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Thursday, 19 November 2015

ACCOUNTING INFORMATION SYSTEM AS A MEANS OF ENHANCING FINANCIAL MANAGEMENT OF TRANSPORT COMPANY









 

INTRODUCTION


1.1 BACKGROUND OF THE STUDY


The Nigerian Railway Corporation (NRC) has been in existence for years. It is regarded the largest transport corporation in Nigeria and has a high network operations.

The Nigerian railway corporation is One Hundred and Fourteen years (114) old and it runs a unilaterally designed track system of 1067mm charge gauge. Only 30km of its track distribution is in double track and that is within Lagos area.

Nigerian Railway Corporation actually commenced rail business activities with the construction of the first rail line from Lagos to Ibadan 193m between 1998 and 1901. By 1964 when the construction of 640km Kano-Maiduguri rail line, then known as Bornu extension, was completed, the present core of the railway network hard been put in place.


Presently, the railway system is made track kilometers. In addition to this is the 19km 1067mm gauge extension from Port-Harcourt to one deep sea port and the 277km standard gauge rail construction  of 1435mm from Ajaokuta to Warri.

Nigerian railway was transformed from its first and initial name.

“Government                               Department   of   Railway”   t

1955 through the instrumentality of the statutory act of parliament which, apart from changing the name of the railway industry in Nigeria, equally conferred on it absolute monopoly as the institution recognized by law to carry out railway services.

The general aim and object of the statutory act of parliament of 1955 for Nigerian railway is to recognize same as carryi passenger and goods in a manner that will offer full value for money, meet cost of

operation, improve market share and quality of services, ensure safety of operation and maximum efficiency, meet social responsibility in a manner that will meet the

requirements                                   of   rail   after,   trade,   comm


The headquarters of the corporation is located at Ebute-metta in Lagos state while the entire network is for administrative convenience, divided into seven autonomy districts viz.Lagos (Ebute-Metta junction), west (Ibadan), north (Zaria), east Enugu), North-west (Minna), north- central (Kanfanchem) and North-east (bauchi)





The railway system has been undergoing same rehabilitation and modernization with the full political and financial support of the federal government through the federal ministry of transport. The rehabilitation of the railway system includes track spot removal of Lagos to Kano and Maiduguri to port-Harcourt, supply of 25 new locomotive engines from brazil south America to boost the registry motive power base of the corporation, up grading of the signaling and telecommunication system from manual to semi automatic, as well as rehabilitation of carriage and wagon workshops, re-equipping the workshops, supply of service support (spare part consumables), strategic rebranding of the corporation, rehabilitation of stations and marshalling yards inter alia.

Equally, new railway lines are being constructed in standard gauge (1435mm). These include: Ajaokuta-Warri of 277km, Kaduna-Abuja (Idu) line of 186km while the scope of work for Lagos-Ibadan segment is under review together with its cost implications.

The Nigerian Railway Corporation has contributed amenably towards the improvement of social life and the development of the national economy. This is through to be extended to every part of the country that is the haven stages which will lead to permanent prosperity confident was such an ultimate triumph of the railways.





However, regardless of the huge success made by the corporation, it is facing a hard time.

1.2 STATEMENT OF PROBLEMS


Nigeria Railway Corporation which dominated the transport sector of the economy in the sixties is presently being delegated by other means of transport such as road transport, sea, and air transport. The corporation has lost her passengers and freight mainly to road transport; this is because of inability of the corporation to compute effectively in order to meet the age longed challenges.

Ordinarily there should have been growth in both road and railway transport but the railway transport seems neglected. The truth of the matter is not just neglected, but a problem of cash flow difficulty and management these affect the purchase of spare parts, repair, payment of salaries, inadequate infrastructure support and enhance service rendering.

Given the above condition of the Nigerian Railway Corporation in the nations transport industry, the problem which looks for detailed analysis and solution includes the following questions.

1.     Is the accounting information used in the corporation adequate for managements short and long term plans?

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