ABSTRACT
External borrowing is a source through which many countries source revenue for development and economic growth of their countries. But this revenue can only help solve the problems of gross under – development when judiciously utilized.
The burden of Nigeria’s external debt is more than the country can bear and the state of economic growth in the country is hampered due to debt crisis.
The debt problem facing Nigeria is concerned on how to stop incurring more debts and device a way of servicing the existing debt without causing some distortions in the economy. For effective and efficient debt servicing, factors that hiders it has to be taken care of i.e. domestic financing policies, debt management and external economic environment.
External debt affects the economic growth, the level of money supply and employment in the country. So, Nigeria can solicit for debt cancellation from it’s creditors and also adopt debt management as pat of it’s macro economic policies of the nation and finally engage in productive projects.
TABLE OF CONTENT
TITLE PAGE
APPROVAL PAGE
DEDICATION
ACKNOWLEDGEMENT
ABSTRACT
TABLE OF CONTENT
CHAPTER ONE
0.0 INTRODUCTION
1.1 BACKGROUND OF STUDY
1.2 STATEMENT OF PROBLEM
1.3 OBJECTIVE OF THE STUDY
1.4 RESEARCH QUESTION
1.5 RESEARCH HYPOTHESIS
1.6 SIGNIFICANCE OF THE STUDY
1.7 SCOPE, LIMITATION AND DELIMITATION
1.8 DEFINITION OF TERMS
REFERENCES
CHAPTER TWO
REVIEW OF RELATED LITERATURE
2.0 INTRODUCTION
2.1 DEFINITION OF EXTERNAL DEBT AND ECONOMIC GROWTH
2.2 CAUSES OF EXTERNAL DEBT CRISIS IN NIGERIA
2.3 CONSEQUENCES OF NIGERIA’S EXTERNAL DEBT
2.4 THE NATURE OF ECONOMIC GROWTH IN NIGERIA
2.5 CONDITIONS FOR RAPID ECONOMIC GROWTH IN NIGERIA
2.6 STRUCTURE OF NIGERIA’S EXTERNAL DEBT
2.7 NIGERIA’S DEBT MANAGEMENT STRATEGIES
2.8 PROBLEMS AND PROSPECTS OF NIGERIA’S EXTERNAL DEBT
MANAGEMENT
CHAPTER THREE
RESEARCH DESIGN AND METHODOLOGY
3.1 RESEARCH DESIGN
3.2 RESEARCH METHODOLOGY
3.3 AREA OF STUDY
3.4 LOCATION OF DATA
3.5 DESCRIPTION OF POPULATION
3.6 SAMPLE SIZE
3.7 INSTRUMENT OF DATA COLLECTION
3.8 METHOD
3.9 TECHNIQUES OF DATA ANALYSIS
REFERENCE
CHAPTER FOUR
DATA PRESENTATION ANALYSIS AND INTERPRETATION
4.1 PRESENTATION OF FOR HYPOTHESIS
4.2 TEST OF HYPOTHESIS ONE
4.3 PRESENTATION DATA FOR HYPOTHESIS TWO
4.4 PRESENTATION FOR HYPOTHESIS THREE
REFERENCES
CHAPTER FIVE
SUMMARY OF FINDINGS, RECOMMENDATION AND CONCLUSION
5.1 SUMMARY OF FINDINGS
5.2 RECOMMENDATION
5.3 CONCLUSION
BIBLIOGRAPHY
CHAPTER ONE
INTRODUCTION
BACKGROUND OF STUDY
Every country in the world aim at achieving economic growth and development. However, this is only possible if a country has adequate resources. In developing countries, especially those in sub Sahara Africa, the resources to finance the optimal level of economic growth and development are in short supply. This is as a result of the economies ploughed with problems of low domestic savings, low tax revenues, low productivity and meager foreign exchange earnings.
Basically, for these reasons, many developing countries yearning for economic growth inevitably resort to external financing to bridge the gap between their savings and investments. In the process of obtaining finance from abroad, a country may consider several options: grants, foreign investment and loans (concessional and non – concessional) in that order. However, mix of these capital in – flow in varying proportion could be obtained depending on the socio – economic and political situation in a country.
Nigeria like most developing countries borrowed from external sources mainly for investment purposes. The country’s external debt was sustainable up to mid 1970’s. From the late 1970’s because of poor macro – economic management and declining prices of crude oil, the country’s external debt began its upward movement. Thus from an external debt of US $ 557.74 million in 1975. Nigeria debt peaked at US $33.1 billion in 1990 before declining to US $27.1 billion in 1997 and rose to US $ 28.8 billion in 1998. However, one of the greatest problems facing African countries basically classified as the amount of their external indebtedness. The external debt problem is becoming more and more for many reasons. This problem of increasing rate of the external debt is threatening the development programmes embarked upon by these countries: thereby retarding their economic growth and development. The reason being that the size of the debt relative to size of the economy’s GNP is enormous. Also, the current system of debt management has a serious macro – economic impact on an economy’s output: as such, there is an urgent need to reduce Africa’s total outstanding debt service payments as well as accumulating of arrears on payments.
In 1986, the Federal Government introduced the Structural Adjustment Programme (SAP) to address the problem of structural imbalance in the economy and create an atmosphere for the achievement of macro – economic stability. It is obvious that one of the integral part of the SAP is to reduce Nigeria huge debt. It is a fact that if the enormous amount spent on debt service payment could be reduced greatly, the country will be able to finance a large volume of domestic investment which would enhance growth and development.
The problem of the rising external debt of the less developed countries (LDCs) is giving nightmares not only to the debtor nations that is worrying about how to earn enough foreign exchange to at least service their huge external debts but also to the creditors that are worried about the tendency of the debts becoming bad and irrecoverable.
To most debtors nations, the adage “ to go a borrowing is to go as sorrowing” is a biting truism. This is not to say that the researcher is against borrowing either internally or externally. In fact, from the on set, the researcher strongly believes that external funds if judiciously utilized will go a long way to help solve or at least alleviate the problems of gross under – development confronting most of the LDCs. Getting out of the “debt trap” is now the major concern of both the creditors and the debt nations. The debtors should not be made to bear the burden of miscalculation of botgh the creditors ( who were reckless in the approach to lending during this peak of the “ petro dollar boom” for being too short sighted as not to see the strings and traps attached to the loans.
Perhaps, the above cannot be more representative of the Nigeria situation which is likened to an extravagant person who is hosting his friends and associates to an all exercise – paid, no holds barred party, which after the parting found himself unable to settle even a fraction of the bill and all the guest gone, not even a person to be seen to offer moral succor to the lavish host. This vividly describes the Nigeria external debt problem. Having wasted all the borrowed funds and having nothing to show for it, Nigeria is woken up to unending knocks of the creditors.
Unfortunately, ability to pay is close to zero. This is becomes more pathetic when it can be seen that Nigeria is now called upon to pay when the economy is in a depressed mood. More so, the borrowed funds are embarked on ill conceived projects which are equally badly implemented. However, the new international economic order sets out as one of it’s objectives to secure favourable conditions for the transfer of resources to developing countries and to ensure that a country’ resources are fully utilizes for the development of the country concerned. Thus, Nigeria resorted to external borrowing early in her history so as to quicken the pace of economic development. The issue of Nigeria’s external debt generated much public concern at the beginning of 1980.
Actually, Nigeria’s external indebtedness started during the colonial days. The last of colonial borrowing was the World Bank (IBRD) loan of 1958 used to finance Nigeria Railway Corporation extension to Bornu under the guarantee of the United Kingdom Government ( Felagan 1978). It is believed that debt is generated by the gap between domestic savings and investment, and export earning which increases in absolute terms over time. As the gap widens and the debts accumulates, interest charges also accumulate and a country must borrow more to maintain constant flow of net imports and to refinance maturing debt obligations.
Nevertheless, external borrowing became a conscious public policy when in 1960, the Government promissory notes ordinance was enacted for the purpose of raising authorized loans. Under the ordinance, a sinking fund was also established for redeeming loans raised. In 1962, the external loans Act was enacted by parliament which provided for the raising of the loan outside Nigeria. Under the Act, external loans were to be used for the purpose of development program and for making loans to regional government.
In 1970, after the civil war “ The External Loan Rehabilitation, Reconstruction and Development” decree was promulgated. The decree authorized Federal Commission to raise loans outside Nigeria for amount not above N1 billion. The loan is for rehabilitation, reconstruction and development programme for making loans to state government. These various regulations on external loans became the policy guidelines not only in magnitude but also in the direction.
Nigeria’s debt crisis could also be traced to the misdirect economic policies pursued since the buoyancy of the oil market which resulted in an outright neglect of the non – oil sector of the economy especially agriculture. Owing to this neglect of other sectors in the economy, the oil sector provided over 905 of the government national revenue, so fluctuations that occurred in the oil market in 1978 and 1980s distorted the projected revenue estimates of the federal government. Hence, the government had to borrow to fill the gaps created by the fluctuation and also meets the increasing expenditures. Thus, Nigeria’s debt as recorded by the Central Bank of Nigeria in 1978 was N1, 265.7 million or US $2.2 billion;N8819.4 million or US $ 13.1 billion in 1982 and N133,956.2 million in 1988. More so, the total outstanding external debt of Nigeria went up to N240, 033.6 million in 1989 in addition, it is said that the debt keeps rising yearly ( defying Newton’s law of gravity) as Nigeria was owning N648,813 million as at 1994 and N3,097,383.8 million as at 2000.
The debt situation was also intensified by large public deficit relatively free capital in – flows, inefficient control over private capital out flows and real over valuation of the exchange rate of naira to other world currencies. For these reasons and others, debt problem has become one of the most pressing issues in the world’s political and economic relationship for a LDC like Nigeria.
In essence, what matters most is not the amount of the foreign loans but the ways and manner the loans are used in developmental process. If these loans are used for current consumption, they will have minimal impact on future economic growth but if invested rationally in productive ventures, they will contribute positively to real growth and enhance the productive capacity of the economy. The fact is that development depends purely on a sustained increase in real income, which can only be achieved or accumulated from economic growth.
Economic growth however, emphasizes on the changes in economy’s productivity over time. Growth tends to occur when total production increases more rapidly than population. Thus, it is the country’s ability to maintain a strong defense or to pay for some other national project. As a matter of fact, economic growth is an ever increasing quantity of goods and services available to meet the economy’s need over time. As a result, the higher the ratio of debt servicing payments, the lower the level of economic growth. The primary burden of Nigeria’s public debt is indeed shifted to the future, thereby retarding economic growth. The rate of investment tens to be low and unemployment rate become high because of our huge public debt. Furthermore, our reputation is tarnished and the developed nations are no longer confident in our economy. This rise to reductio0n in the flow of foreign investment to Nigeria, which could have profound consequences for the economic development prospect of the nation. With the oil glut and reduced revenue, it is expected that our external debt liabilities will increase and our economy will be unstable. The debt crisis if not well managed will lead to liquidity crisis and foreign exchange crisis, which will retard the rate of economic growth and development in Nigeria.
STATEMENT OF THE PROBLEM
The issue of external debt in Nigeria has become an immense status bestriding the main stream of international economy and politics. Foreign loans and aids are no longer used as instrument of assistance but as a weapon of oppression, suppression and perpetual under development. That the management of external debt has assumed a critical dimension for Nigeria not in doubt. This can be seen in the rising total of external debt outstanding and the cost of servicing the huge debt. From the comfortable position of lending even from the International Monetary Fund (IMF) and Africa Development Bank (ADB). Nigeria became one of the biggest debtor nations in the world and was listed among the biggest debtor nations in the world and was listed among the fifteen most indebted nations in the banker plan list.
At the end of civil war in 1970, the country’s external indebtedness was relatively low and was of little significance till 1974. But by 1977, external debt of Nigeria was N496.9 million and it rose by over 205% to N1,265.7 million or US $ 2.2 billion referred to as the “ Jumbo Loan” and was contracted from the international capital market (ICM) in 1978. This sky rocketed to US $32.6 billion at December end, 1995.
With huge debt outstanding, debt service obligations rose astronomically as a result of rising interest rates in the international money market and declining grace period and grant element leaving little of foreign exchange for import of external raw materials and consumers goods
OBJECTIVES OF THE STUDY
The broad objectives of the study are mainly:
- To critically examine the external debt problem in Nigeria between 1993 to 2004
- To assess the problems of external debt and their implications on the economies of the debtors countries.
- To analyze the factors affecting debt servicing capacity of nations.
- To analyze the impact of external debt problem on he level of money supply in an economy.
- To suggest and recommend ways of improving on the debt management policies in Nigeria.
- To determine external debt problem on level of employment.
- To determine factors affecting economic growth.
RESEARCH QUESTIONS
- What is the causes of external debt problems in Nigeria between 1992 – 2004?
- To what extent has the external debt problem risen and what impact do it have on economies of debtor countries?
- What are the factors affecting the debt servicing capacity of nations?
- To what extent is the impact of external debt on the level of money supply in an economy?
- In what ways can debt management policies in Nigeria be improved?
- What is the state of external debt problem on the level of employment?
- What is the state of economic growth in Nigeria?
RESEARCH HYPOTHESES
For the purpose of evaluating or in order to efficiently and objectively analyze or achieve the above objective, the hypotheses is formulated thus:
1A. Ho: External debt has no significant impact on the GOP of economic growth in Nigeria.
B. Hi: External debt has significant impact on the GOP of economic growth in Nigeria.
2A.Ho: External borrowing has no significant impact on the level of money supply in the economy.
Hi: External borrowing has significant impact on the level of money supply in the economy.
3A. Ho: The level of external debt does not have any significant impact on employment.
B. Hi: The level of external debt has significant impact on employment.
SIGNIFICANCE OF THE STUDY
The nature of Nigeria economy has made it to be vulnerable to external shocks. Over the years, Nigerian economy is having adverse balance of payment which could be easily financed from domestic sources and hence external borrowing becomes inevitable .The adverse effect of external debt and economic growth related problems on the Nigerian economy are becoming unbearable. So the study will be of importance to educate Nigerians by revealing to them one of the major reasons why Nigerian economy is growing at a very slow rate, which could be traced back to the huge amount of foreign earning s spent on the external debt services instead of spending it on domestic investment. Thus an undecked growth in foreign exchange outflows to service accumulating debt, which will only further entrench under development of Nigeria economy .This means increasing poverty ,ignorance ,disease and other conceivable socio political maladies.
Furthermore, this study will be of a good help to the Nigerian government, especially the present government to know the effectiveness of the external debt and economic growth polices implemented in the previous years and know exactly the next step to follow now in curtailing the total outstanding external debt because it is very obvious that the Nigeria external debt is now growing at alarming rate yearly. It must be added that this study is of relevance not only to Nigeria but to almost all the countries classified as LDCs especially as a result of various common features.
SCOPE, LIMITATIONS AND DELIMITATIONS
SCOPE – The study is designed to cover the period of 1992 – 2004 and concentrates only on the external debt in Nigeria and also economic growth.
LIMITATIONS – In the course of carrying out this study, some problems were encountered which ranges from non- availability of relevant recent data to the paucity of available ones. This display of uncooperative attitude by those who are supposed to be the custodian of the data, also affected this in many ways. To this extent a considerable exercise and judgments s was necessitated in dealing with the data. Time and fund also are included in the limiting factors to the collection of adequate data. Enough time is needed in order to travel to other financial institutions and other federal and state ministries of finance in order to get adequate information needed. This also posses a problem of finance due to transportation cost and the present economic situation in the country.
DELIMITATION – Due to the above limitations, the researcher therefore had to restrict the collection of data within Enugu only especially as a result of financial constraint.
DEFINITION OF TERMS
EXTERNAL DEBT – External debts are debts incurred when the government of a country borrows from a foreign banks ,Government and International institutions like IMF,WORLD BANK, PARIS CLUB etc. Also it can be seen as unpaid portion of external resources required for developmental purposes and balance of payment support which could not repaid when they fell due.
BALANCE OF PAYMENT – A systematic record of all transactions between residents of one country and the rest of the world .It is a statement of all the financial and economic transactions between one country and the rest of the world over a given period of time. It becomes unfavorable or adverse when there is excess importation over exportation.
ECONOMIC GROWTH – I s a long term rise I capacity to supply increasingly diverse economic goods to its populations. This growing capacity is based on advancing technology ,the institutional and ideological adjustment that it demands. It refers to increasing real output or real per capital output of economy.
ECONOMIC DEVELOPMENT – A multidimensional process involving the reorganization and re orientation of entire economic and social system.
REFERENCES
Stephen N.M, Eghosa.O (1985), A textbook of economics for West African Students, Ibadan. University press ltd Ibadan, pp 210- 219 .
CBN Briefs (1996 ), Management of Nigeria’s public Debt, Research Department, series no. 96 /09 pp 1 – 6.
Udeh,S.O ( 1999 ) College Economies ; An omni – text,
Enugu; ADK Educational Industries ltd
Pp 301 – 310.
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Tags: (1992 – 2004)., AN ANALYSIS OF EXTERNAL DEBT AND ECONOMIC GROWTH IN NIGERIA
ABSTRACT
The study is concerned with an investigation into fraud and financial malpractices as a leading factor in business failure and eventual liquidation.
A case study of Nigerian Telecommunication Limited(NITEL).
By way of background, the study commenced with an overview of the business environments and its effects on business growth and survival.
Using NITEL as a case study, it was established that inspite of its privatization, NITEL is still saddled with the problem of bad image arising mostly from fraudulent practices.
With the above stated problem, the specific objectives of the study were:
1. To ascertain why NITEL Plc is still saddled with problem.
2. To determine whether there is significant weakness in NITEL internal control system.
Data collected were analysed using weighted mean and ranking order. Major findings of the study were:
(i) The study revealed that the NITEL is unable to achieve its objective
(ii) It was also revealed that fraud and financial malpractices was the most important factors that has contributed poor performance of NITEL.
At the end, the following recommendation were made:
(i) NITEL management should design appropriate policies.
(ii) The organisation should also strengthened its internal control system.
LIST OF TABLE
3.1 Sample size determination and allocation of questionnaire
4.1 Factors responsible for non-achievement of objectives by NITEL
4.2 Factors responsible for fraudulent malpractices in NITEL
4.3 Factors in effective internal control system in NITEL
4.4 Impact assessment of factors in fraud elimination / minimization
TABLE OF CONTENTS
Title page ii
Approval page iii
Dedication iv
Acknowledgement v
Abstract vi
List of table viii
Table of content ix
CHAPTER ONE
Introduction 1
1.1 Background of study 1
1.2 Statement of problem 4
1.3 The purpose of study 5
1.4 Scope of study 6
1.5 Research question 6
1.6 Significance of the study 7
CHAPTER TWO
Review Of Literature 9
2.1 Definition of distress/failures of a corporate 9
2.2 Causes of business failure 12
2.3 Summary of related reviewed literature 29
CHAPTER THREE
Research design and Methodology 30
3.1 Research design 30
3.2 Area of study 30
3.3 Population of the study 30
3.4 Sample size and sampling procedure 31
3.5 Instruments for data collection 34
3.6 Validity of the instrument 34
3.7 Reliability of the instrument 35
3.8 Method of administration of the research instrument 35
3.9 Method of data analysis 36
CHAPTER FOUR
Data Presentation And Results 37
4.1 Research question 1 37
4.2 Research question 2 40
4.3 Research question 3 42
4.4 Research question 4 45
4.5 Summary of findings 47
CHAPTER FIVE
Discussion Of Results, Conclusion, Implication Of Findings 49
5.1 Discussion of findings 49
5.2 Conclusions 51
5.3 Implications of the study 52
5.4 Recommendations 52
5.5 Suggestions for further studies 53
5.6 Limitation of the study 54
References 55
Appendix 57
CHAPTER ONE
INTRODUCATION
1.1 BACKGROUND OF THE STUDY
Fraud is irregularities involving the use of criminal to obtain and against illegal advantage.
Fraud involving the manipulation of the record and the accounts, usually by the company’s senior officers, with a view to benefiting in some way from the false picture which they convey (eg obtaining finance under false pretences, or concealing a material worsten of the company’s true position)
Frauds, usually by employees, involving the theft, misappropriation or embezzlement of the company\s funds, usually in the form of cash, or of its other assets (such as good held in a warehouse).
Fraud and financial malpractices in many business involving the public sector organisation today contribute mostly to one of the factor that lead to business failure.
In all human endeavour and activities, there are usually stories of successes achievement and failures.
Business are therefore no exception initially, a motive for setting up a company is for economic reasons which are usually taken to be profit maximization objectives in period of booms as was experiences in the mid seventies during the oil boom; making business, including the public sector organizations, thieved in an era of abundance.
In such as era employment production and income were at their peak level and government expenditures at all levels rise considerably without any corresponding rise in productivity.
During this period also, no one complained and managers of our various businesses did not think of means of survival and sufferance.
Efficiency and effectiveness in the use of scare resources were never thought of and there were total absence of research control mechanisms.
Economic planners in such periods, makes unrealistic projections and assumptions they plan to build high ways, sky scrappers, new state capital (or new cities), contracts were awarded induscomminately without the need for detailed cost benefit analysis.
In summary, the sky was the limit for businesses that have access to cheap credits, and investible funds. In such periods, capital inadequacy, under utilization of production capacity, deficiency in aggregate demand for the firm’s product etc, were never heard of during the peak periods.
Contrary, when the hay days were over and the down turns take over the dooms day arrives and business failures becomes the order of the day as a result of adverse macro-economic policies and resulting adverse conditions.
Consequently, expansion is hindered for even the surviving firms. This is the time when company executives/managers, government federal, state and local governments as well as individuals, remember to think of such phrases as viability, belt tightening profitability, growth and survival and better ways or resource planning, control and managements, it is a time when managers/directors of our business firms, public companies/corporations and other governmental organization now thinks of cost reduction and minimization of fraud and financial malpractices which has hitherto plunge such organisation into distressed conditions.
The adverse marco-economic conditions in Nigeria today has attained a dimension that can best be described as “crisis” level. This had led to some drastic measures/programmes being initiated by the government to keep the nation afloat.
Such measures have come in different names at different times, ranging from the belt tightening of the Shagari administration through economic emergency order of the Buhari – regime to the structural adjustment programme (SAP).
As a result of these measures, firms and individuals have found themselves in extremely hard conditions to the extent that some have failed completely, other are stagnated and distressed.
What factors are specifically responsible for such state of affirms of the business firms?
This project is set out to investigate how fraud and financial malpractices can bring a highly profitable organizations into distressed and untimely liquidation.
1.2 STATEMENT OF PROBLEMS
(1) Inspite of the federal government in privatalsing the telecommunication industry, NITEL Plc is still saddled with the problem of bad image arising mostly from fraudulent malpractices by both management and staff of the company
(2) INTERNAL CONTROL: There are inherent weakness in the internal control system of NITEL Plc.
(3) NIEL Plc management does not consider policy or fraudulent cases as strategic in its decision taking.
(4) NITEL Plc has not met with the expectation of its investors as a practiced entity since its privatization.
1.3 PURPOSE OF THE STUDY
1. To fund out the extent of which bad image arising mostly from fraudulent malpractices by both management and staff despite of its privatization.
2. To ascertain the extent to which inherent weakness in the internal control system of NITEL Plc.
3. To find out the extent in which they do not consider policy or fraudulent cases as strategic in its decision taking.
4. To find out the extent in which they do not met with the expectation of its investors as a privatized entity since it privatization.
1.4 SCOPE OF THE STUDY
The scope of this study mainly focuses on fraud and financial malpractices as a leading factors in business failure. The survey is to be carried out at NITAL Plc Okpara Avenue, Enugu in Enugu State.
1.5 RESEARCH QUESTION
For the purpose of this study the follow research questions were asked:
1. To what extent does bad image arising mostly form fraudulent malpractices by both management and staff of the company affect business.
2. To what extent does inherent weakness in internal control system of NITEL Plc contribute to fraud and financial malpractice.
3. To what extent does inability to consider policy on fraudulent cases as strategic in its decision taking brought about business failure.
4. To what extent does damages caused by fraudulent and financial malpractices on the expectations of the investors on their returns.
1.6 SIGNIFICANCE OF THE STUDY
Significance of the study refers to the importance or usefulness of the research to individuals, shareholders, management, potentials investors, suppliers/creditors and all those having one interest or the other on the operations of the business firms.
The ultimate aim of every research is to provide knowledge and information that will bring about a better understanding of the topic under review.
Specifically this project will offer enough information and explanation to the management of NITEL Plc, the government and the general public.
Furthermore, the research findings and recommendations will form a basis to be relied upon by subsequent researcher who may wish to make further inquiries on the issue of fraudulent practices and its effect on business failure.
1. To ensure that good image will arise mostly from fraudulent malpractices by both management and staff of the company.
2. To ensure useful solution of eliminate inherent weakness in internal control system.
3. To make sure that there is consider policy on fraudulent cases as strategic in its decisions making.
4. To ensure that they met with the expectation of its investors on their returns.
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Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
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OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
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But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
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That you ordered this material shows you have agreed not to copy word-to-word.
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08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
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Tags: FRAUD AND FINANCIAL MALPRACTICES AS A LENDING FACTOR TO BUSINESS FAILURE (A CASE STUDY OF NIGERIAN TELECOMMUNICATION LIMITED (NITEL)
ABSTRACT
The study is concerned with an investigation into fraud and financial malpractices as a leading factor in business failure and eventual liquidation.
A case study of Nigerian Telecommunication Limited(NITEL).
By way of background, the study commenced with an overview of the business environments and its effects on business growth and survival.
Using NITEL as a case study, it was established that inspite of its privatization, NITEL is still saddled with the problem of bad image arising mostly from fraudulent practices.
With the above stated problem, the specific objectives of the study were:
1. To ascertain why NITEL Plc is still saddled with problem.
2. To determine whether there is significant weakness in NITEL internal control system.
Data collected were analysed using weighted mean and ranking order. Major findings of the study were:
(i) The study revealed that the NITEL is unable to achieve its objective
(ii) It was also revealed that fraud and financial malpractices was the most important factors that has contributed poor performance of NITEL.
At the end, the following recommendation were made:
(i) NITEL management should design appropriate policies.
(ii) The organisation should also strengthened its internal control system.
LIST OF TABLE
3.1 Sample size determination and allocation of questionnaire
4.1 Factors responsible for non-achievement of objectives by NITEL
4.2 Factors responsible for fraudulent malpractices in NITEL
4.3 Factors in effective internal control system in NITEL
4.4 Impact assessment of factors in fraud elimination / minimization
TABLE OF CONTENTS
Title page ii
Approval page iii
Dedication iv
Acknowledgement v
Abstract vi
List of table viii
Table of content ix
CHAPTER ONE
Introduction 1
1.1 Background of study 1
1.2 Statement of problem 4
1.3 The purpose of study 5
1.4 Scope of study 6
1.5 Research question 6
1.6 Significance of the study 7
CHAPTER TWO
Review Of Literature 9
2.1 Definition of distress/failures of a corporate 9
2.2 Causes of business failure 12
2.3 Summary of related reviewed literature 29
CHAPTER THREE
Research design and Methodology 30
3.1 Research design 30
3.2 Area of study 30
3.3 Population of the study 30
3.4 Sample size and sampling procedure 31
3.5 Instruments for data collection 34
3.6 Validity of the instrument 34
3.7 Reliability of the instrument 35
3.8 Method of administration of the research instrument 35
3.9 Method of data analysis 36
CHAPTER FOUR
Data Presentation And Results 37
4.1 Research question 1 37
4.2 Research question 2 40
4.3 Research question 3 42
4.4 Research question 4 45
4.5 Summary of findings 47
CHAPTER FIVE
Discussion Of Results, Conclusion, Implication Of Findings 49
5.1 Discussion of findings 49
5.2 Conclusions 51
5.3 Implications of the study 52
5.4 Recommendations 52
5.5 Suggestions for further studies 53
5.6 Limitation of the study 54
References 55
Appendix 57
CHAPTER ONE
INTRODUCATION
1.1 BACKGROUND OF THE STUDY
Fraud is irregularities involving the use of criminal to obtain and against illegal advantage.
Fraud involving the manipulation of the record and the accounts, usually by the company’s senior officers, with a view to benefiting in some way from the false picture which they convey (eg obtaining finance under false pretences, or concealing a material worsten of the company’s true position)
Frauds, usually by employees, involving the theft, misappropriation or embezzlement of the company\s funds, usually in the form of cash, or of its other assets (such as good held in a warehouse).
Fraud and financial malpractices in many business involving the public sector organisation today contribute mostly to one of the factor that lead to business failure.
In all human endeavour and activities, there are usually stories of successes achievement and failures.
Business are therefore no exception initially, a motive for setting up a company is for economic reasons which are usually taken to be profit maximization objectives in period of booms as was experiences in the mid seventies during the oil boom; making business, including the public sector organizations, thieved in an era of abundance.
In such as era employment production and income were at their peak level and government expenditures at all levels rise considerably without any corresponding rise in productivity.
During this period also, no one complained and managers of our various businesses did not think of means of survival and sufferance.
Efficiency and effectiveness in the use of scare resources were never thought of and there were total absence of research control mechanisms.
Economic planners in such periods, makes unrealistic projections and assumptions they plan to build high ways, sky scrappers, new state capital (or new cities), contracts were awarded induscomminately without the need for detailed cost benefit analysis.
In summary, the sky was the limit for businesses that have access to cheap credits, and investible funds. In such periods, capital inadequacy, under utilization of production capacity, deficiency in aggregate demand for the firm’s product etc, were never heard of during the peak periods.
Contrary, when the hay days were over and the down turns take over the dooms day arrives and business failures becomes the order of the day as a result of adverse macro-economic policies and resulting adverse conditions.
Consequently, expansion is hindered for even the surviving firms. This is the time when company executives/managers, government federal, state and local governments as well as individuals, remember to think of such phrases as viability, belt tightening profitability, growth and survival and better ways or resource planning, control and managements, it is a time when managers/directors of our business firms, public companies/corporations and other governmental organization now thinks of cost reduction and minimization of fraud and financial malpractices which has hitherto plunge such organisation into distressed conditions.
The adverse marco-economic conditions in Nigeria today has attained a dimension that can best be described as “crisis” level. This had led to some drastic measures/programmes being initiated by the government to keep the nation afloat.
Such measures have come in different names at different times, ranging from the belt tightening of the Shagari administration through economic emergency order of the Buhari – regime to the structural adjustment programme (SAP).
As a result of these measures, firms and individuals have found themselves in extremely hard conditions to the extent that some have failed completely, other are stagnated and distressed.
What factors are specifically responsible for such state of affirms of the business firms?
This project is set out to investigate how fraud and financial malpractices can bring a highly profitable organizations into distressed and untimely liquidation.
1.2 STATEMENT OF PROBLEMS
(1) Inspite of the federal government in privatalsing the telecommunication industry, NITEL Plc is still saddled with the problem of bad image arising mostly from fraudulent malpractices by both management and staff of the company
(2) INTERNAL CONTROL: There are inherent weakness in the internal control system of NITEL Plc.
(3) NIEL Plc management does not consider policy or fraudulent cases as strategic in its decision taking.
(4) NITEL Plc has not met with the expectation of its investors as a practiced entity since its privatization.
1.3 PURPOSE OF THE STUDY
1. To fund out the extent of which bad image arising mostly from fraudulent malpractices by both management and staff despite of its privatization.
2. To ascertain the extent to which inherent weakness in the internal control system of NITEL Plc.
3. To find out the extent in which they do not consider policy or fraudulent cases as strategic in its decision taking.
4. To find out the extent in which they do not met with the expectation of its investors as a privatized entity since it privatization.
1.4 SCOPE OF THE STUDY
The scope of this study mainly focuses on fraud and financial malpractices as a leading factors in business failure. The survey is to be carried out at NITAL Plc Okpara Avenue, Enugu in Enugu State.
1.5 RESEARCH QUESTION
For the purpose of this study the follow research questions were asked:
1. To what extent does bad image arising mostly form fraudulent malpractices by both management and staff of the company affect business.
2. To what extent does inherent weakness in internal control system of NITEL Plc contribute to fraud and financial malpractice.
3. To what extent does inability to consider policy on fraudulent cases as strategic in its decision taking brought about business failure.
4. To what extent does damages caused by fraudulent and financial malpractices on the expectations of the investors on their returns.
1.6 SIGNIFICANCE OF THE STUDY
Significance of the study refers to the importance or usefulness of the research to individuals, shareholders, management, potentials investors, suppliers/creditors and all those having one interest or the other on the operations of the business firms.
The ultimate aim of every research is to provide knowledge and information that will bring about a better understanding of the topic under review.
Specifically this project will offer enough information and explanation to the management of NITEL Plc, the government and the general public.
Furthermore, the research findings and recommendations will form a basis to be relied upon by subsequent researcher who may wish to make further inquiries on the issue of fraudulent practices and its effect on business failure.
1. To ensure that good image will arise mostly from fraudulent malpractices by both management and staff of the company.
2. To ensure useful solution of eliminate inherent weakness in internal control system.
3. To make sure that there is consider policy on fraudulent cases as strategic in its decisions making.
4. To ensure that they met with the expectation of its investors on their returns.
HOW TO GET THE FULL PROJECT WORK
PLEASE, print the following instructions and information if you will like to order/buy our complete written material(s).
HOW TO RECEIVE PROJECT MATERIAL(S)
After paying the appropriate amount (#10000) into our bank Account below, send the following information to
08139462710 or 08137701720
(1)Your project topics
(2) Email Address
(3) Payment Name
(4)Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: FRAUD AND FINANCIAL MALPRACTICES AS A LENDING FACTOR TO BUSINESS FAILURE (A CASE STUDY OF NIGERIAN TELECOMMUNICATION LIMITED (NITEL)
ABSTRACT
The study is concerned with an investigation into fraud and financial malpractices as a leading factor in business failure and eventual liquidation.
A case study of Nigerian Telecommunication Limited(NITEL).
By way of background, the study commenced with an overview of the business environments and its effects on business growth and survival.
Using NITEL as a case study, it was established that inspite of its privatization, NITEL is still saddled with the problem of bad image arising mostly from fraudulent practices.
With the above stated problem, the specific objectives of the study were:
1. To ascertain why NITEL Plc is still saddled with problem.
2. To determine whether there is significant weakness in NITEL internal control system.
Data collected were analysed using weighted mean and ranking order. Major findings of the study were:
(i) The study revealed that the NITEL is unable to achieve its objective
(ii) It was also revealed that fraud and financial malpractices was the most important factors that has contributed poor performance of NITEL.
At the end, the following recommendation were made:
(i) NITEL management should design appropriate policies.
(ii) The organisation should also strengthened its internal control system.
LIST OF TABLE
3.1 Sample size determination and allocation of questionnaire
4.1 Factors responsible for non-achievement of objectives by NITEL
4.2 Factors responsible for fraudulent malpractices in NITEL
4.3 Factors in effective internal control system in NITEL
4.4 Impact assessment of factors in fraud elimination / minimization
TABLE OF CONTENTS
Title page ii
Approval page iii
Dedication iv
Acknowledgement v
Abstract vi
List of table viii
Table of content ix
CHAPTER ONE
Introduction 1
1.1 Background of study 1
1.2 Statement of problem 4
1.3 The purpose of study 5
1.4 Scope of study 6
1.5 Research question 6
1.6 Significance of the study 7
CHAPTER TWO
Review Of Literature 9
2.1 Definition of distress/failures of a corporate 9
2.2 Causes of business failure 12
2.3 Summary of related reviewed literature 29
CHAPTER THREE
Research design and Methodology 30
3.1 Research design 30
3.2 Area of study 30
3.3 Population of the study 30
3.4 Sample size and sampling procedure 31
3.5 Instruments for data collection 34
3.6 Validity of the instrument 34
3.7 Reliability of the instrument 35
3.8 Method of administration of the research instrument 35
3.9 Method of data analysis 36
CHAPTER FOUR
Data Presentation And Results 37
4.1 Research question 1 37
4.2 Research question 2 40
4.3 Research question 3 42
4.4 Research question 4 45
4.5 Summary of findings 47
CHAPTER FIVE
Discussion Of Results, Conclusion, Implication Of Findings 49
5.1 Discussion of findings 49
5.2 Conclusions 51
5.3 Implications of the study 52
5.4 Recommendations 52
5.5 Suggestions for further studies 53
5.6 Limitation of the study 54
References 55
Appendix 57
CHAPTER ONE
INTRODUCATION
1.1 BACKGROUND OF THE STUDY
Fraud is irregularities involving the use of criminal to obtain and against illegal advantage.
Fraud involving the manipulation of the record and the accounts, usually by the company’s senior officers, with a view to benefiting in some way from the false picture which they convey (eg obtaining finance under false pretences, or concealing a material worsten of the company’s true position)
Frauds, usually by employees, involving the theft, misappropriation or embezzlement of the company\s funds, usually in the form of cash, or of its other assets (such as good held in a warehouse).
Fraud and financial malpractices in many business involving the public sector organisation today contribute mostly to one of the factor that lead to business failure.
In all human endeavour and activities, there are usually stories of successes achievement and failures.
Business are therefore no exception initially, a motive for setting up a company is for economic reasons which are usually taken to be profit maximization objectives in period of booms as was experiences in the mid seventies during the oil boom; making business, including the public sector organizations, thieved in an era of abundance.
In such as era employment production and income were at their peak level and government expenditures at all levels rise considerably without any corresponding rise in productivity.
During this period also, no one complained and managers of our various businesses did not think of means of survival and sufferance.
Efficiency and effectiveness in the use of scare resources were never thought of and there were total absence of research control mechanisms.
Economic planners in such periods, makes unrealistic projections and assumptions they plan to build high ways, sky scrappers, new state capital (or new cities), contracts were awarded induscomminately without the need for detailed cost benefit analysis.
In summary, the sky was the limit for businesses that have access to cheap credits, and investible funds. In such periods, capital inadequacy, under utilization of production capacity, deficiency in aggregate demand for the firm’s product etc, were never heard of during the peak periods.
Contrary, when the hay days were over and the down turns take over the dooms day arrives and business failures becomes the order of the day as a result of adverse macro-economic policies and resulting adverse conditions.
Consequently, expansion is hindered for even the surviving firms. This is the time when company executives/managers, government federal, state and local governments as well as individuals, remember to think of such phrases as viability, belt tightening profitability, growth and survival and better ways or resource planning, control and managements, it is a time when managers/directors of our business firms, public companies/corporations and other governmental organization now thinks of cost reduction and minimization of fraud and financial malpractices which has hitherto plunge such organisation into distressed conditions.
The adverse marco-economic conditions in Nigeria today has attained a dimension that can best be described as “crisis” level. This had led to some drastic measures/programmes being initiated by the government to keep the nation afloat.
Such measures have come in different names at different times, ranging from the belt tightening of the Shagari administration through economic emergency order of the Buhari – regime to the structural adjustment programme (SAP).
As a result of these measures, firms and individuals have found themselves in extremely hard conditions to the extent that some have failed completely, other are stagnated and distressed.
What factors are specifically responsible for such state of affirms of the business firms?
This project is set out to investigate how fraud and financial malpractices can bring a highly profitable organizations into distressed and untimely liquidation.
1.2 STATEMENT OF PROBLEMS
(1) Inspite of the federal government in privatalsing the telecommunication industry, NITEL Plc is still saddled with the problem of bad image arising mostly from fraudulent malpractices by both management and staff of the company
(2) INTERNAL CONTROL: There are inherent weakness in the internal control system of NITEL Plc.
(3) NIEL Plc management does not consider policy or fraudulent cases as strategic in its decision taking.
(4) NITEL Plc has not met with the expectation of its investors as a practiced entity since its privatization.
1.3 PURPOSE OF THE STUDY
1. To fund out the extent of which bad image arising mostly from fraudulent malpractices by both management and staff despite of its privatization.
2. To ascertain the extent to which inherent weakness in the internal control system of NITEL Plc.
3. To find out the extent in which they do not consider policy or fraudulent cases as strategic in its decision taking.
4. To find out the extent in which they do not met with the expectation of its investors as a privatized entity since it privatization.
1.4 SCOPE OF THE STUDY
The scope of this study mainly focuses on fraud and financial malpractices as a leading factors in business failure. The survey is to be carried out at NITAL Plc Okpara Avenue, Enugu in Enugu State.
1.5 RESEARCH QUESTION
For the purpose of this study the follow research questions were asked:
1. To what extent does bad image arising mostly form fraudulent malpractices by both management and staff of the company affect business.
2. To what extent does inherent weakness in internal control system of NITEL Plc contribute to fraud and financial malpractice.
3. To what extent does inability to consider policy on fraudulent cases as strategic in its decision taking brought about business failure.
4. To what extent does damages caused by fraudulent and financial malpractices on the expectations of the investors on their returns.
1.6 SIGNIFICANCE OF THE STUDY
Significance of the study refers to the importance or usefulness of the research to individuals, shareholders, management, potentials investors, suppliers/creditors and all those having one interest or the other on the operations of the business firms.
The ultimate aim of every research is to provide knowledge and information that will bring about a better understanding of the topic under review.
Specifically this project will offer enough information and explanation to the management of NITEL Plc, the government and the general public.
Furthermore, the research findings and recommendations will form a basis to be relied upon by subsequent researcher who may wish to make further inquiries on the issue of fraudulent practices and its effect on business failure.
1. To ensure that good image will arise mostly from fraudulent malpractices by both management and staff of the company.
2. To ensure useful solution of eliminate inherent weakness in internal control system.
3. To make sure that there is consider policy on fraudulent cases as strategic in its decisions making.
4. To ensure that they met with the expectation of its investors on their returns.
HOW TO GET THE FULL PROJECT WORK
PLEASE, print the following instructions and information if you will like to order/buy our complete written material(s).
HOW TO RECEIVE PROJECT MATERIAL(S)
After paying the appropriate amount (#5000) into our bank Account below, send the following information to
08139462710 or 08137701720
(1)Your project topics
(2) Email Address
(3) Payment Name
(4)Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: FRAUD AND FINANCIAL MALPRACTICES AS A LENDING FACTOR TO BUSINESS FAILURE (A CASE STUDY OF NIGERIAN TELECOMMUNICATION LIMITED (NITEL)
