including gaining the commitment of their employees.
Stoner and Wankel (1986), defined management as the process of planning, organizing, leading, controlling the efforts of organization members and using all other organizational resources (human and materials) to achieve the stated organizational goals and objectives..
Robins and Contler (1989), defined management as the process of coordinating work activities so that they are completed efficiently and effectively with and through other people’s efforts. This implies that, management involves directing, planning, programming, organizing, influencing, time control, financing, regulating, personnel, the conduct of meeting, upward as well as downward communication, and decision making.
