AN EMPIRICAL INVESTIGATION INTO THE EXTENT OF COMPLIANCE WITH THE GOVERNMENT FINANCIAL REGULATION IN THE NIGERIAN PUBLIC SECTOR
This is an empirical study carried out to determine the extent of compliance with the government financial regulation in the Nigerian public sector. It is aimed at resolving issues regarding the relationship between the levels of compliance by public civil servants with the federal government financial regulations while carrying out the accounting function.
The study was motivated by the need to promote economic growth and development by effecting measure that will cut down the rate of fund misappropriation in the Nigerian public sector. In giving answers to the research problem, three hypotheses were developed; related literatures were sourced as well as questionnaires administered.
The results obtained were presented in percent frequency tables and statistical analysis was carried out using the sample correlation coefficient. From the analysis, findings reserved that there is a positive relationship between payment procedure in the public sector and the federal Government financial regulations. There is a negative relationship between supervision and custody of stores and the federal Government financial regulations.
From the findings, it is concluded that public officers charged with the duty of managing imprest are meant to adhere strictly with the rules laid down in the financial Regulation and they should also be kept abreast of the rules so as to promote transparency.
The machinery for financial administration of the federation was put in place between 1956 and 1958. The Government Financial Regulations was put in place in 1958, and since then it had seen only two reviews, in 1975/76 and 1990/2000. This was brought about by the 1988 Civil Service Reforms (Oshisami 1992).
The preface of the Commissioner (Minister) for Finance to the Revised Financial Regulations (1976) throws light on the position of government and its expectation on the role of the Financial Regulations in ensuring accountability, prevention of abuse, misuse or misappropriation of government funds (Oshisami, 1992).
Since 1976 when the Financial Regulations were last reviewed and published, the conduct of government business has undergone many transformations. From the mid 1980s especially, anyone with the slightest idea about how the machinery of good government should work, would have noticed that the time-tested ways of conducting government business have degenerated and fallen apart. Compliance with the Public Service Rules and Financial Regulations has been jettisoned and instead, regimes of indiscipline, disorder and arbitrariness were established (Obasanjo, 2000).
The heart of any country’s government administration is the management and control of its public purse. Government business is run in accordance to laid down rules and regulations. Obasanjo (2001) opined that, “All the elements that enhance efficiency, reliability and continuity of the system have been tampered with, resulting in major and saver setbacks for the conduct of government business. Government business was operated as if laws and rules on longer existed to govern the way and the manner public funds were expended. Public funds were disbursed illegally without recourse to the Financial Regulations: facilities of Central Bank of Nigeria (CBN) and the Nigeria Security Printing and Minting Company (NSPM) were recklessly abused and the Contingencies Fund was used without regard to the rules governing its operation.
In recent years, the number and monetary value of public sector activities have increased substantially and in Nigeria represent the main determinant of private sector prosperity. This increase in governmental activities and their importance had brought with it an increased clamor for more accountability. Officials and employees who manage these activities need to render adequate and timely accounts of the activities to the public. The public needs to receive reliable and easily understood accountability reports in order to access the performance of those entrusted with public resources. Thus, the accountability concept is inherent in the governance process of any nation. In fact, the obligations of person or entities, including public enterprises and corporations, entrusted with public resources to be answerable for the fiscal, managerial and other responsibilities that have been conferred on them and to report faithfully and truthfully to those that have conferred these responsibilities on them, is heart and soul of good democratic practice. It is therefore, to ensure that the legitimate processes of accountability are reinforced, that financial, accounting and audit regulations are put in place in the public sector (Owoyemi, 2005).
The rate of fund misappropriation in the Nigeria public sector is on the increase. This has led to the public asking questions as to the extent of compliance to laid down rules and regulations by the officials saddled with the responsibility of managing public funds.
According to Obasanjo (2000), all the elements that enhance efficiency, reliability and continuity of the system have been tampered with resulting in major and severe setbacks for the conduct of government business.
Some of these questions being asked by the public include:
The objective of this study is to proffer solutions to the problems of government financial management and control. Such objectives include;
The following hypotheses direct the thrust of this study.
1. Ho: There is no relationship between payment procedure in the public sector and the federal government financial regulations.
H1: There is a positive relationship between payment procedure in the public sector and the federal government financial regulations.
2. Ho: There is no relationship between supervision and custody of stores and the federal government financial regulations.
H1: There is a positive relationship between supervision and custody of stores and the federal government financial regulations.
3. Ho: The preparation and control of the payroll system in the public sector is not in line with the federal government financial regulations.
H1: The preparation and control of the payroll system in the public sector is in line with the federal government financial regulations.
This research will be of a great importance by way of its potentials in expanding the frontiers of knowledge. Thus, emphasis is laid on its academic, economic and social importance. It will fetch practical benefits, which includes the following:
The study was restricted to the Nigerian public sector, specifically the federal and state public services. It was the researcher’s conviction that apart from it being the engine room for economic development in Nigeria, the sector had witnessed tremendous growth and development over time.
Ministries/Extra-Ministerial Departments in Edo State were selected for the survey. A geographical scope of the study, broke into system of accounting for public funds and the compliance to rules and regulations guiding such system, was adopted. The aim was to facilitate a thorough analysis of the Ministries/Extra-Ministerial Departments’ implementation of rules and regulations guiding their system of accounting.
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