DEPARTMENT OF BANKING F& FINANCE, TOPIC: FISCAL INSTRUMENT, A NECESSITY FOR ECONOMIC DEVELOPMENT
FISCAL
INSTRUMENT, A NECESSITY FOR ECONOMIC DEVELOPMENT
(A
CASE STUDY OF FIRST BANK OF NIGERIA PLC)
TABLE OF CONTENT
Title Page i
Certification ii
Dedication iii
Acknowledgement iv
- v
Tables of content vi - viii
CHAPTER
ONE
INTRODUCTION 1
- 2
1.1 Historical Background of first Bank 2 - 7
1.2 Research Question 7 - 8
1.3 Statement of the Problem 8 - 9
1.4 Significance of the Study 9 - 10
1.5 Scope of the Study 10
1.6 Limitation of the Study 10 -
11
1.7 definitions of Terms 11 - 14
CHAPTER
TWO.
LITERATURE
REVIEW 15
2.1 What is Fiscal Instruments 15 - 19
2.2 What is Budget 19
- 26
2.3 Theories of Economic Development 26 - 33
2.4 The Necessity of Fiscal Instrument in
Economic development 33 - 35
CHAPTER
THREE
RESEARCH
METHODOLOGY
3.1 Description of Area of Study 36
3.2 Population for the Study 37 -
38
3.3 Sample and Sampling Techniques 38 - 40
3.4 source of Data 40
CHAPTER
FOUR
PROBLEM
AND PROSPECT OF FISCAL POLICY IN
NIGERIA 41
- 44
4.1 Data Analysis and Presentation 44
4.2 Procedures for Statistical Analysis of Data 45 - 55
CHAPTER
FIVE
SUMMARY
OF FINDING, CONCLUSION AND RECOMMENDATION
5.1 Summary 56 - 60
5 2 Conclusion 60
- 61
5.3 Recommendation 61
- 63
Bibliography 64
- 65
CHAPTER ONE
1.0
INTRODUCTION
The
level of development is one of the yardsticks which is used as a basis of
national comparison.
Everybody
wants development, i.e. absolute economic change and improved standard of
living. It discriminates among countries of the world, towards this end, we
have developing’ and less developed countries (LDCS) of the world. To attain a
Full level of development, a country should employ the fiscal policy through
its instruments which are basically taxation and government expenditure.
Fiscal
policy is that of government overall economic policy which is aimed at
achieving the government economic objectives through the use of fiscal
instrument of public revenue and public spending and the budget deficit or
surplus. The policy has a significant role to play in the economic development
and it serve as means of influencing the economic activities of the country
where it is used.
The
benefit derived from the used of fiscal policy are numerous it can be use to
control the pattern of consumption, it is a mechanism for providing incentives
for production it is also used as an instrument to fight inflation and
deflation and a means to achieve equitable of income in an economy, it is the
tools for the economic development.
HISTORICAL BACK GROUND OF FIRST
BANK
First
bank of Nigeria plc, under the umbrella of First Bank of Nigeria plc which is
located or situated at plot 2 Abebe village road iganmuu, Lagos, it is a
lending banking institution in Nigeria with over a hundred years of banking
experience industry and behind it. Founded in 1894 by a shipping magnate from Liverpool, sir Alfed Jones.
The bank commence as a small bank in the
office of Elder Dumpster and company in Lagos.
Today the first bank of Nigeria
has diversified into a whole range banking activities and service including
Commercial, Merchant and international banking and has became historically, a
potential factor in the development of the country.
It
was incorporated as a limited liability company in London
on March, 31 1894 with head office in Liver-pool under the corporate name of
the bank of British of the West Africa. With a
paid – up capital of 12,000 pounds sterling is started business after it had
absorbed its predecessors. The Africa Banking Corporation, which was
established earlier in 1892. The signaled the beginning of the pre-eminent
position which the bank was to established in the banking industry.
The
First Bank of Nigeria
has experienced phenomenal growth over the years, with a share capital of N55
.6 million in 1980 which as’ rises to N215.2 million. In 1995 and depose base
of N23.3billion.
When
the bank began operation in 1894, it has a staff of six comprising fully
Nigerianzed. Thus, of course have been the result of planning are
responsiveness to the yearning of the Nigerian people and government as well as
the banks determine to identify with the aspiration of the country in its
March towards
national development.
In
pursuance of these, the banks have had good cause of continually adjust its
organizational structure and corporate entity.
Beginning
with a change of its name to the bank of West Africa in 1957 reflecting the
movement towards independent by Nigeria
The
bank was incorporated locally in 1969, to become Standard Bank of Nigeria
Limited.
This
was in response to the dictated of the companies’ decree of 1968, there after,
the active participation of Nigeria
in the management of the bank become a corporate policy. Further changes in the
name of the bank were made in 1979 and 1991 to fist Bank of Nigeria Limited and
first Bank of Nigeria Plc respectively.
The
enhanced level of operation and need to response to increasing competition have
necessitate a considerable re.-organization of the bank. This began seriously
in 1985 when a
New
decentralized structure was introduced after a detailed analysis of the
previous operational and reporting structure.
The
fine turning of that structure in 1992 had hand. somely paid off Aggressive
Banking decentralized decision making process and response directorate system
have become the pillow of the Bank current efficient operation mode -in
addition, computerization and efficient information management system have been
introduced into the Banks operations in order to facilitate rapid response to
customer services.
The
bank has maintained its leadership in financing long-term development of the
economy which starts in l947 to date the bank boasts of a diversified loans portfolio
and credit facilities to various sectors of the economy.
The
banks banking record is unmatched by any other bank while its agricultural
credit facilities and granting of loan to indigenous enterprises through
community farming loan scheme have given peasant farmers and indigenous
enterprises bank credit respectively.
The
bank foreign partners, the standard chartered bank Africa plc have reduced
their share holding to 9.5% following the often of 120,941,195 share to the
Nigeria public, thus bringing the equity holding by Nigeria to 90.1%.
The
bank has won the coveted stock exchange award as the best financial reporting
in the banking sector for several years.
1.2
RESEARCH QUESTION
Questionnaire
were administered and given to respondents. The questionnaires were dully
completed back by the researcher.
The
following research questions are designed to suit this particular research
work.
H0: Taxation and public expenditure are not us
positively to attain economic development.
Hi: Taxation and public expenditure are used
positively.
Ho: The Government is not enjoying his citizen
co-operation tax payment.
Hi The Government enjoys his citizen
co-operation.
1. Does fraud occur in your organization?
ii. On which form frauds take in your
organization?
iii What is the role of auditing in your
organization?
iv Has your organization been able to detect
fraud?,
v. what are the causes of fraud in your
organization?
vi.
What measure of control does the
auditor recommend for detecting and controlling of fraud in your organization?
1.3
STATEMENT OF THE PROBLEM
Despite the
employment of fiscal instrument adequate pursuance of fiscal policy is not
enhanced. This was therefore stagnate economic development. How can fiscal
instrument be use to bring about development? Why does Nigeria refuse to
Develop, despite the
use of fiscal instrument’?
Fiscal
instrument, a necessity for economic development.
Have been playing a
vital role in the national economics growth, development and social
mobilization will be discussed fully in this project and some of the
constraints facing in economics growth
This work will be also extended to the
problems and prospect of fiscal implementation. It will also cover the
effective and efficient use of economic policy in Nigeria.
1.4
SIGNIFICANCE OF THE STUDY
The
significant of this research or lies in providing the public with a brief but
clear picture of the problems, prospects and some suggested solution to the
problem facing fiscal instrument, a necessity for economic development. This
research work will be of paramount to the cities (student and non-student] who
intends to broaden their knowledge on government fiscal policy instrument and
how these policies can be used for effective development of the economic
It
will also be useful to the government to plan proper implementation of fiscal
policies and system that suit the present situation. It will also encourage
institution to contribute to moral development by highlighting area where
fiscal instrument, a necessity for economic growth.
1.5
SCOPE OF THE STUDY
The
scope of the study covers the fiscal instrument, a necessity for economic
development.
Thus
research work shall cover full explanation. The two important fiscal policies
instruments Are taxation and government expenditure. The importance of those
two fiscal policies instruments will also be included as part of research work.
The
study is also design to know how First Bank Plc, Ilorin branch enhance fiscal instrument
towards better economic development.
1.6
LIMITATION OF THE STUDY
As
the main course of my study is the fiscal instrument, a necessity for an
economic development.
There
are some problem encounters during my course of study, which is basically on
finance. Insufficient fund to obtain the necessary material for the research and
to keep appointment on schedule hampered the courage. Furthermore, time is also
one of the factors that marred the efforts in developing this report due to
allocation of’ time to other assignment.
1.7 DEFINITION OF TERMS
It
become necessary for the research to define some of the key words in this
project works which statistical in nature. Statistical method of date
collection will include primary and secondary source of date collection.
ECONOMIC DEVELOPMENT:
- This is a complex phenomenon with many aspects, hence it is difficult to
define precisely, however, it can be roughly defined as the process of change
in a society which leads to increase in the standard of living and welfare of
the masses of the people. Economic development combines economic growth with
other changes in society such as change in the structure of the economy in the
level of poverty and unemployment and in the degree of income inequality.
It
is very important to understand the nature and uses of primary and secondary
source of data. Information is generally characterized as being either primary
or secondary in nature depending on the purpose for which the dates were
originally collected.
The
term “PRIMARY” and “SECONDARY” don’t in any way as importance.
PRIMARY DATA:
- are originally date gathered by the researcher for the project at hand.
SECONDARY DATA:
- do dates already existing in printed form having been previously collected
for other project different from one previously in question.
None
is more important than the other through they have relative advantages and
disadvantages.
MAIN SOURCE OF PRIMARY AND
SECONDARY DATA
Primary
data are those dates which have been observed arid recorded by the researcher
for the first time to her knowledge.
In
other words, they are those originally data gathered by the researcher
expressly to solve the problem at hand. They are date assembled for the first
time and therefore are not published.
When
a researcher makes a survey to gather information on a particular issue, to
asked questions through personal interview, observation, discussion,
questionnaires generally, information obtained through personnel contact or by
sending question is called primary information. The data secured from primary
sources are regarded as raw because they have not n used by any researcher or
have not been subjected to interpretation or analysis by others.
Secondary
data are those data which others have already recorded on the subject matter in
various documents including k, magazine, journal, periodicals, reports,
bulletins, articles, pamphlets, newspapers and government documents
CHAPTER TWO
2.0
LITERATURE REVIEW
For
through understanding of the project, it is essential to review literature of
tested authorities and professional in relation to subject. Fiscal instrument,
a necessity for economic development. With reference to first bank of ‘Nigeria
plc Ilorin Branch Kwara state.
2.1
WHAT IS FISCAL INSTRUMENT
Fiscal
instrument are specifically taxation, Budgetary, Measures, Subsidies,
(Government, Expenditure e.t.c
Government is charged
with two specifies policies which are monetary and fiscal policies, fiscal
policy is that, part of government overall or generally policies which is aimed
at achieving the government economic objectives through the use the fiscal
instruments of public revenue and public spending and the budget or surplus.
Since government fiscal policies affect
the rate of inflation, the level of unemployment, the taxes we pay, and the
environment in which we live, it is important that we understand them. Infact
it is doubtful that there is even one of use whose life has not been
significantly touched by one or more of these policies.
R.O.Adebayo
(2009) defines fiscal policy” as the direct policies of the government which
involve manipulation of parameters that will directly affect government revenue
and expenditure.
The
elements of fiscal policies include taxation, national budget and planning etc.
According to Yusuf
and BabitaK.A (2005) fiscal policy involves the use of various forms of
taxation, budget as well as government spending. Government can increase a tool
to control inflation, hence price of goods and service will fail.
Paul .A. samuelson and William
.D.Nordhaus (2005) define fiscal policy as a government expenditure and
taxation. Government expenditure influences the relative size of collective
spending and private consumption. Taxation subtracts from income, reduce
private spending and affect private saving, in addition it affect investment
and potential output. Fiscal policy is primarily employed today to affect long
term economic growth through its impact on national saving and on incentives to
work and save.
According
to John Orjih (1996) define fiscal policies as a government policy which is
designed to change the level of government expenditure or varying the level of
taxation or both for purpose of achieving some desired economic objectives.
Fiscal policy is implemented through change in the budget.
According to
K.A.lshola (2005) define fiscal policy as the use of government tax and
expenditure policies to regulate the economy. If the government wants to
control inflation it can increases taxes and reduce its own expenditure.
S.Lola
Akintelure (1998) fiscal policy refers to the government plan of action
concerning the raising of revenue through taxation and other means deciding the
pattern of expenditure to be applied.
Many of the fiscal
policies tend to direct the economic activities in the country.
Micheal.J.art
(1972) defined “Policy” as the rate of taxation
The former itself a
component of aggregate demand the latter is a way of affecting consumers
expenditure so as to achieve a
Particular goal.
Keynes
in this text argued the he economy would be restored to its pre -depression
employment level if government could be fiscal this would expand economic
activities, create new jobs and new income.
This
will have the resultant effect of creating more demand for goods and services
and have this tendency of drawing idle capital goods back to use. Unemployment rate
would be reduced and those already employed could get new income which will
generate demand for consumer goods. Industries will be restricted and all
machinery put into this use can new be used.
According
to the Encyclopedia Britannica, fiscal policy is measures employed by the
government to influence economic activities especially by manipulating the
level and allocation of fiscal instruction which are basically taxation and
government expenditure. Also the term fiscal policy refers to government policies
of taxing and depending designed to affect the equilibrium level of national
income.
2.2
WHAT IS BUDGET
BUDGET:
- this is a premeditation government income and expense for a particular fiscal
year- this important economic signal is prepared once in a year to regulate the
economy of a particular country.
BUDGET
SURPLUS: - this is a situation when the planned government
receipt in a particular year is more than the planned expenditure for that
particular year. A budget can be deliberately planned to be surplus in the
period.
BUDGET
DEFICIT: - a budget is said to be deficit when
the planned expenditure for a particular fiscal year. Budget deficit is also
necessary in controlling the economic situation. TAXATION: - taxation is a compulsory very paid to the government
which is different from payment for specific service or penalty from payment
for specific offence. Tax could be paid on the level of income or a particular
good service. Tax is imposed by law. It can be direct or indirect as the case
may be it is an essential tool of fiscal policy which could regulate the
economic situation.
TAX
BASE AND TAX RATE: - tax base is the particular object
that is being taxed. It can be income in case of direct tax and goods and
services in case of indirect tax. Tax rate is the amount of money which is paid
as tax. It can be inform of a certain percentage on the tax base or
predetermined amount of money.
PROGRESSIVE,
REGRESSIVE AND PROPORTIONAL
TAX:
- A tax which takes larger percentage of ones income as the income increase is
known as progressive tax. It is also know as PAY AS YOU EARN (PAYE). The more
you earn, the more you pay. In progressive form of taxation the percentage of
the income to be paid as taxation increase as the level of income increases. It
favors the higher income earner; a goods example is the pool tax.
It encourages people
to aspire for higher post. Regressive tax system this is a tax system in which
the tax liability decreases with increase tax base. Proportional form of
taxation will take equal percentage of income on every tax payer. This is when
every tax payer will be asking to pay the same percentage of their income as
tax.
TAX
EVASION AND TAX AVOIDANCES: - tax evasion is the
deliberate or intentional attempt used in order not to pay tax at all. Tax
evasion is a grievous offence in Nigeria tax system. Tax avoidance
in the using of the advantages in the loopholes of tax collection or law with a
view to not paying required tax.
Tax avoidance is also
occurs when a tax payer takes a perfectly legal course to keep down the amount
he has to pay in tax or takes the advantage of loopholes in the tax regulation
e.g. declaring that he has more that the actual member of children he has
dependent relative when actually he has none.
TAX
INCIDENCE AND TAX SHIFTING: (a) TAX INCIDENCE:
Incidence of a tax is
defined as its final resting place. It is to be seen and judged in terms of the
money burden of the tax. In other words the incidence of a tax is upon those
economic units which finally bear the money burden of tax and which are not
able to pass it to others.
(b) Tax shifting: - The term tax shifting
mean the process by which the economic agent has bears the initial burden of a
tax transfers a whole or part of the burden to another economic agent. This can
be in two ways
i. forwarding shifting:- through sales
transactions.
ii. Backward shifting: - through purchase
transaction. PUBLIC EXPENDITURE: -
This is the amount spent by the government to provide for the essential
services needed by the citizen. The major source of revenue derive in the
taxation, government expenditure is grouped under four headings.
THERE
ARE AS FOLLOW:
i. GENERAL
ADMINISTRATIVE CHANGE:-These are the government expenditure on the general
administration of the country. It includes expenditure on such as civil
service. Police military and pare- military forces and government department.
ii. ECONOMIC
SERVICES: - Expenditure incurred on economic actives such as agricultural,
fisheries, forestry, transport, and communication, trades and industries and
establishment of market and economic center.
iii SOCIAL
AND COMMUNITY SERVICE: - These are the government expenditure on education,
recreational facilities, health, fire protection, and other social amenities
iv. TRANSFER: - This
includes expenses incurred by the government indebt servicing, pensions and
gratuities unemployment e.t.c.
v. MONETARY
POLICY: - this is the regulation of economy with the use of money supply.
It is also known as an intentional action undertaken to achieves the government
objectives of the disposal of central bank. It goes side by side with fiscal
policy. Some of the objectives of the monetary policy included.
·
Maintenance of a found and stable
currency.
·
Provision of found required to finance
economic development.
·
To achieve balance of payment
equilibrium.
·
To control inflation
·
To maintain price stability
Tariff
these are set of tax levied on imported goods upon the need of the government.
Government can increase it to protect infant industry from being collapse as to
discourage the importance of some goods.
1. Infant
industries: These are indigenous industries producing locally made goods
and are not ripe enough to complete with foreign companies abroad.
ii. Fiscal year: This is a period of one
year or twelve months which an organization or country prepares her account,
for instance; Nigeria
fiscal year starts in January and ends December every year.
iii Tax
deposit: this is chargeable on the interest on the bank deposit. For
example, if Mr. X deposits N 5,000 and it yields certain amount out of the
interest and set it to tax office
iv Fiscal
Drag: The increase in full employment surplus caused by economic growth
which in the absence of tax charge is automatically diverted to the government.
2.3
THEORIES OF ECONOMICS DEVELOPMENT
Economic development
is defined as a rapid improvement in national income and national output.
Economic development is which broader term. It is a process essentially where
by the real per capital income increase over time (i.e. economic growth) capital
with change in structure, attitudes development in administrative system,
quantities improvement of labour a rational system or resources allocation and
distribution of income conductive to national integration.
OBSTACLES
OF ECONOMIC DEVELOPMENT
It
is commonly noticed that some countries are so poor while some are very rich.
Why is this so? Below are few of the obstacles that some economists believe
hinder economic development in the developing countries.
1. POLITICAL INSTABILITY: - perhaps the
greatest obstacle to the less developed countries would see to lie in their
political situation. Individuals of both developed nations and LDC’S sometimes
do not invest in business because they are afraid either that the current
leaders of an LDC’S will be toppled and thrown out of office or the government
may expropriate private property. Another political obstacle is the lack of a
political leadership, group or committed body that would ensure rapid
development in the developing countries
2. SCARCITY OF CAPITAL:-For some economists, the greatest obstacle
to the economic development of the less developed nations is shortage of
capital which is the consequence of law income-law savings cycle. The shortage
of capital is also responsible for under development of agriculture, industry
and commerce and also under-exploitation of natural resources such as
petroleum, which calls for heavy capital investment.
3. HUMAN RESOURCE CONSTRAINT:-The role of
human resource is very crucial as for economic development is concerned. The
LDC’S lack people possessing critical skills and knowledge required for all
round development of the economy. Under development human resources are
manifies in low labour productivity and customary value. It is a radical change
in social administration and the customs and belief of the people. When
development has occurred over years, it resulted into what is known as economic
growth. There are certain elements in development these are:-
Capital formation
arises when some portions of the present income are saved and invested in order
to aurgment future out put and income. Capital formation includes two types of
capital: physical and human capital. physical capital such as tractor or
machines and human capital such as skills and knowledge, increase the ability
of an individual to produce (that is there is a predictable relationship
between capital formation and labour productivity) for example modern farmers
produce more than their grandfathers largely because they have certain physical
capital goods such as tractors that their grandfather didn’t have and they know
much more about the service of farming. In short they possess more physical and
human capital than their grandfathers.
·
Technological
Advance:- technological advance are said to result from new
and imposed ways of accomplishing task as farming, making clothes technological
advance make it possible to obtain more output from the same amount of
resources for example a company that uses computers and sophisticated machines
would produce more than a company that do not use either.
·
Natural
resources: To many economists natural resource are important
source of economic growth they often think that countries that have plentiful
supply of natural resource experience economic growth where as countries that
are short on natural resource do not, infact some countries with abundant
supply of natural resource have experienced rapid growth (like the united
states of America) and some have experienced no growth or only slow growth
(like Jamaica and Mali).
·
Human resource, labour, supply,
education discipline and motivation etc.
·
Economic development are not just
attained on a platter of good, it is determined by the following factors
contribution to it.
They are as follows:
Ø Higher
per-capital income.
Ø Lower
rate of illiteracy.
Ø Lower
population growth rate.
Ø High
rate of industrializations growth.
Ø Political
stability.
Ø Higher
rate of’ employment opportunity.
If
any of these factors contributed negatively to economic
Development, the
meaning of development will be distorted.
Economic development
is pertinent to some country of the advanced world. For example, united state
of America, while other
countries in West Africa (predominantly) are
under development.
STAGES
OF DEVELOPMENT
Any
development country of the world proceeds along the following stages of
development according to w. rosters, the stages are: TRADITIONAL SOCIETIES: —
this is tire crude or unrefined stage at which any society Finds itself. This
is always refers to the pre- historical of some societies.
ii. PRE- CONDITION FOR TAKE OFF: - This is
regarded as all the necessary steps to be taken top graduate from the
traditional societies. This conditions involutes education, economic,
Mobilization, steps towards political stability.
iii. DRIVE
TO MATURITY: - It is the next step after the pre-condition for taking off
is met. It is only when all there condition are met, that we say a country is
driving to maturity.
iv. MASS
CONSUMPTION: - This is the final stages of development. It involves the
demonstration of those sign as high per-capital income, lower population growth
rate, higher of technology among others.
2.4
THE NECESSITY OF FISCAL INSTRUMENT IN ECONOMIC DEVELOPMENT.
Fiscal instruments
are the instrument used by the government to execute her fiscal policy. The role
of fiscal policy in dispensable in the history of any economic development.
Government needs money for proper implementation of’ her economic policy. The
two fiscal instruments, which are taxation and government expenditure, are the
county will remain in a stagnated level of growth.
Some
of the necessities of fiscal instruments in economic development are:-
1.
It is used to protect infant
industries from union’s competition.
2. It is used as instrument to redistribute
income (taxation):
3.
It is also used to attain balance of
payment equilibrium in international trade.
4. It is no important sources of government
revenue.
5. Fiscal instruments can be used to boost
production
6. It is also used to attain economic and
prices stability.
REFERENCE
R.O.ADEBAYO
(2009) Element of Banking Olad Publishers, page86
YUSURA.
AND BABAITA K.A (2005): Principles of Economic Volume 2 Clad Publisher pg 56
PAUL .A. SAMUELSON
AND WILLIAM .D.NORDHESUS (2005).
Economic
Eighteenth Edition Great Britain D.P Publication pg 413-414.
JOHN ORJIH (1996)
Element of Banking flock Communication
Nig.
publisher’s pg 202.
K.A.
ISHOLA (2005): Macro Economic, Trust in God Publication plc 118
S.
LOLA AKINTEURE (1998) Comprehensive Economic, A. Johnson Publisher.Ltd Pg 220.
MICHEAL.J
.ART (1 972) Macro economic Edition, London, Africa Publisher Ltd.
CHAPTER
THREE
3.0 RESEARCH METHODOLOGY
This
can be define as the systematic and objective’ analysis and recording of
controlled observation may lead to development of generalization, principle or
theory resulting in predictions and possibility of ultimate control of events.
The selection of a primary method or approaches of investigation of a given
problem is an important decision for a researcher the method or approach use in
this project is” DESCRIPTIVE RESEARCH
METHOD”.
3.1 DESCRIPTION OF AREA OF STUDY
The
research work focused mainly on government established both for the purpose of
collecting data in First Bank of Nigeria plc Ilorin branch are selected. The junior and
senior staffs were involved in other to see how fiscal policy can really b
rings about development.
3.2 POPULATION FOR THE STUDY
The
population in this study is restricted to staff in accounting department and
other staff form other department and customers of the First Bank Nigeria Plc.
The accounting departments consist of 15 staffs and will 5 staffs where from
other department making 20 peoples and over two thousand customers open were
operating current account in the bank. Out of this customers, the data of (10)
ten customer were given. The stratified random sampling is adapted to sample
out of the element from the population.
Each
customer was takes from each Stratum and each data strata consist of element or
stratum or data of two hundred customers. At first bank Nigeria plc, the chief
Accountant, Auditor, bank manager and every other member of staff in the
department were interviewed.
Also
the management of’ strata as it is done in the bank’s
File
is hierarchically explained below.
Personal
I - 001 to 200
Personal
2- 201 to 4004.
Personal
3 - 401 to 600
Personal
4 -601 to 800
Personal5-801
to 1000
Personal
6 - 1001 to 1200
Personal
7 - 1201 to 1400
Personal
8 - 1401 to 1600
Personal
9 -1601 to 1800
Personal
1 0 -1801 to 2000
3.3
SAMPLE AND SAMPLING TECHNIQUES
The
procedure for drawing samples from population is called
“SAMPLING”
Sample
can be defined as part of the population that is selected for the study since
in most statistical research; it is very difficult to study the whole
population.
Sampling
can be defined as a list of the whole population from which the particular item
for population might be too large (in most cases) to study then we make use of
sample which will represent the whole population.
Sampling
saves money, effort and time and the result under sampling is more accurate
than when the whole population is considered.
The
random sampling method was used. Random sampling is the most fundamental method
of probability sampling. In this type of sampling every individual have the
enhance of being selected.
The
reason being that every individual the banking industry possesses the
characteristics of the general population.
34
SOURCES OF DATA
First
Bank Nigeria Plc was visited a weeks for four weeks. The questionnaire was
distributed randomly to office in various selection of the Bank.
CHAPTER FOUR
4.
O PROBLEM AND PROSPECT OF FISCAL POLICY IN
NIGERIA
THE PROBLEM OF FISCAL POLICY
There are many
problems facing the proper implementation of fiscal policy and ultimately
hinder the efficiency of fiscal instrument in Nigeria, some of these problems
are:
a.
PROBLEM
OF IMPLEMENTATION: Nigeria is characterizes with good
policy, but the way of implementation is the problem some worsen economic trend
is as a result of bad implementation.
b. PROBLEM OF MATERIAL
: Some infrastructural facilities that could be useful for implementing
economic policy might not be available, for instance, tax collection involve
playing good road to the designated collecting area. If the area is not
accessible, it will affect the tax collection.
c.
THE
LEVEL OF EDUCATION: Education of our people seriously
impeded our fiscal policy implementation of fiscal policies are completely
unaware because of their literacy. Tax collection, for instance are difficult
because those that will pay it are not co-operating.
d. UNWILLINGNESS TO PAY:
Taxes which is the major source of government revenue is not forthcoming
potential source of government revenue, but how to activate the payment is the
major problem because many people that are suppose to pay the tax will
definitely dodge the payment of the taxation.
e.
FRAUD
AND PUBLIC EMBEZZLEMENT: If the people swallow their pride to pay the tax,
the money can be diversified into personal consumption. Therefore, most of the
government projects are paper implemented without an actual implementation of
the policy.
f.
POLITICAL
INSTABILITY: Another problem facing fiscal policy
is the political instability of Nigeria
government. Some administration with have nearly finish the executive of their
policy when there will be a change in the seat of government
All these greatly affect fiscal policy
implementation.
THE
PROSPECT OF FISCAL POLICY
Despite
all the problem that faces fiscal policy in Nigeria, there is a great future
awaiting it and this is going to be favorable if the government can try as much
as possible to change the way of its policy implementation.
Besides the proper implementation,
proper provision of facilities, political stability and adequate level of
education should be enhanced.
For instance, an economy with depression
definitely, the government would set up same economic policies which have some
considerable effect o n business i.e. creating business opportunities for
unemployed to make the employed self employed. Making business organization to
be able to expend more rapidly etc.
4.1 DATA REPRESENTATION AND ANALYSIS
“Fiscal instrument a necessity for
economic development” the analysis phases of the research work is the frame
work which specifies the types of data collection procedure, presentation and
the analysis of the data.
If this is correct, it will ensure that
the information gathered is consisted with the study objectives and the data
collected by accurate and economical procedures.
Through the data to
be analyzed is application in the entire Kwara
State but all information restricted
to Ilorin
alone.
4.2 PROCEDURES FOR STATISTICAL ANALYSIS OF DATA
Data presented is tabulated in order to
make it comprehensive enough and be easily studied according to response.
The responses are also based on
percentage for easy analysis and tables used for easy expression.
1. QUESTION
1: HAS YOUR ORGANIZATION BEEN ABLE TO DETECT FRAUD?
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
7
3
|
70%
30%
|
|
Total
|
10
|
100%
|
Source: Survey questionnaire 2011
From
the table above, 70% of the respondents agreed that fraud cause were detected
which 30% disagreed that fraud will not be able to be detected in their
organization.
2. QUESTION
2: DOES AUDITING PLAYS VITAL ROLE IN YOUR ORGANIZATION
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
10
O
|
100%
0%
|
|
Total
|
10
|
100%
|
Source: Survey questionnaire 2011
From
the table above, we can see that 100% representing 10 people agreed that
auditing play a vital role in their organization.
Not this alone, auditing also play a
significantly a receipt and payment,, cash books are maintained and show arrive
and fair view of it financial position and correctness of the accounts are not
tampered by fraud and that should have been detected in the cause of normal
audit.
3. QUESTION
3: DOES FRAUD OCCUR IN YOUR ORGANIZATION?
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
9
1
|
90%
10%
|
|
Total
|
10
|
100%
|
Source: Survey questionnaire 2011
The
table above shows that 90% of people agreed that fraud occurs in their
organization and not only in government establishment. The First Bank of
Nigeria PLC, Ilorin Branch is aware of this and several measures have been
taken to detect and control the occurrence over the years. Many dishonest
officers have been dismissed for one act fraud or the aware of fraud and have
involved measures to detect and control fraud in their policies.
4. QUESTION
4: HAS THERE BEEN ANY WAY IN WHICH TAKE PLACE IN YOUR
ORGANIZATION
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
8
2
|
80%
20%
|
|
Total
|
10
|
100%
|
Source: Survey questionnaire 2011
From
the table above, 80% out of the respondents agreed while 20% unagreed. Some of
the respondents said fraud takes place in their organization through the
following. Misappropriation of item falsification of account omission of items
and embezzlement of cash.
5. QUESTION
5: IS THERE BEEN ANY CAUSE OF FRAUD IN YOUR ORGANIZATION
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
7
3
|
70%
30%
|
|
Total
|
10
|
100%
|
Source: Survey questionnaire 2011
In
the table above, 70% representing the people that agreed on the causes of fraud
in their organization. While 30% disagreed on the cause of fraud in their
organization.
These tables also indicate that workers’
living above their income, lack of incentives to workers and social economics
condition of the country contributes to fraud. According to the agreed
respondents.
6. QUESTION
6: DOES AUDITOR HAVE ANY MEASURE FOR DETECTION PREVENTION OF FRAUD IN YOUR
ORGANIZATION
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
7
3
|
70%
30%
|
|
Total
|
10
|
100%
|
Sources: Survey questionnaire
2011
From
the above table, 70% agreed that through vouching receipt of payment, internal
audit routine checking and internal control system fraud can be measure, while
30% disagreed that audition cannot detect and prevent of fraud in their
organization.
7. QUESTION
7: HAS THERE BEEN ANY PROBLEMS ENCOUNTERED BY THE FIRST BANK OF NIGERIA PLC IN
DEALING WITH THEIR CUSTOMER WHO ARE ILLITERATE?
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
9
1
|
90%
10%
|
|
Total
|
10
|
100%
|
Source: Survey questionnaire 2011
The
table above shows that 90% representing 9 people out of the total respondent
from the department are too intricate for their question, while 10%
representing 1 person out of the total respondents disagreed with problem
encountered their customers who are illiterate.
8. QUESTION
8: DOES YOUR CUSTOMERS ADEQUATELY MOTIVATED
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
7
3
|
70%
30%
|
|
Total
|
10
|
100%
|
Sources: Survey questionnaire
2011
From
the above table, 70% representing 7 people agreed that there are adequately
motivated their customers. While 30% disagreed therefore, we can motivate our
customers.
9. QUESTION
9: DO YOU THINK THE COMPUTER REDUCES WORK OF AN AUDITOR?
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
6
4
|
60%
40%
|
|
Total
|
10
|
100%
|
Sources: Survey
questionnaire 2011
From
the above table, 60% representing 6 people out of the total number of
respondents support the opinion that the computer reduces the work of an
auditor, while 40% representing 4 people out of the respondent are against the
view of the above.
10.
QUESTION 10: DOES THE COMPUTER
INCREASE THE BANK PATRONAGE?.
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
7
3
|
70%
30%
|
|
Total
|
10
|
100%
|
Source: Survey questionnaire 2011
From
the above table, 70% of the total respondent agreed that the computer increase
the bank patronage, while 30% disagreed with the computer increase the bank
patronage.
11.
QUESTION 11: DOES THE COMPUTER IMPROVE
THE MANAGEMENT OF BANKS TOWARDS DECISION MAKING?
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
7
3
|
70%
30%
|
|
Total
|
10
|
100%
|
Source:
Survey questionnaire 2011
From
the above table, 70% out of the total respondent that the computer improve the
management of the bank toward decision making, while 30% were disagreed that
the computer improve the management of the bank towards decision making.
12.
QUESTION 12: HAS THERE BEEN ANY
IMPROVEMENT IN ECONOMY THROUGH THE USE OF FISCAL INSTRUMENT
|
RESPONSE
|
NUMBER OF
REPONDENTS
|
PERCENTAGE
|
|
Yes
No
|
6
4
|
60%
40%
|
|
Total
|
10
|
100%
|
Source: Survey questionnaire 2011
The
above table shows that, only 40% of the respondents were not agreed with the
fact that fiscal instrument has positive impact in the economy, while the
remaining 60% responded agreed with it.
CHAPTER
FIVE
5.0 SUMMARY OF FINDING CONCLUSION AND
RECOMMENDATION
5.1 The main instrument of fiscal [policy are
taxation and government expenditure, Fiscal policy in itself is a non-monetary
policy measures used by the government to regulate economy, according to the
dictate of the economy, its objective should be attained. in an attempt to
provide more economic activities of government increase the total expenditure
on projects and services that will tend to efficient allocation of resources
and promote economic growth and development.
In chapter two, the impressions and
opinions of some reputable and reckoned Nigerians concerning the Fiscal
instrument a necessity for economic development problem as expressed in
textbooks, magazines, journals etc. were reviewed.
Chapter three and four were designed to
discuss the research measure taken, area
of study population for the study, sample and sampling techniques and
presentation of data and analysis respectively.
FINDING
This is concerned with the actual
finding of the researcher in field. The result of this research effort show how
the problem of fiscal instrument a necessity for economic development can be
curbed.
Any the major roles in which First Bank
of Nigeria PLC, Ilorin Branch is playing towards economic development of our
great country Nigeria.
It was discovered by the researcher that
problems and prospect of fiscal policy in Nigeria.
There are many
problems facing the proper implementation of fiscal policy and ultimately
hinders the efficiency of fiscal instruments in Nigeria some of those problems are:
1. Problem
of implementation: Nigeria
is characterized with good policy by the way of implementation is the problem.
Some worsen economic trends is as a result of bad implementation.
2. The
level of education: Education of our people has seriously impeded out fiscal
policy implementation of some people who could help in the implementation of
fiscal are completely unaware because of their illiteracy.
Tax collections for instance, are
difficult because those that will pay it are not co-operating.
3. Fraud
and public embezzlement: if people swallow their pride to pay the tax the money
can be diversified into personal consumption. Therefore most of the government
projects are paper implemented without an actual implementation of the policy.
4. Problem
of basic material: some infrastructure facilities that could be available for
instance, tax collection involves paying good roads to the designed collection
date area. If the area is not accessible, it will affect the tax collection and
establishment of banking industries.
All
these greatly affect fiscal policy implementation. Their pride to pay the tax,
the money can be diversified into personal consumption. Therefore, most of the
government projects are paper implemented without an actual implementation of the
policy.
5. Political
instability: another problem facing fiscal policy is the political instability
of Nigerian. government, same administration will have nearly finished the
execution of their policy when there will be a change in the seat of
government.
All these greatly,
affect fiscal policy implementation
5.2 CONCLUSION
After a comprehensive research
work on this project, from the analysis of data collected the researcher has
come to conclude that the need of economic development of fiscal instrument of
First Bank of Nigeria plc should be improved so has to enhance the spread of
development of the bank toward realizing their set of objectives.
Also the four elements which
enhance speed development of fiscal instrument which are human resources,
natural resources, capital formation and technology (use of computer etc.) add
the backdrop of effectiveness of fiscal instrument.
However to a great length the
fiscal instrument currently in use of First Bank of Nigeria plc, has created a
new lead way in the history of economic development in First Bank of Nigeria
limited (Ilorin Branch) economic growth is attainable if there is increase in
consumption level and aggregated demand
if balance of payment problem is alleviated.
5.3 RECOMMENDATION
Budget deficit should be avoided;
it is relevant in the short run at long run it will increase the level of
economic activities.
There should be proper
implementation and monitoring of project to avoid wasteful spending people
should be enlightened on the need to pay tax voluntarily smuggling is an
economic sabotage. It should be discouraged by prosecuting the smugglers.
Submission of accounts:: -
Business men should be compelled to keep proper books of accounts which should
be audited yearly or women as well. Staff welfare non-recruitment of sufficient
competent and adequately remunerated personnel is one of the factors which
contribute to low economic development. It is recommendation that competent
professionals like, accountants, auditors and lawyers, be recruited to top
point. The successful implementation of all the recommendation stated above
will depend on provision of necessary incentives and motivations for the
officials. It is therefore recommended that staff be adequately remunerated and
given immense training, other incentives and promotion opportunities etc. all
will encourage them to increase their output and collection.
Provision of working tools:
Necessary working tools like telephones and department vehicles to easy the
process of collection and enforcement supply of stationeries tax form and
receipts adequate and satisfaction office accommodation should be provided by
the government to the boards.
With all these recommendation
economic development is worthily attained.
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Element of banking olad publisher,
page 86
PAUL A. SAMSON and
WILLIAM D. NORDHHESUS (2005)
ECONOMIC eighteen edition great
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Element of banking Rock communication Nig publisher’s pg202
KA ISHOLA (2005)
macro economic, trust in God publication plc 118
Alan MMA (1772)
fundamentals of economics 2nd Edition Monica London Monica publisher ltd.
Graham DA (1991) Foundation iii
Economics 3rd Edition Ghana, Donnelly publisher ltd.
Kalu I kalu (1985) Fraud in Banking
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KA(2005) Principle of economic volume 2 olad publisher ltd.
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