This research work is defined to look into internal control system in PHCN and to evaluate the system. Whether there is any problem associated with internal control system and possible solution to be adopted to make sure that the problem is solved.The study by identifying that there is internal control system and the evaluation of the design of the samples establishment with a view to determining its adequacy. The study extended to assessing the degree of efficiency in operating the control instance in the sample establishment. In order words this research will help, use with the possible solution to be adopted to make sure that the problems solved. This work will also review work with the new one to know what is lacking in the past research work. The major objective of the study is to find out how internal control system carrying out this research, primary sources of information like interview and questionnaire and also apply secondary sources like textbooks annual report journals and periodicals. Presenting the data in a text method, semi-text method tabular form and appropriate statistical tools will be applied in analyzing the projects data..
CHAPTER ONE
INTRODUCTION
CHAPTER TWO
LITERATURE REVIEW
RESEARCH METHODOLOGY
DATA PRESENTATION AND
Summary of findings conclusion and recommendations
Bibliography
Appendixes
INTRODUCTION
Background of Study
The statement on study auditing standards defined internal control as being not only internal check and internal audit but the whole system of controls, financial or otherwise, establishment by management in order to secure, as far as possible, the accuracy and reliability of the records run the business in an orderly manner and safeguard the company’s assets its objective being the prevention or early detection of fraud and errors.
One of the major factor believed to restrict efficient performance of most Nigeria public sector enterprise is un-serious approach towards accountability. There is a great need to establish internal checks and auditing system as well as defining a control of financial and management procedure so as to carry on the operations of the enterprise in a way as to guard against the possibility of not only fraudulent practices and financial recklessness but also enhance performance and public confidence the enterprises.
National electric power Authority (PHCN) is an important public enterprise in Nigeria established by decree No.24 of 1st April 1972, with the amalgamation of Electricity corporation of Nigeria (ECN) and Nigeria dams Authority (NDA). PHCN was empowered to maintain an efficient, co-ordinates and economic system of electricity supply to all the nooks and cranny of the nation.
It’s operations especially it’s financial management and control system has been subject of intense debate. This is as a result some unsatisfactory performance as evidenced by near darkness all the time.
There is need to look at the internal control system in PHCN and it’s operational performances in the area of efficiency
1.2 Statement of problem
The national electric power, authority (PHCN) has the statutory function of catering for the electricity needs of the nation Nigeria. But the power supply has some factor contributing to power interruption. This interruption has terminology, which is termed “planned and unplanned outages”. For the planned outages, the authority takes light off to do repair and maintenance work to avoid a major breakdown.
Before this job is embarked upon, customers are normally informed through the media, both princ and electronic. Telling them about the interruption, and length of time involved.
The unplanned outages come up due to faults there are kind of “accidents” could be tripping of a protective device to save the equipment due to overloading or fault in the equipment or an “unholy” intervention in the network like canalization erosion effecting the transmission towers, bush burning or other illegal activities (tapping power illegally) thus over-loading the stem, which could trigger off the tripping of protective devices thereby causing interruption of supply. Over-loading no doubt impacts on the quality of service.
PHCN are funded with public fund example taxpayer generate money to enable it keep a float and provide for certain essential materials for effective operation.
PHCN being a public owned company which supposed to be profit-oriented, should be examined on.
Statutory allocations from the federal government to PHCN, as well as money generated by PHCN internally is properly utilized and documented or whether they were lost in the system level due to inadequate control
1.3 The purpose of the study
The objective of internal control is to achieve the completeness, accuracy and validity of recording of the transaction of the organization. To this end, the essence of proper and adequate internal accounting control in an enterprise cannot be over looked. Choosing PHCN Enugu district as the study sample, the objective of this study is to find out whether:
The significance lies in the fundamental function of the internal control system the function of establishing internal checks and auditing system aimed at safeguarding it against the possibility of fraud and financial recklessness. It is also aimed at enhancing performance and public confidence in the enterprise service, it links the workers and management through its operations and gears them to greater heights.
This study is strongly believed to be beneficial and meaningful to the management of PHCN Enugu district, as well as other profit-oriented and partly commercialized federal parastals like NITEL NIPOST and Nigerian port Authority where lock of or inadequate financial checks administrative and fiscal control has been the order of their operations.
The research is basically designed to uncover whether “internal control system in PHCN Enugu district is efficient enough to give adequate feed-lack to management for proper accountability”.
The following hypothesis will be tested in this study.
Ho: System of internal control exists but it is inadequate.
Hi: System of internal control does not exist
Ho: Feedback system exists and is functioning
Hi: No functional feedback system exists in PHCN Enugu district.
The scope of the work will be to study the extent that internal control system is being practiced by PHCN particularly. Enugu district. This research is so designed to cover some important areas in a typical federal parastals PHCN. This controls which includes independent checks management on records and assets.
Those controls which are relevant and are properly covered in this work, include the following:
Energy sales/cash collection
Petty cash
Payroll
Capital contribution/excess service charge
Bank reconciliation
Meter reading and bills distribution
LIMITATIONS
These are the constraints or problems, which I encountered in the process of collecting data for this research topic.
The limitation problems include:
Though I am happy that after all these constraint problems I was able to gather as much data as possible for my research.
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