CHAPTER ONE
INTRODUCTION
1.1Â Â Â Â Â Â Â Â Â Â Â Â BACKGROUND OF THE STUDY
Following reports of irregularities and malpractices in the government owned companies, then the state governor, chief, Jim Nwobodo appointed a panel of inquire to investigate the management finances and organization of the company.  This was in September 1980.          The panel discovered in the course of its investigations that the management like store ledger payment vouchers, cash books and accounting ledgers.  After a through investigations of the financial operation the panel found:-
a. Â That the company board started operation with out the necessary preparation that would enable it function well both as a service and profit making concern.
b.  That at the early stage of the company operation, only memorandum records of the financial transactions were kept.  The company board did not maintain proper books of accounts and the accounting system.  A very recent testimony to this assertion is the controversial case of NNPC(The Nigerian national petroleum corporation).  The missing #2.8 billion this was around 1979 and even recently more of such testimonies still exists.Testimonies at the House of Representatives special committee investigating the missing money revealed a gross deficiency in the accuracy of the accounting system.  The presidency then under the civilian administration set up a judicial commission of inquiry into the affairs of the NNPC.This country will be saved a lot of waste in the midst of poverty if our government corporation and parastatals are more efficiently managed.  It is in the light of this project is being carried out determine the accuracy as well as the adequacy of accounting system of one of the government owned companies in Enugu state with a view to ascertain how efficiently it has been contributing towards the improvement of the efficiency of the management of the company.
