THE OVERVIEW OF LOCAL GOVERNMENT FINANCE IN THE NEW MILLENIUM

By

OKOFU SYLVESTER I.

Presented To

Department of Accountancy

TABLE OF CONTENTS

COVER PAGE` I

TITLE PAGE II

APPROVAL PAGE III

DEDICATION IV

ACKNOWLEDGEMENT V

PROPOSAL VI

CHAPTER ONE

INTRODUCTION 1

BACKGROUND OF THE STUDY 1

STATEMENT OF PROBLEM 2

OBJECTIVE OF THE STUDY 3

SIGNIFICANCE OF THE STUDY 3

SCOPE AND LIMITATIONS OF THE STUDY 4

REFERENCES 4

CHAPTER TWO

LITERATURE REVIEW 5

NEED FOR LOCAL GOVERNMENT 5

LOCAL GOVERNMENT ORGANISATIONAL -

STRUCTURE 7

THE CONCEPT OF FINANCIAL -

ADMINISTRATION 9

DEFINITION OF TERMS 12

REFERENCES 13

CHAPTER THREE:

SUMMARY 14

SUMMARY OF FINDINGS 14

CONCLUSION 15

RECOMMENDATION 16

BIBLIOGRAPHY 20

CHAPTER ONE

BACKGROUND OF THE STUDY

Finance has been a problem facing the government. The government of Nigeria is made up of the federal, state and local government which is preferably called the three times of government. But however, this work is only limited to the local government.

Local government form the third ties of government in Nigeria. The aim of creating local government is to decentralize government so that local government which are nearest to the people will enable this people to participate in development process of their area. Local government is also referred of their area. Local government is also referred to as government at the grassroots level.

To carry out its function, the local government must have readily available finances. This is because the need for finance is very important in any establishment.

In defining what finance is various perspectives from different aspects are recognized:

1. The investor sees finance as the possession of funds when it is needed for investments.

2. The layman understands finance as the volume of money held as cash and cash balance at banks.

3. The academics sees finance as the discipline that studies the science of funds management, which includes the institutions that are involved in sourcing funds such as the money market institutions, insurance market institutions and mortgages market institutions etc.

These guideline helps in generating funds and funds management.

STATEMENT OF PROBLEM

One of the problem facing the local government is that they have limited source of revenue. Apart from revenue accruing from the federation accounts all other source of revenue do not yield much fund. This federation accounts serves as the federal government budget estimates.

In 1996, the vertical sharing from the federation accounts placed the local government on 20.0%.The federation government of generating and distributing revenue accruing from oil and non-oil revenue.

OBJECTIVE OF THE STUDY

The objective of this work is to explain into the hindrance against effective measures undertaken to curtail the low rate of finance in local government.

It will help in ensuring that adequate controls exist over the receipt custody and disbursement of funds, that all its transactions one promptly and properly accounted for and documents and records relating to the financial transaction are accurate and complete.

SIGINIFICANCE OF THE STUDY

This study helps in policymaking and investment. It also serves as a guide to authorities on how to control finance.

After identifying the problems, it would also help in allocating funds to local government by checking its expenditures. This in effect will also help the local government in funds management.

The people at the grassroots will also benefit from the study in solving their needs thereby increasing the standard of living.

SCOPE AND LIMITATION OF THE STUDY

The study will ascertain the source of funds of local government administration.

It would also look into the concepts of financial administration of the local government and its expenditure relating to inadequate funds.