ABSTRACT
This research was aimed at finding out the impact of public sector
accounting in Nigeria financial control system using Esan south east local
government area of Edo state as a case study. The purpose was to find out
if the control of public fund adopted by the local government is
appropriate, to determine whether the public sector accounting principle
applied by the local government is appropriate and effective and also to
investigate whether the source of revenue to the local government is
enough for them etc. The population size used was the staff and members
of Esan south east local government area of Edo state, out of which the
sample size was selected using the Taro Yamani‟s sampling techniques.
Data for this study were primarily and secondarily sourced. Chi-square was
used to analyze the responses gotten from the distributed questionnaires.
The findings made in this study are; the public accounting principles
applied by the said local government area is inappropriate and ineffective
and the control of public fund measures adopted is also inappropriate etc,
based on the findings, it was concluded that the public sector accounting
principles applied by the local government is inappropriate and also the
control of public fund measures adopted was inappropriate.
Recommendations were also made based on the findings which are, an
account committee should be set up to control the accounting system of the
said local government and monitor their day to day activities etc and when
this is met, the goal of creating the local government will be achieved.

CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Public sector is that sector of the economy established and operated by
government and its agencies distinguishable from the private sector and are
organized on behalf of the whole citizens while Public sector accounting is
the process government agencies and municipalities use to record financial
transactions.
Mathias, (2004:78). Said, similar to private sector accounting in theory, the
focus of public sector accounting is somewhat different. Most government
agencies and municipalities need to track funds generated from tax
revenues and expenditures related to projects or appropriations. In addition,
nations may need to follow a set of standard of accounting principles
different from private sector accounting rules. The creation of an
international accounting standard helps nations to follow similar rules in
other to present information in a similar manner.
Government accounting typically uses a set of rules that tracks financial
information. Rather than attempting to determine how much money a
public sector entity has made, the entity must report financial information
to interested parties, primarily constituents. The separation of money into
these funds makes it difficult for government agency or municipality to
spend money on unauthorized purposes. Elected officials or legislatures
11
must create appropriations or spending authorizations to transfer funds
amongst government fund accounts. This process attempts to restrict the
spending of money on a free-will basis that will quickly deplete an
agency‟s resources
Similar to private sector accounting, public sector accounting principles
often seek to lay a framework for accounting practices.
Afolabi,( 2004:320). Said rather than creating a hard set of rules to follow,
the principles allow for an application of basic principles to either large and
small entities or municipalities. An international set of accounting
principles is also necessary for smaller nations to learn and adopt rules that
will enhance their internal national accounting process. Most times,
developing nations cannot or do not have the resources capable to create
and instil a framework for their public sector accounting practices.
Adopting an international set of accounting rules will help them overcome
this problem and typically helps them start on the path better infrastructure
development.
Another purpose of public sector accounting is to create a standard
expectation of ethics and accountability for a nation‟s financial
information. Standard public accounting principles will also make it easier
for a nation to undergo an audit. it is also harder for countries to hide
inappropriate financial transactions when using public sector accounting
principles. This research study will therefore appraise the impact of public
12
sector accounting in Nigerian financial control system focusing on Esan
South East local government.
1.2 STATEMENT OF THE PROBLEM
The problems inherent in this research study as investigated by the
researcher are;
1. INADEQUATE REVENUE: that is, the source of revenue available to
Esan South East Local Government authority most often is not enough
for them, as this invariably affects diverse activities that are carried out
in the local government area.
2. Poor administration of local government funds.
3. Another problem is the fact that the control of public fund adopted by the
local government is inappropriate. It is as a result of this that there are
still setbacks in the local government as regards to infrastructural
development.
4. The adoption of inappropriate and ineffective public sector accounting
principles and guidelines.
5. Another problem is that the accounts of the local government are
characterized by inadequacies such as, improper maintenance and book
keeping of accounts and other necessary records, embezzlement of
public funds especially by the top officials.