OGUORA, EUCHARIA UKAMAKA€¦ · Education with Registration No PG/M.Ed/13/65251 has satisfactorily...

BASIC FIENTREPRENEURSHISECONDARY SCHOOL STUDENTS

FACULTY OF VOC

DEPARTMENT OF

Ebere Omeje

OGUORA, EUCHARIA UKAMAKAPG/M.Ed/13/65251

BASIC FINANCIAL ACCOUNTING SKILS REQUIRED FOR ENTREPRENEURSHIP DEVELOPMENT BY SENIOR SECONDARY SCHOOL STUDENTS IN ANAMBRA STATE

FACULTY OF VOCATIONAL TECHNICAL EDUCATION

DEPARTMENT OF BUSINESS EDUCATION

Ebere Omeje Digitally Signed by: Content manager’s Name

DN : CN = Webmaster’s name

O= University of Nigeria, Nsukka

OU = Innovation Centre

OGUORA, EUCHARIA UKAMAKA

REQUIRED FOR DEVELOPMENT BY SENIOR

IN ANAMBRA STATE

ATIONAL TECHNICAL EDUCATION

Digitally Signed by: Content manager’s Name

DN : CN = Webmaster’s name

O= University of Nigeria, Nsukka

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BASIC FINANCIAL ACCOUNTING SKILLS REQUIRED FOR ENTREPRENEURSHIPDEVELOPMENT

BY SENIOR SECONDARY SCHOOL STUDENTS IN ANAMBRA STATE

BY

OGUORA, EUCHARIA UKAMAKA PG/M.Ed/13/65251

DEPARTMENT OF BUSINESS EDUCATION FACULTY OF VOCATIONAL TECHNICAL EDUCATION

UNIVERSITY OF NIGERIA, NSUKKA

JANUARY, 2016

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TITLE PAGE

BASIC FINANCIAL ACCOUNTING SKILLS REQUIRED FOR ENTREPRENEURSHIP DEVELOPMENT BY SENIOR SECONDARY SCHOOL

STUDENTS IN ANAMBRA STATE

By

OGUORA EUCHARIA UKAMAKA PG/M.Ed/13/65251

A RESEARCH PROJECT PRESENTED TO THE DEPARTMENT OF BUSINESS EDUCATION, FACULTY OF VOCATIONAL TEACHER EDUCATION, UNIVERSITY

OF NIGERIA NSUKKA, IN PARTIAL FULFILMENT FOR THE AWARD OF MASTERS DEGREE IM BUSINESS EDUCATION

SUPERVISOR: PROF. E. E. AGOMUO

JANUARY, 2016.

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APPROVAL PAGE

This project has been approved for the Department of Business Education, University of

Nigeria Nsukka.

BY

------------------------ ------------------------ Prof. E. E. Agomuo Internal Examiner Supervisor ------------------------ ------------------------ External Examiner Prof. C. A. Obi Head of Department

------------------------ Prof. C. A. Igbo Dean of Faculty

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CERTIFICATION

I,OguoraEuchariaUkamaka a postgraduate student in the Department of Business

Education with Registration No PG/M.Ed/13/65251 has satisfactorily completed the requirement

for research work for Master’s Degree in Business Education. This work embodied in this

project is original and has not been submitted in part or full for any other Diploma or degree of

this or any other university.

---------------------- ----------------------- Oguora, E. U. Prof. E. E. Agomuo Student Supervisor

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DEDICATION

This work is dedicated to Almighty God, the giver of life, knowledge and wisdom.

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ACKNOWLEDGEMENTS

May all praises and adorations be unto the Almighty God, the giver of life, knowledge

and wisdom for his mercies and grace upon my life and the ability to complete this programme. I

am most grateful to my supervisor Prof. E. E. Agomuo for his tolerance, directions, guidance,

suggestions and constructive criticisms in going through every stage of this study.

Great thanks are due to all the lecturers in Business Education department in particular and

in Vocational Teacher Education in general for their supports. Encouragements, valuable

suggestions, corrections, and advice in the making of this project work. I gratefully acknowledge

the special contributions of Dr E. C. Ugwuoke, Dr J. k. Edeh (ACA) and MrsUjufor their

contributions as validators of the instrument used for collecting data in this work. I am also

indebted to DrTochukwuEjiofor and Dr E. A. Etonyeaku for their contributions as design and

content readers respectively and Prof. C. A. Igbo for their constructive criticisms and

suggestions. I am also grateful to Dr. C.J. Olelewe for his time, corrections and constructive

criticism.

I am most grateful to my husband Mr Daniel Ikeh, my children, Chidera, Chinonso,

Kosisochukwu and Amarachukwu for their endurance and tolerance during this programme. I am

also grateful to my mother Veronica Oguora, BrotherMrUcheOkafor, SistersDrNkechi, Joy,

Oluchi,Anthonia, Chika, Chinenye and Obiageli for their encouragements.

I also extend my sincere gratitude to my mentors Bro. Monday Anyaora and Rev. Emma

Anyaogu for their prayers and encouragements during this programme and my friends and

colleagues IkechukwuOdogwu,Ogwuma Dike,Mr Luke, Mr Samuel, EbukaNwammadu for their

assistance to see this project work through.

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Finally, I alsoappreciate the Statistic Department of AnambraMinistry of Education,

accounting lecturers and teachers in public higher institutions and public secondary schools in

Anambra state for their cooperation in responding to the questionnaire and for providing the

population data used for this work, may Almighty God bless you all in Jesus Name Amen.

.

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TABLE OF CONTENTS

Title Page i Approval Page ii Certification iii Dedication iv Acknowledgement v Table of Contents vi List of Tables ix List of Figures xi Abstract xii CHAPTER ONE: INTRODUCTION

Background of the Study 1 Statement of the Problem 7 Purpose of the Study 8 Significance of the Study 9 Research Questions 11 Hypotheses 12 Delimitation of the Study 13

CHAPTER TWO: LITERATURE REVIEW Conceptual framework 14 Over view of Entrepreneurship Development 15 Skill 19 Financial Accounting 20 Financial Accounting Skills 23 Prime BookSkills 23 Cash BookSkills 29 Bank Reconciliation Skills 35 Ledger Classification 38 Trading, Profit and Loss Account Skills 42 The Balance Sheet Skills 45 Senior Secondary Schools/Accounting Teachers 48 Theoretical Frame Work 52 Need Achievement Theory 52 Risk Taking Theory 53 Related Empirical Studies 53 Summary of Literature Reviewed 56

CHAPTER THREE: METHODOLOGY

Design of the Study 57 Area of theStudy 57 Population for the Study 57 Sample and Sampling Techniques 58 Instrument for Data Collection 58 Validation of the Instrument 59 Reliability of the Instrument 59

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Method of Data Collection 60 Method of Data Analysis 60 CHAPTER FOUR: PRESENTATION AND ANALYSIS OF DATA 61 Findings of the Study 76 Discussion of the Findings 78 CHAPTER FIVE: SUMMARY CONCLUSION AND RECOMMENDATION Re-Statement of the Problem 85 Summary of Procedure Used 86 Summary of Findings 87 Conclusion 88 Implications of the Study 89 Recommendations 90 Limitation of the Study 90 Suggestions for Further Studies 91 References 92 Appendices Appendix A: Population Distribution for the Study Appendix B: Final Draft of the Questionnaire Appendix C: Senior Secondary Education Curriculum Appendix D: The Reliability Test Analysis

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LIST OF TABLES

Table 1: Mean and standard deviation of responses of accounting teachers and lecturers perception of the prime book entry skills required for entrepreneurship development by senior secondary school students of Anambra State.61

Table 2: Mean and standard deviation of responses of accounting teachers and lecturers perception on the cash book entry skills required for entrepreneurship development by senior secondary school students ofAnambra State. 63 Table 3: Mean and standard deviation of responses of accounting teachers and lecturers perception on the bank reconciliation statement skills required for entrepreneurship development by senior secondary school students of Anambra State. 64 Table 4: Mean and standard deviation of responses of accounting teachers and lecturers perception of the ledger skills required for entrepreneurship development by senior secondary school students of Anambra State. 65 Table 5: Mean and standard deviation of responses of accounting teachers and lecturers perception on the trading, profit and loss account skills required for entrepreneurship development by senior secondary school students of Anambra State. 66

Table 6: Mean and standard deviation of responses of accounting teachers and lecturers perception on the balance sheet skills required for entrepreneurship development by senior secondary school students ofAnambra State. 67

Table 7: t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the prime book entry skills required for entrepreneurship development by senior secondary school (111) students in Anambra State. 69 Table 8: t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the cash book entry skills required for entrepreneurship development by senior secondary school (111) students in Anambra State. 70 Table 9: t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the bank reconciliation skills required for entrepreneurship development by senior secondaryschool 3 students in Anambra State. 71

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Table 10: t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the ledger skills required for entrepreneurship development by senior secondary school(111) students in Anambra State. 73 Table 11: t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the trading, profit and loss account skills required for entrepreneurship development by senior secondary school (111) studentsin Anambra State. 74 Table 12: t-test analysis of the responses of the accounting lecturers and accounting teachers on their perception on the balance sheet skills required for entrepreneurship development by senior secondary school (111) students in Anambra State. 75

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LIST OF FIGURES

Figure 1: Format of Sales Day Book 25

Figure 2: Format of Purchases Day Book 26

Figure 3: Format of Return Inward Day Book 27

Figure 4: Format of Return Outward Day Book 28

Figure 5: Format of Journal Proper 29

Figure 6: Format of a Ledger 30

Figure 7: Format of a Single Column Cash Book 31

Figure 8: Format of Two Column Cash Book 32

Figure 9: Format of Three Column Cash Book 33

Figure 10: Format of a Petty Cash Book 34

Figure 11: Adjusted Cash Book Items 36

Figure 12: Format of Bank Reconciliation Statement 37

Figure 13: Format of Account Classification 39

Figure 14: Format of a Trial Balance 41

Figure 15: Schematic Diagram of Basic Financial Accounting Skills Required for Entrepreneurship Development by Senior Secondary Students 51

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ABSTRACT

The title of this study was designed to determine the basic financial accounting skills required for entrepreneurship development by senior secondary school students in Anambra state. The study adopted descriptive research design which involved financial accounting lecturers in public higher institutions and accounting teachers in government owned secondary schools in Anambra state. The population of the study was 207 financial accounting lecturers and teachers in Anambra state. Six research questions and six null hypotheses were formulated and tested at 0.05 level of significance to guide the study and at 194 degree of freedom. The instrument used for data collection was structured questionnaire item statement. To ensure that the instrument measures what it suppose intended to measure, the questionnaire item statement were subjected to face validation by three experts. Cronbach Alpha was used to determine the internal consistence of the instrument items. The average reliability co-efficient computed for the instrument was found to be 0.880. Mean was used to answer the research questions while t- test was used to test the hypothesis. The study found out that prime books entry skills were very much required for entrepreneurship development by senior secondary school leavers in Anambra state. The study also found that cash book entry skills were also very much required for entrepreneurship development by senior secondary school leavers in the state of study. The study also discovered that bank reconciliation skills were very much required for entrepreneurship development by senior secondary leavers in Anambra state. Ledger accounting skills were also found to be very much required for entrepreneurship development by senior secondary school leavers in the state of study. The study also found that trading, profit and loss account and balance sheet skills were very much required for entrepreneurship development by senior secondary school 3 students in Anambra state. The result of the study also showed that there was no significance difference in the mean ratings of financial accounting lecturers and teachers on the prime book entry skills required for entrepreneurship development. The result of the study also showed that there was no significant difference in the mean ratings of accounting lecturers and teachers on the cash book entry skills, bank reconciliation skills, ledger skills, trading, profit and loss and balance sheet skill required for entrepreneurship development by senior secondary school 3 students in Anambra State. As a result of these, it was recommended that financial accounting be made a compulsory subject in Senior Secondary Schools in Nigeria considering the need to reduce unemployment and poverty level among the Nigerian Youths.

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INTRODUCTION

CHAPTER ONE

Background of the Study

Entrepreneurship has been observed to be featuring and will continue to feature as a

major theme in both national and international conferences. This is because of its immense

contributions in the economic development of both developing and developed nations. It is an

ability of an individual to identify and extract economic activities within his environment which

others are unable to identify. It deals with the identification and extraction of new economic

ideas and strategies which are not yet been tapped by any one.Akanbi (2010) defined

entrepreneurship as the process of creating something different in valueby devoting the necessary

time and effort, assuming the accompanying financial, psychological and social risks and

receiving the resulting rewards of monetary and personal satisfaction. Entrepreneurship is the

ability to turn ideas into action by an individual. Agomuo (2002) viewed entrepreneurship as a

process of bringing together creative and innovative ideas, combining them with management

and organization skills in order to combine people, money and resources to meet an identified

need and thereby create wealth.A person who engages in an entrepreneurship process is an

entrepreneur.

An entrepreneur is therefore an individual who combines both natural and human

resources in order to create wealth.Delbridge in Muhammed, Malik, Arslam, Salman and Abid

(2013) identified an entrepreneur as a person who runs the business and bears the risk for profit

and loss. Entrepreneurs are generally classified according to types of business, technology use,

motivation, growth and entrepreneurial stages of development. For the purpose of this study,

business entrepreneurs will be considered. Entrepreneurs according to types of business can

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bebusiness entrepreneurs who conceive an idea for a new product or services and then create a

business to materialize their idea into reality, or trading entrepreneur who tries to identify

potential marketers, stimulates demand for his product line and creates desire and interest among

buyers to go for his products. It can also be industrial entrepreneur who identifies the potential

needs of customers and tailors a product or services to meet the marketing needs. Whichever

type of entrepreneurship that exists, it can be learnt and developed.Williams in Onu (2013)

asserted that entrepreneurship is a learnable process that can be taught, nurtured, supported and

enhanced through various types of education and training.

Entrepreneurial development may be conceived as a programme of activities to enhance

the knowledge, skills and abilities of individuals and groups to assume the role of entrepreneur as

well as efforts to remove all forms of barriers in the path of entrepreneur (Okiti- Okagbare,

2008). In the words of Shane and Venkataraman in Akhnokalome (2013), the thrust of

entrepreneurship development entails identifying the sources of opportunities, the process of

discovery, evaluation, and exploitation of opportunities; and the set of individuals who discover,

evaluate and exploit them. Most entrepreneurship businesses in Nigeria operate on the level of

small and medium scale basis due to the amount of capital involved in the business and the

number of personnel that can be accommodated (Aruwa, in Ezeani, Ifeonyemetalu and

Ezemoyihe,2012). Akpotowoh(2005) stated that most people currently engage into

entrepreneurship without acquiring much skills and competencies that will enable them to

effectively operate the business. As a result of this attitude, high rate of failure is experienced

instead of success.Ezeani, etal (2012) noted that the failure is not always because entrepreneurs

do not have the necessary capital to stay afloat, but because they some timeslack the pre-requisite

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skills required to grow from small position to bigger one and also remain in the business. One of

the major skills required for growth of entrepreneurial businessesis financial accounting skill.

Financial accounting is a branch of accounting that gathers and summarizes financial data

for the organizational management decisions and for the outsiders who are interested in the

affairs of the organization. Financial accounting is a concept and technique by which financial

data are processed into meaningful information for reporting, planning, controlling and decision-

making purposes. Ezeani (2008) defined financial accounting as the process of expressing the

economic activities of everyday life in money terms.The process of recording, classifying,

selecting, measuring, interpreting and communicating financial data of any business to enable

users make decision in called accounting (Longe and Kazeem, 2012). Accounting is one of the

most effective decision making tools of the management. Obi (2011) asserted that managers of

businesses should possess skills in accounting for marketing and personnel management. Small

business operators (entrepreneurs) should be particularly versed in accounting skills especially

financial accounting skills.

Financial accounting is a branch of accounting that gathers and summarizes financial data

for the preparation of financial reports for the organizational management and outsiders who are

interested in the affairs of the organization. Financial accounting skills therefore can be said to be

those skills that enables an individual to effectively and efficiently enter, retrieve and analyze

financial data of a business concern. The basic financial accounting skills required by business

operators (entrepreneurs) are prime book entry skills, cash book entry skills, bank reconciliation

skills, ledger skills, trading, profit and loss account skills and the balance sheet skills (FRN,

2011).

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The prime books of accounts are also known as subsidiary books or books of original

entry. According to Igben (2009), the subsidiary books are books into which transactions are

recorded on a daily basis from the source documents and from which transfers are made at

suitable periodic intervals to the relevant accounts in the ledger. The prime books help to reduce

clustering of too much items in the ledger. These books includes: sales day books, used in

recording credits sales, purchases daybook used in recording credit purchases, returns inward

daybook, returns outward daybook and cashbook used in recording receipt and payment of

money.

The cash book is a financial book used in recording all cash transactions. These include

both cash and bank transactions. The cash book helps to monitor cash inflow and outflow in a

business. Cash is the basic unit needed to keep businesses running on a continuous basis; it is

also the ultimate output expected to be realized by selling the products of a firm. Moreover, by

introducing a fair system for recording business cash transactions, the owner is able to exercise

control on him regarding withdrawals of funds for his personal use which would otherwise have

been available for business expansion (Moorthi, 2001).Most cash received are paid into the bank

and some cash payments made through the bank also.

The cash book has both the cash and bank columns. Discrepancies often arise between

the cash book balance and the balance shown in the bank statement. These discrepancies are

often caused by timing of transactions and lack of communication of some transactions

performed by the bank on behalf of its customers,hence the need to reconcile the both books.

Bank reconciliation statement is therefore is prepared to bring to agreement the customers cash

book and the statement issued by the bank. Longe and Kazeem (2012) defined bank

reconciliation statement as a statement that is prepared to reconcile the disagreement between the

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cash book balance and the balance in the bank statement. According to the authors,reconciliation

is necessary in order for the cash book and the bank balance to be the same.

Furthermore, owners of business organizations, small or large should be able to record its

transaction in the ledger. There are many kinds of ledger accounts. An account is a page in the

ledger divided into two halves with vertical and horizontal line(Igben, 2009). Accounts are

classified into two major groups namely: personal account and impersonal account. Personal

accounts are account for the names of individuals, firms and business enterprises who are either

creditors or debtors to a business organizationwhile impersonal accounts are accounts for

properties, items of expenditure and income (Longe and Kazeem, 2012). Personal accountcovers

the receivables and payables from debtors and creditors respectively, (Igben, 2009). The postings

in the ledger accounts can be tested for arithmetical accuracy and conforming to the principle of

double entry. The schedule or list that shows the debit and credit balance extracted from the

ledger to show the arithmetical accuracy of the ledger is the trial balance (Longe&Kazeen,

2012). It is a technique that ensures that debit and credit balances as displayed in the ledger

account are correct. The trial balance helps to test the accuracy of the double entry system used

in entry the ledger accounts.

Similarly, trading profit and loss account skills are important skills required for

entrepreneurship development. The trading account is a revenue account prepared to show the

gross profit or gross loss while the profit and loss account it is prepared to show net profit or net

loss at a particular period of time (Igben, 2009). The profit obtained in profit and loss account

is usually transferred to the balance sheet to increase the capital. The balance sheet is a statement

that shows the summary of assets and liabilities in well-arranged form (Longe and Kazzeem,

2012). According to the authors, the balance sheet isnot an account but a statement

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InAnambra state, majority of the citizens engages in one form of entrepreneurship

business or the other, while some of the entrepreneurs are not educated those that have some

education may not have the necessary skills especially financial accounting skills required for

successful entrepreneurship. They often invest on goods that are not fast moving in the market,

dip hands into the business capital anyhow to solve some personal problems and cannot

determine whether the business is making profit or loss. Some of them also forgot who owes

them, the amount being owed and even what was sold due to lack of pre-requisite accounting

skills which often leads to early collapse of their businesses.

Since some of the small scale business men in Anambra state do not further their

education beyond senior secondary school level, those school leavers who often attempt to

establish their own businesses most often get into quick liquidation and bankruptcy because they

lack basic financial accounting skills and so the need to teach them the pre-requisite financial

accounting skills for future career when they still in school.

The importance of financial accounting in the growth of any business cannot be over

emphasized for it helps to foster growth in businesses by providing financial information needed

for easy accessibility to bank loans and overdraft. It also helps in decision making. Ofonagoro

(1993) while commenting on the importance of financial accounting skills in the life of any

business asserted that the high incidence of failure among small scale enterprises in Nigeria may

be attributed to the poor accounting system used by these enterprises. Since the main aim of

every business is to make profit, and to be able to determine the amount of profit made at a

particular period, financial records has to be kept using financial accounting skills.

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Statement of the Problems

Nigerian government (both past and present) had made several efforts to support

entrepreneurship development and to reduce the level of poverty and unemployment among

Nigerian youth. These effortsincludes: National Poverty Eradication Programme (NAPEP), small

and medium enterprises development agency of Nigerian (SMEDAN) among others. Despite

these efforts, most of the youth especially secondary school leavers in Anambra state who could

not further their education still roam the streets without jobs. They continue to besiege ministries

and government offices in search of jobs that are either veryfew in supplies or even none existing

and even engage in social crimes and political violence.

Similarly, the objective of book-keeping and accounting as stated in 2007 senior

secondary education curriculum in business studies vol.4 stressed among other objectives that

financial accounting is to provide fundamental instruction to help students assume their

economic role as consumers, workers and citizens and also provide skills for personal use in the

future. These objectives as stated have not been met yet. This is evidenced in the inability of

senior secondary school graduates in Anambra state who are hired to work as either sales boys /

girls or account clerks to remain in jobs and retarded growths and liquidation experienced by

most small and medium scale businesses in the state. The graduates are either fired so soon by

their employers or self-frustrated out of the job due to lack of basic financial accounting skills.

Secondly, the National policy on education stated that one of the objectives of senior secondary

education is to provide entrepreneurs with technical and vocational job specific skills for self-

reliance (FRN, 2013). Similarly, the senior secondary school curriculum in business studies

stated that one of the objectives of book-keeping and accounting is to provide fundamental

instructions to help students assume their economic roles as consumers, workers and citizens and

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to provide skills for future use (FRN, 2007). All these objectives have not been realized

evidenced in the increasing number of unemployed secondary school leavers in Anambra state.

Anambra state is one of the major commercial cities in Nigeria inhabiting the largest

market in West Africa. A focus group discussion had with some small scale business owners

(entrepreneurs) in Anambra state by the researcher revealed that most of the senior secondary

school students in Anambra state do not offer financial accounting as their subject choice and

some that do, does not acquire the financial skills and when the students leaves school and

establishes any business, the business either liquidates soon after establishment or remains

retarded in growth due to lack of financial accounting skills. Some of these secondary school

leavers who engage themselves with the job of account clerk are either fired soon by their

employers or self-frustrated out due to their inability to apply financial accounting skills to their

job.

It is on this basis that this study tends to determine the basic financial skills that are

required for entrepreneurship development by senior secondary school students in Anambra

state. Therefore, the problem of this study is the none acquisition of basic financial accounting

skills by senior secondary school leavers in Anambra state.

Purpose of the Study

The major purpose of the study is to determine the basic financial accounting skills

required for entrepreneurship development by senior secondary school 3students inAnambra

state. Specifically, the study seeks to determine the:

1. prime book entry skills required for entrepreneurship development by senior secondary

school 3 students inAnambra state.

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2. cash book entry skills required for entrepreneurshipdevelopment by senior secondary


3. bank reconciliation skills required for entrepreneurshipdevelopment by senior secondary


4. ledger skills required for entrepreneurshipdevelopment by senior secondary school

3students inAnambra state.

5. trading, profit and loss account skills required for entrepreneurship development by

senior secondary school 3 students inAnambra state.

6. balance sheet skills required for entrepreneurship development by senior secondary


Significance of the Study

The result of this study will be beneficial to senior secondary school 3 students, financial

accounting teachers, curriculum planners, education authorities, existing and potential

entrepreneurs, parents, researchers and Nigerian government in general.

The findings of this study when included in the curriculum and taught will expose the

students to the basic financial accounting skills that will enable them to establish, manage and

grow their own businesses. It will also encourage them to search for business opportunities

around them and exploit them. It will also expose them to possible causes of business failure and

enable them to make adjustments on their own businesses.

Financial accounting teachers will also benefit from the findings of the study in the sense

that it will expose the teachers to the basic financial skills that are most profitable to thestudents.

The teachers will therefore concentrate on those skills while teaching to make sure that those

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skills are properly inculcated into the students for better entrepreneurship development when

made public through seminars and conferences.

Curriculum planners and education authorities will also benefit from the findings of this

study when made known to the public throughseminars. To the curriculum planners, the study

will enable themrealize the basic financial accounting skills that are most necessarily required by

senior secondary school students for the planner to make sure they are included in the curriculum

during planning and to bring the skills out in the performance objective and content columns of

the curriculum while planning.

To the education authorities, the findingsof this study when made available through

seminars and conferences will assist them to ensure quality control on the determined skills, and

to lay emphasis on them during inspection and supervision to make sure that the teachers of

financial accounting pay more attention to these skilled areas during teaching and in so doing,

the stated objective of financial accounting which includes among other things to provide book-

keeping and accounting skills for personal use in the future will be realized.

The findings on the prime book skills, cash book skills, bank reconciliation skill, ledger

skills, trading, profit and loss account skills and the balance sheet skills when made public during

seminars will enable existing entrepreneurs to understand the reasons behind their businesses

retarded growths and development and enable the entrepreneurs device means of reviving their

businesses. These acquired financial accounting skills will also enable the potential entrepreneurs

to establish, manage, grow and maintain small business of their own. It will also make them to be

aware of the causes of business failure and help them to guard against them before establishing

their own businesses.

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Parents who retire from their jobs and have in mind to startup businesses of their own

will also benefit from the findings of this study when published. It will also equip the parents

with the basic financial record keeping and skills that will assist their businesses grow faster.

And to the researchers, the finding of this study will expose to them the problem areas that need

to be worked on and also serve as reference material to them.

Finally, the findings on prime books, cash book, ability to bank reconciliation statement,

trading, profit and or loss account and balance sheet will be beneficial to the government in

general by the time entrepreneurs gets the outcome of this study through seminars and the

resultant effect of its application to their businesses. This is because, the government will be

encouraged to allocate more fund toward entrepreneurship development in the country seeing

that the sponsored entrepreneurs are able to grow and manage their businesses well. The

government will also benefit from the findings of this study because as entrepreneurship

develops, the production level will increase which will increase the Gross Domestic Product

(GDP) which will inturn increase the economic growth and development of the country and

reduce unemployment rate and poverty level among the citizens.

Research Questions

The following research questions will guide the study;

1. What are the prime book entry skills required for entrepreneurship development by senior

secondary school leavers inAnambra state?

2. What are the cash book entry skills required for entrepreneurship development by senior


3. What are the bank reconciliation skills required for entrepreneurship development by

senior secondary school leavers inAnambra state?

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4. What are the ledger skills required for entrepreneurship development by senior secondary

school leavers inAnambra state?

5. What are the trading, profit and loss account skills required for

entrepreneurshipdevelopment by senior secondary school leavers in Anambra state?

6. What are the balance sheet skills required for entrepreneurshipdevelopment by senior


Hypothesis

Ho1: There is no significant difference in the mean ratings of accounting lecturers and

accounting teachers on the prime book entry skills required for entrepreneurship

development by senior secondary school 3 students inAnambra state.


accounting teachers on the cash book entry skills required for entrepreneurship

development by senior secondary school 3 students inAnambra state.


accounting teachers on the bank reconciliation skills required for entrepreneurship

development by senior secondary school 3 students in Anambra state.


accounting teachers on the ledger skills required for entrepreneurship development by

senior secondary school 3 students inAnambra state.


accounting teachers on the trading, profit and loss account skills required for

entrepreneurship development by senior secondary school 3 students inAnambra state.

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accounting teachers on the balance sheet skills required for entrepreneurshipdevelopment

by senior secondary school 3 students inAnambra state.

Delimitation of the Study

This study is delimited to financial accounting skills required for entrepreneurship

development by senior secondary school III (SSS3) students inAnambra state. Specifically, the

study will cover the prime book, cash book, bank reconciliation, ledger, trading, profit and loss

account and balance sheet skills required for basic entrepreneurship development by senior

secondary school III students inAnambra state.The opinions ofaccounting lecturers in higher

institutions and accounting teachers in senior secondary schools in Anambra state will be sought

to determine the objective of this study.

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CHAPTER TWO

LITERATURE REVIEW

This chapter presents the review of related literature to this study

Conceptual Framework

• Overview of Entrepreneurship Development

• Skills

• Financial Accounting

• Financial Accounting skills

• Prime/Subsidiary Book

• Cash Book

• Bank Reconciliation Statements

• Ledger Account

• Trading,Profit and Loss Account

• Balance Sheet

Senior Secondary School Students/Teachers

Theoretical Frame Work

• Need Achievement Theory

• Risk Taking Theory

Related Empirical Studies

Summary of Literature Reviewed

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Over view of Entrepreneurship Development

Socio-economic development has become the major issue in the developing countries

like Nigeria. These countries are endowed with so many natural resources but lack the skills and

abilities to exploit them. Entrepreneurship has been globally accepted to be critical to economic

growth and development in an emerging economy such as ours. The word “entrepreneurship” is

derived from the French verb “entrepredre”, which means “to undertake” (Jannings in Onu, some

new business ideas which others were not able to identify. Supporting this view Hisrich, Peter

and Shephard in Idogho and Aniabor(2011) defined entrepreneurship as a process of creating

something new with value by devoting the necessary time and efforts assuming the

accompanying financial psychic and social risks, and receiving the resulting rewards of monetary

and personal satisfaction and independence.

Entrepreneurship is not just acquiring the abilities for innovative businesses and

opportunities; it also involves the nature of those abilities acquired. Azubike (2006) noted that

entrepreneurship means having the abilities to find andevaluate business opportunities, gather the

necessary resources, initiate appropriate action to ensure success, and implement actions to take

advantage of the opportunities rewarding outcome. Entrepreneurship refers to the willingness

and ability of an individual to seek investment opportunities in an environment, and be able to

establish and run such investment successfully based on the identified opportunities (Gana,

2001). Supporting this view Osuala (2004) and Duru (2006) see entrepreneurship as a specialized

training given to students to acquire skills, ideas and management abilities necessary for self-

reliance. The art of concentrating, controlling, planning and directing the other factors of

production is entrepreneurship (Onu, 2013). Meredith in Onyekonwe and Peter (2008) also

asserted that entrepreneurship has to do with a combination of personal characteristics, financial

14

16

means and resources within your environment and taking advantage of them for rewarding

outcome. Entrepreneurship can be taught, learnt, developed and nurtured for growth in the life of

an individual.

Entrepreneurship development is a process of human resource development aimed at

providing appropriate skills to a pool of entrepreneurs and using the resources of the economy to

ensure continuous availability of this for wealth creation and enterprise building (Iromaka and

Uche, 2008). According to the authors, developing entrepreneurial skills involves a process of

human capacity building through formal and /or informal training, inculcating in the

entrepreneurs basic skills such as financial management skills among others. Okiti-Okagbara in

Iromaka et.al (2008) described entrepreneurial development as a programme of activities to

enhance the knowledge, skills and abilities of individuals and groups to assume the role of

entrepreneur as well as efforts to remove all forms of barriers in the path of entrepreneur.

Rebecca and Benjamin (2009) supported this view by stating that entrepreneurship development

is all about learning the skills required to assume the risk of establishing a business and

developing the winning strategies and executing them with vigour, persistence and passion

needed to win any game. The authors stressed the need for entrepreneurs to learn new skills if

they are to achieve a significant firm performances.

Commentingon the need for the entrepreneur to learn new skill for the growth of their

businesses, Osuala in Obi (2013) advised that prospective entrepreneurs should have adequate

technical ability, sufficient conceptual ability to visualize, co-ordinate and integrate the various

operations of the business into a synergistic whole. Entrepreneurs are made through experiences

and training. Entrepreneurship is the act of being an entrepreneur which means one who

17

undertakes innovations, finance and business acumen in an effort to transform innovations into

economic goals (Onu, 2013).

An entrepreneur is a risk taker who has consistency with his goals and objectives in

different situation. Nwaokolo and Osuala in Olayinka, Olufemi, Adenuga, Adeyemi and Yusuf

(2010) viewed an entrepreneur as a person who makes profit out of self-established trade or

business, who coordinates factors of production and bears the risk of uncertainty by investing

scarce resources on trade and business ventures. An innovator or developer who recognizes and

seizes opportunities; converts those opportunities into workable or marketable ideas; add value

through time, efforts, money or skills; assumes the risk of the competitive market place to

implement these ideas; and realizes the rewards from these efforts is an entrepreneur (Kuratko

and Hodgetts, 1992). According to Meredith, Nelson and Neekin Afolabi et.al (2011),

entrepreneurs are action-oriented and highly motivated individuals who take risks to achieve

goals. An entrepreneur is a businessman who makes decision that have significant impact on his

organization; he is always dominant, sociable, adventurous, intelligent and highly perceptive

(Afolabi et.al, 2011). Onu(2013) asserted that entrepreneurs operate in a dynamic environment

and must adapt to changing needs and wants of consumers. This implies that entrepreneurs

innovate ideas and businesses according to the needs of their environment. Entrepreneurs

combine the factors of production land, labour and capital in such a way as to effectively

produce tangible products of value (Onu, 2013).

Entrepreneurs aregenerallyclassified according to type of business, technology use, and

entrepreneurial development among others. Chima (2013) stated that entrepreneur is a French

word literally translated to mean“between-takers” or “go between”. According to the author, it

can further mean the development of small and medium businesses based on creativity and

18

innovation. Iromaka (2008) also classified entrepreneurs into innovators, calculating inventor,

over-optimistic promoter and organization builder. According to the author, innovators and

inventor do not care about what happens to their idea after bringing it to the notice of the public,

while optimistic promoters see to the continuation of the existence of ideas brought by

innovators, and organization builder continue to manage and enjoy the profit of the ideas. Also

on the classification of entrepreneurs, Alben in Igeraharha (2008) classified entrepreneur into

entrepreneur (good at influencing decision) entrepreneur (creativitye.g song and film writers)

Intropreneur (organize and simplifying information, e.g software creator) and autopreneur

(enjoys seeing money grow e.g saving account owner). Entrepreneur can be classified into

innovative, initiative, Fabians and Drone entrepreneurs. (Barika in Thom-Otuya, (2008)

according to the author innovative entrepreneur introduces new ideas and technology, new goods

and new method and are interested in reorganizing the enterprise for good. Imitative

entrepreneurs adapt successfully to innovations, Fabians entrepreneurs are cautious and doubtful

to changes while drone entrepreneur refuses to adopt opportunities to make change. Most

entrepreneurs in Nigeria are imitative and adopt already existed business.

The importance of entrepreneurship in the development of the nation’s economy cannot

be over emphasized. Osuala (2004) asserted that among other things, thebenefits of

entrepreneurship at the individual level is that one becomes his own boss, financial security and

joy of achievement. This implies that entrepreneurship promotes self-reliance. Entrepreneurs

have been recognized as veritable engines of growth and development (Onu, 2013). Global

Entrepreneurship Monitor in Barringer and Ireland (2006) reported that “the national level of

entrepreneurial activity has a satisfactory significant association with the national level of

economic growth”. Idomeh, Ainabor and Okorie (2008) also stated that, the growing importance

19

of the role of entrepreneurs in a country’s economic growth and development has stirred up both

developed and developing countries to formulate policies that would promote entrepreneurship

development in their economies. Entrepreneurship is also a learnable skill which can be

developed in an individual.

Skills

Skill is an ability to perform a particular activity effectively. It is the ability displayed in

the performance of a task (Osinem and Nworji, 2005). Ezeagu (2005) also viewed skills as the

ability to use one’s knowledge effectively and readily in execution of a performance; technical

expertness; a power or habit of doing anything competently. It is a well-established habit of

doing things by people (Uga, 2006). According to Okorie (2000), to possess a skill is to

demonstrate active thinking and behaving in a specific activity in such a way that the process

becomes natural to the individual through repetition or practice. Onuka (2003) also observed that

a person who works productively is skilled because he has acquired the habit of performing a

task in all acceptable manners within his job. In the words of Osuala (2004), skill is the ability to

put into use acquired competencies, attitudes and behaviour after an exposure to theories and

practices inherent in a field of study. This implies that skills are acquired through exposure to

practice. Thus financial accounting teachers should not only teach the students the theoretical

aspect of accounting in the class rooms, students should be channeled to real life practices for

effective skill acquisition.

Commenting on effective skill acquisition,Isyaku (2003) observed that one way to

remedy the imbalance between education and employment is to direct educational effort towards

developing skills and attitudes conducive for employment. Nnachi (2007) also explained that an

individual may hardly be skilled in a task without exposure, training or practices. Skill

20

acquisition is very imperative for effective entrepreneurship management.Akpotowoh (2005)

noted that most small scale businesses fail not because they do not have the necessary capital but

because they lack the pre-requisite skills required to remain in because noting the causes of

business failure.Osuala (1993) also asserted that the causes of business failure includes;

management incompetence, lack of experience, unplanned expansion and unethicalbehaviour

among other things. It therefore, becomesmore imperative for senior secondary school students

to acquire the required basic financial accounting skills that will equip them to become better

managers of their own businesses oreven to work effectively in paid employment.

Financial Accounting

Financial Accounting is a branch of accounting that deals with collecting, recording,

analyzing and communicating financial data of a particular business to the users of such data.

American Accounting Association (AAA) in Kazeem and Longe (2000) defined financial

accounting as the process of recording, classifying, selecting, measuring, interpreting and

communicating financial data of an organization to enable users make assessments and

decisions. It is a process that deals with measurement and it involves the collection, classification

and presentation of information in monetary terms on economic activities, in the events,

transactions and communication of the information in appropriate form for internal and external

user groups (Ugwu, 2003). It is the measurement statement or provisions of assurances about

financial information primarily used by lenders, managers, investors, tax authorities and other

decision makers to make resources allocation decisions between and within companies,

organizations and public agencies (Wikipedia the free encyclopedia, 2011). Financial accounting

is very important in the financial management of any business.

21

Commenting on the importance of financial accounting in the financial management of

any business,Alagye (2013) noted that financial accounting helps to ascertain the profits of and

losses, income and expenditure any business; it also determines the growth and provide financial

information about the organization. Osuala (2004) identified that financial accounting helps to

understand the concepts of assets, liabilities and entrepreneurship so that the fluctuation in

business cycle may be correctly interpreted and business papers and records rightly analysed.

There are factors which no manager can ignore; it is very important that every entrepreneur

possess the basic or knowledge of accounting (Ezeani, 2012). According to the author, this

knowledge to the author, will help in reducing the rate at which small scale businesses go into

liquidation,Longenecker, Moore and Petty in Ademola, Olukotan, James and Ifedokpo (2012)

noted that research conducted in 1993 by Dun and Bradstreet company on the causes of business

failure showed that lack of financial accounting knowledge was 47.3 percent while economic

factor was 37.1 percent, neglect, fraud, disaster, strategy and experience was 3.8, 3.8,6.3,1.0 and

0.6 percents respectively.

Improper keeping of financial accounting records affects the growth and development of

any business. Financial accounting information is vital for showing indebtedness of a business.

In the business world today, majority of transactions are on credit basis and the use of the term

debit and credit throughout in financial accounting recognizes the importance of credit

transaction. Balty in Ali (2001) also recognized that banks and other financial institution who are

concerned with lending could ascertain the likely risk involved in granting a loan through

financial record keeping. Supporting this view,Osuala (1995) stated that there is correlation

between inadequate financial accounting record keeping and the business organization. Financial

accounting records have become the foundation on which the totality of modern businesses

22

depends on. This is because without these records, it will be impossible to ascertain the level of

business susceptibility to fraud (Ademola et.al, 2012). Various skills embedded in business

related programmes (financial accounting included) needed to be explored and learnt by its

prospective graduates for them to succeed as later entrepreneurs (Obi, 2009).

It takes special skills to succeed as an entrepreneur (Akinola, 2001). Anne Boyele in Ali

(2001) also observed that the possession of the required skills by the employees will make them

fit to work in any establishment in an organization and more especially have the opportunity of

becoming executives in future time if they are able to acquire and utilize the needed skills. Batty

in Ali (2001) noted that financial accounting has grown into its present form to meet a number of

requirements which includes: the need to supply information required by law. Financial

accounting information is vital for showing the indebtedness of a business. In the business world

today, majority of transactions are on credit basis and the use of the term debit and credit

throughout in financial accounting recognizes the importance of credit transaction.

Modern business organizations have employed accounting as a communication tool, a

control mechanisms, decision tool and aids. It also serves as a measurement of activity outcome

in monetary terms. Ajuogu in Ali (2001) supported this view by pointing out that, in our

contemporary societies;accounting has often been regarded and called the language of

businesses. The underlying idea of cash management is the attainment of business growth

through maximization of available funds. No wonder Brigharm in Ali (2001) regarded cash as

the oil that lubricates the wheels of businesses. The author further explained that management of

cash is crucial because business development is often constrained by shortage of productive

factors a critical one being capital. Cash can only be managed well through the use of proper

23

financial record keeping (cash book). Therefore, financial accounting skills are the basic

foundations of any successful business.

Financial Accounting Skills

Financial accounting skills that are pertinent to entrepreneurial successes as identified by

claautier and under down, Hodget, Ajayi, Reed in Ademola etal (2012) includes; source

documents (invoice, receipt, bank teller) which are recorded in subsidiary books (journals) and

posted to different ledgers (debtors, creditors and the general ledgers) and is checked by trial

balance and subsequently, the final reports (balance sheet). Igbo in Akpotowoh (2005) identified

some of the accounting and financial skills required by entrepreneur for successful operation of a

business enterprise as ability to know gross and net profit, prepare daily cash repots, final

account (profit and loss accounts and balance sheet) among others. Also commenting on the

financial skills,Agbonifoh (1999) maintained that in the competitive world, the key factors are

costs, prices, turnover and profits. At the senior secondary school level, the basic financial

accounting skills required for entrepreneurship development are the prime or subsidiary book

entry skills, the cash book entry skills, the bank reconciliation skill, ledger skills, the trading,

profit and loss account skills and the balance sheet skills(FRN,2011).

Prime or Subsidiary Book

The prime books are books of original entry or subsidiary books in which transactions

from source documents are recoded first before they are posted to the ledger. In line with the

above view,Akintelure and Oguobi (2003) defined prime books as the books of original entry or

primary books of accounts used to record all business transaction before posting to the ledger.

Ademola etal (2012) also saw prime books as descriptive and chronological day books (diary-

like) used in recording day to day financial transactions. Financial transactions are

24

businessactivities that deal with payment and receipt of cash on daily basis and those activities

whose settlement is to be done at a later date. Subsidiary books are used to make first entry of

transaction before posting into the ledger (Longe and Kazeem, 2012). Oguobi and Akintelure

(2003) also saw subsidiary books as the records of transactions entered in separate books mainly

for the purpose of listing and classifying the various transactions as they occur and to avoid the

risk of errors of omissions and direct entries in the ledger. The use of subsidiary books therefore

prevents the ledger from containing too much detail. The subsidiary books also assist in the

preparation of ledger, trial balance and final accounts. The subsidiary or prime books includes;

the sales day book or sales journal, purchases day book or purchase journal, return inward day

book or sales returns journal, returns outward book or purchases returns journal, journal proper

or general journal and the cash book

Sales Day Book or Sales Journal

This is a subsidiary book used in recording all sales of goods made on credit (goods not

yet paid for). The seller enters the sales day book from the sales invoice. An invoice is a source

document issued by the seller to the buyer describing the goods bought, quantity bought and the

price. The sales day book is not part double entry records because it is not an account. After

entering in the sales day book, the customer’s personal account is debited while the credit entry

to the sales account is usually delayed till the end of a stipulated period (which may be weekly,

monthly or quarterly), when the sales day book will be totaled and posted to the credit side of the

sales account in the general ledger posting to the credit side of the sales account (giving account)

completes the double entry principle which started with the debit entry in the customers personal

account (receiving account).

25

The sales day book gives the total amount of credit sales at a particular time.

Commenting on the ability of the students to be able to draw up a sales journal, Udo (2001)

stated that the ruling of the sales journal is the same with that of purchases journal but the

striking difference lies in the posting the items to the ledger. According to the author, the total of

the sales journal is always posted to the credit side of the sales account since the sales account is

giving out goods on credit.

Sales Day Book

Date Particulars/names Folio Detail Total

N N

X X

Total transferred to sales account XX

Figure: 1 Format of sales day book.

Source:Kazeem and Longe (2012)

The Purchases Day Book

The purchases day book is used for recording goods bought on credit from suppliers. The

credit purchases are listed in the purchases daybook as they occurs, the suppliers personal

account is credited while the debit to the purchases account is also delayed till the end of agreed

period by the owner (entrepreneur) when the total of the purchases day book is transferred to the

debit side of the purchases account (receiving account) as the double entry principle is completed

in the supplier’s personal account (going account). The purchases day book gives the total

amount of credit purchases at the end of a stipulated period of time. The skills in entering items

into the purchases journal includes: the ability to identify items to be posted into the book.

Commenting on this skill, Udo (2001) asserted that the particulars of items to be posted in the

26

purchases day book are usually copied from the invoice sent by the supplier. According to the

author, to the seller, it is the sales invoice, the particulars of which are entered in the sales journal

and to the buyer it isthe purchases invoice the particulars of which are entered in the purchases

journal.

Purchases Day Book

Date Particulars/Names Folio Detail Total

N N

X X

Total transferred to purchases account XX

Figure: 2 Format of Purchases Day Book

Source; Akintelure and Oguobi (2003)

Returns Inward Day Book or sales Returns Journal

This subsidiary book is used to record goods sold but later returned for reasons of

defective, under-size, irregular colour and others (Akintelure and Ogbuobi (2003). In this book,

the date the return was made, goods returned and the reasons for their return are recorded. Igben

(2009) noted that when customers return goods, “credit notes” are issued to the customers

indicating that their personal accounts are being credited with the value of goods they return

thereby reducing the amount being owed by them. In the return inward day book, all the credit

notes are listed at the end of a specified period and the total of the returns debited to the return

inward account in the general ledger while the corresponding credit entry will be in the

customers personal accounts. Also the return inward day book is outside the double entry

systems but prevents congestion of the ledger. Still on the ability to post items in the return

27

inward journal, Udo (2001) noted that trade discounts originally granted to a buyer by a supplier

are taken into consideration when entering the returns book. These according to the author must

be deducted from the list prices of the goods returned.

Format of Return Inward Day Book


N N

X X

Total transferred to return inward account XX

Figure: 3 Format of Return Inward Day Book

Source; Kazeem and Longe (2012)

Returns Outward Day Book or Purchases Returns Journal

When goods are returned to suppliers, “debit note” are issued to them to indicate that the

supplier’s personal account are debited with the value of goods returned to reduce the debt being

owed to them (Igben,2009). The debit notes are listed in the return outward day book and totaled

at a specified later date and transferred to the credit side of the return outward account while the

supplier personal account are debited.

Commenting on the timing skill in posting to the return outward journal, Longe and

Kazeem (2012) warned that return outward book is usually entered immediately goods are

returned as the return outward account is being credited, suppliers account is debited in the

ledger. The author stated that the particulars entered in the return outward day book are taken

from the credit note sent by the supplier of the goods and warned that the posting in the return

outward journal should not present any difficulty to the students as goods returned to a supplier

28

are regarded as if they are re-sold to him as such, the suppliers account is debited and the

corresponding credit entry made in the returned outward ledger account.

Returned Outward Day Book


N N

X X

Total transferred to return outward account XX

Figures: 4 Format of Returned Outward Day Book

Source:kazeem and longe (2012)

Journal Proper

The journal proper or general journal is used for the purpose of recording transaction

which because of their nature cannot be entered in any other book of prime entry (Akintelure and

Oguobi, 2003). These transactions include the purchases and sale of fixed assets on credit,

correction of errors, transfer from one account to another and other related transactions. Kazeem

and Longe (2012) defined journal proper as a book of prime entry used in recording initial

entries in chronological order. Initial entries are opening balances brought from ledger accounts

cash book which an entrepreneur closes the year with and is brought forward at the beginning of

the new accounting year. In the journal proper, transaction are entered and classified as Debit

(Dr) and credit (Cr) before they are posted to the ledger. The general journal has five (5) column

for data, particular or names, folio, debit and credit.

The general journal contains miscellaneous matters that cannot be conveniently group

together like purchases and sales of assets.Omuya (2011) stressing on the posting skill posited

that to standardize matters, that the name of the account to be debited should always be shown

29

first while the name of the account to be credited is written not directly under the name of the

account to be debited but inserted to the right hand side. This according to the author helps in the

reading of the journal. Also commenting onthe ability to explain the transactions that take place

in the narration should be clear and concise to enable users appreciates the nature of any

transaction journalized. Longe and Kazeem (2012) while stressing on the ability to enter items

into the journal proper noted that entries in the journal proper may be simple or composite.

According to the authors, simple entries involves one account to be debited while composite may

involve several accounts to be debited and only one account to be credited and vice versa.

Journal Proper or General Journal

Date Particulars/names Folio Dr Cr N N X X Figure: 5 Format of Journal Proper

Source:Udo (2011)

In the particulars column, the account to be debited comes first with (Dr) at the end and

the amount written at the debit column, followed by the account to be credited. A brief

explanation of the entry is given to show the nature of expenses made on credit, such explanation

is known as “Narration” which differentiates the general journal from other day books

Cash Book

The cash book is a subsidiary book as well as a ledger used in recording transactions

made in cash. As a subsidiary book, the cash book is used to decongest the ledger. With regards

to thisIgben (2009) noted that in a business organization, the function of receiving and paying

out money required a considerable number of entries and if posted directly to the ledger will

congest the ledger; the objective of decongesting the ledger is carried one step further by taking

the bank and cash account out of the ledger and combining both in one subsidiary book known as

30

cash book. As a subsidiary book, when an entry is made in the cash book, one side of the double

entry is completed; the remaining will be taken care of in the customer’s cash accounts. Unlike

other subsidiary book whose totals are being transferred to their ledger accounts.

When the cash book is treated as a ledger, the principle of double entry remains

unchanged. The principle stated that “in every debit entry, there must be a corresponding credit

entry and vice versa: A ledger, according to Longe and Kazeem (2012) is a book which contains

in a classified and summarized form, a permanent record of all transactions. According to the

authors, a ledger is divided into two parts by a vertical line. The left side of a ledger is called the

debit side or the receiving side while the right side is the credit side or the giving side. In the

debit side all cash or cheque received are being recorded and all cash payment or cheques are

recorded is the credit side. A cash book is a book used for recording the receipt of income and

trade payment of money either in cash, cheque, bank draft or postal orders (Akintelure and

Oguobi, 2003).

A Ledger Dr Cr N Receiving side

N Giving side

Figure: 6 Format of a Ledger Source: Researcher

The cash book is the only book that combines the functions of the subsidiary and

principal book. The types of cash book includes; the single column cash book, the two or double

column cash book, the three column cash book and the petty cash book.Longe and Kazeem

(2012) advised on the ability to post items correctly that in the preparation of the cash book,

students should write up the cash book first since the cash book is a prime book also before

transferring the items to the individual ledgers. This according to the author will make the work

31

easy and convenient. The authors further noted that in balancing the cash book, the balance

carried down (c/d) will be brought down (b/d) as closing balance which will be carried forward

to next month as opening balance. Cash book can be single column, double column, three

columns or a petty cash book.

The Single Column Cash Book

The single column cash book usually has one amount column for either cash or bank on

the debit and credit sides respectively. In this case, both the cash and bank columns are kept

independent of each other. All money received are recorded in the debit side while all expenses

made in cash are recorded in the credit side.

Single Column Cash Book

Dr Cr Date Particular Folio Amount Date Particular Folio Amount

N: K

N: K

Figure: 7 Format of a Single Column Cash Book

Source: Akintelure and Oguobi (2003)

Two or Double Column Cash Book

As the name implies, two column cash book is so-called on each side for cash and bank

transactions. A cash book that incorporates “Bank” and “Cash” columns on either side of the

account is a double column cash book (Akintelure and Oguobi, 2003). The double column cash

book therefore has ten (10) columns altogether, five (5) columns on each side consisting of the

date, particulars, folio, cash and bank columns.

32

On the debit side, cash received are recorded under the cash column while money

received in form of cheque is recorded in the bank column on the debit side. Also on the credit

side, all cash expenses made are recorded under the cash column while all expenses made by

cheque are recorded under bank column. A contra entry takes place in double column cash

book. A contra entry occurs when cash is taken from the office to the bank or when money is

withdrawn from the bank for office use. When contra entry happens, the double entry principle is

completed in the same cash book and at the same time and the letter (c) is written under the folio

column indicating contra entry.Let us assume that N1,500 is withdrawn from the bank for office

use on 12th. The posting will look as follows in double column cash book

Two Column Cash Book Dr Cr

Date Particulars Folio Cash Bank Date Particular Folio Cash Bank

12th

Bank

C

N

1500

N

12th

Cash

C

N N

1500

Figure: 8 Format of Two Column Cash Book

Source: Researcher

This means that on the credit side bank account is giving out money while on the debit

side cash account is receiving the same amount and the double entry completed with the letter (c)

at the folio column indicating a contra entry. This is an important skill in posting into the two

column cash book (Omuya, 2011) stated.

Three-Column Cash Book

A three-column cash book has a discount column added to the two: columns for bank and

cash. A discount is an amount deducted off the sum due from customer if he pays his account

within a stipulated period (Udo, 2011). Discount can be trade or quantity discount for quantity

purchase or cash discount for prompt payment of amount due at a stipulated time. The three-

33

column cash book has twelve (12) columns, size (6) columns on each side for date, particulars,

folio, cash, bank and discount allowed column at the debit side and discount received at the

credit side. Discounts are usually given in percentages and are deducted from the amount due for

the customer.

Three Column Cash Book

Dr Cr Date Particulars Folio Cash Bank Date Particular Folio Cash Bank

N N N N

Figure: 9 Format of Three Column Cash Book

Source: Researcher

The cash book is usually summed up. The summing up of the debit and credit side of the

cash book and finding of their differences is called balancing. When the bank balance is on the

credit side, it means that there is an overdraft. An overdraft occurs when a bank customer takes

more than what he has in the bank to meet urgent needs (Kazeem and Longe, 2012). When an

overdraft occurs, it is usually a liability in the balance sheet. On the ability of students to draw up

a three column cash book, Omuya (2011) noted that the discount column on the debit or left side

of the three column cash book is for discount allowed while that in the credit side is for discount

received.

The Petty Cash Book

A petty cash book is a subsidiary book where minor expenses are recorded (Akintelure

and Oguobi, 2003). In this system, a specified sum of money called Float is giving to a petty

cashier who uses it to settle minor expenses instead of bordering the cashier who keeps the cash

34

account for small expenses. At a specified period of time,say one week, one month or quarterly,

the petty cashier balancing the petty cash book and the amount spent be re-imbursed. This means

that at the beginning of every specified time the amount of the petty cash book remains the same

i.e always up to the initial total.

The petty cash book has two sides, debit and credit sides. On the debit side, the amount

received, the date is recorded while in the credit side the analysis of expenses incurred is

posted.On the ability to obtain the information to be posted to the petty cash book Omuya (2011)

asserted that each payment made by the petty cashier will have to be supported by a voucher

showing the reason for the payment and signed by the person receiving the money, so that the

voucher serves as the source of information for recording items into the petty cash book. And on

the ability to enter and balance the petty cash book, the author stated that the entries on the credit

side of thepetty cash book are first made in the total column, and then are extended into the

relevant expense column; and at the end of the period, the payments are totaled and that the total

on the total column must equate with the sum of the other payment totals. The author further

commented on the ruling of the petty cash book that the receipt column represents the debit side

and analysis column on the credit side.

Petty Cash Book

Dr Cr Date Particular Folio Amount

N

Date Particular Total Analysis

Postage

N

Sundry

N

Travelling

Expenses N

Miscellaneous

N

Figure: 10 Format of a Petty Cash Book

Source: Researcher The prime or subsidiary book as stated earlier helps the entrepreneur to decongest the

ledger accounts with details of information concerning credit sales and purchase of goods and

35

also assists to reduce the risk of omission of items while posting to the ledger. No entry is posted

directly to the ledger from the source documents but must pass through the prime books. The

journal and the ledger are the two principle books of account. A source document according to

Kazeem and Longe (2012) is a document that supports documentary evidence of business

transactions. They include; invoice, credit note, debit note, receipt, petty cash voucher and

statement of account. The subsidiary books assist in the preparation of the ledger, trail balance

and final accounts which includes the trading, profit and loss account.

Bank Reconciliation Statement

When a customer opens a current account with a bank, he will open an account in his

book showing his dealings with the bank. These consist of a bank column in his cash book. Also

the bank in question opens an account for the customer. The entries in the bank’s book will be on

the opposite sides to those as shown in the customer’s book. The book which the bank prepares

showing the transactions between it and it’s customer is “Bank statement” (Kazeem and Longe,

2012). A bank statement is a copy of a customer’s account in the bank which is send to the

customer periodically and contains a corresponding double entry of all the transactions in the

bank account (Akintelure and Oguobi, 2003). The bank column in the cash book and bank

statement shows the same transaction on opposite sides all things being equal. In practice, it is

noticed that there used to be differences in cashbook balances and the balances in the bank

statement. These differences are so because of timing of entries in accounts (Akintelure and

Oguobi, 2003). Thus the need to reconcile both books (customer’s cash book and bank

statement). Longe and Kazeem (2012) defined bank reconciliation statement as a statement that

is prepared to reconcile the disagreement of the cash book and that of the bank statement.

According to the authors, the timing and information differences which can cause disagreements

36

between the customers cash book and bank statement includes; unpresentedcheques,

uncreditedcheques, dishonouredcheques, bank charges, interest and standing order among other

things.

Before a bank reconciliation statement is prepared, the balances in the customer’s

cashbook and that in the bank statement must be equal; as such when a customer gets a statement

of his account from the bank, he checks for the activities the bank perform on his behalf which

he is not aware of or have forgotten and use them to adjust his cash book balance to tally with

that of the bank statement. In line with this, Igben (2009) stated that before a bank reconciliation

statement is prepared, the customer must ensure that both the cash book and bank statement are

written up at the same date; and update his cash book by crediting cash book with bank charges,

commission on turnover and draft, interest on loan and overdraft, standing order and

dishonouredcheque and by debiting dividend received, interest received and any other error

identified must be corrected in the cash book

Items used for the adjustment of the cash book for the preparation of bank reconciliation

statement are summarized below

Dr Adjusted Cash Book item Cr

Debit Credit

Interest received Bank charges

Dividend received Interest on loan

Trade credits Standing order

Errors’ in the cash book Dishnouredcheques

Error’s in the bank statement

Figure: 11 Adjusted Cash Book Items

Source; Researcher

37

When the cash book balance has been adjusted to tallywith the balance in the bank

statement, the bank reconciliation statement must begin with balance as per adjusted cash book

and end with the balance per bank statement. Hence the format below;

Balance as per adjusted cash book N X Add: Unpresentedcheque X X

Less uncreditedcheques/adjustment (X)

Balance as per bank statement X

Figure: 12 Format of Bank Reconciliation Statement

Source: Longe and Kazeem (2012).

The importance of bank reconciliation statement to small scale businesses is that it helps

the entrepreneur to check his account with the bank and also help to dictate error(s) and checks

fraudulent activities. Talking about error, Igben (2009) warned that an entrepreneur should

notifythe bank of its error(s) for correction immediately noticed; and that if the entrepreneur

finds out that unpresentedchequesremainsunpresented for too long, the entrepreneur should get in

touch with the payee to find out why. The author advised that if dead or lost that bank should be

notified not to honour the cheque to ensure that payment is not made to the wrong person(s).

Igbenfurther advised that if uncredited or lodgmentcheques remains uncredited for an

unreasonable period, that it should be taken up with the bank to make sure it has not been

credited in error to another account by the bank. Unpresentedcheques are cheques issued to

supplier(s) (payee) which they have not presented to the bank for payment while

uncreditedcheques are cheques which the customer presented to the bank for credit which has not

yet been done. The skill on the ability to prepare a bank statement, Longe and Kazeem (2012)

suggested that students can deal with bank statement from two perspectives: preparation of only

38

the bank reconciliation statement and the preparation using the adjusted cash book. The authors

further stated that in using adjusted cash book method, that any item that appeared in the

adjusted cash book will not be recorded again in the bank statement, Udo (2011) also advised

that in comparing the book with the bank statement that the items that appear in one are usually

checked against those that appear in the other by ticking, hence the ledger account rule.

LedgerClassification

An account is a record in a double entry system that is kept for each class of assets,

liability, revenue and expenses (Longe and Kazeem, 2012). The double entry principle as had

been stated earlier states that for every credit entry, there must be a corresponding debit entry

and vice versa. Basically, accounts are classified into personal and impersonal account (Igben,

2009). The author further stated that impersonal account is sub-divided into red and nominal

accounts. Having a contrary view,Udo (2011) classified account into three namely; personal

account, real account and nominal account. These classifications re the same by implication

because impersonal account is further sub-divided into real and nominal accounts.

Personal accounts are accounts owned by individual persons or individual firms that has

business dealing with the organization. They are accounts with names of individual and firms

written on their tops. Udo (2011) defined personal accounts as class of account that shows

dealings with persons. Examples of personal accounts include; debtors account, creditors

account, capital accounts, drawings account and bank accounts. In personal accounts, the rule of

double entry principle if applied is to debit the receive (debtor) and credit the giver (creditor).

Thus if goods are sold to Mr. Obi becomes the receiver (debtor) while Ayz enterprises becomes

the giver.

39

Account Classification

Figure: 13 Format of Account Class

Sources:Igben (2009)

Personal Account

Impersonal Account

Bank A/c

Creditor A/c

Debtor A/c

Capital account and drawing

Account

Nominal Account

Real A/c examples

building, furniture,

land, motor vehicle, stock

cash

Revenue Account

Expenses Account

Intangible assets

Account

40

As have been seen that every class of account has a rule for recording transactions into it

in obeying the principle of double entry. Items posted into ledger accounts needed to be tested to

make sure that the book-keeper does the right thing. The skills is the ledger classification

includes the ability to rule the ledger, title it and ability to identify which account to be debited

and the one to be credited. Stressing on these skills Udo (2011) urged students to commit to

memory the principle of “credit Giver” and Debit receiver”.

And on the ruling skill, the author noted that the ledger account is divided into two parts

by a central line and that the left side is the debit (Dr) side and the right side, credit side (Cr).

Omuya (2009) noted that title of an account is purely a matter of choice in a firm. According to

the author, the title of an account for postage stamps could be called “postage stamp account” or

“postage account” or “communication expense account”. And on the ability to balance up an

account, the author asserted that the two sides of the accounts are first added up, that the

difference between the side with greatest total and lesser side is usually inserted to the lesser side

so as to make the totals of the both sides equal. The author further warned that when doing this

that students should ensure that the two totals are written on the same level with one another. The

totals of accounts are further transferred to the trial balance.

Trial Balance

A trial balance is a list of balances in the ledger account gathered to test the accuracy of

the double entries as posted by the book-keeper. Akintelure and Oguobi (2003) viewed a trial

balance as a check of arithmetical accuracy of the book-keeping to test the double entry; whether

it has been completed in the ledger or not. It is a schedule that shows the debit and credit

balances extracted from the ledger to show the arithmetical accuracy of the ledgers. Commenting

41

on the importance of trial balance to the entrepreneurs, Igben (2009) stated that it serves as a

check on the “arithmetical accuracy” of the entries and also the basis upon which the trading,

profit and loss account and the balance sheet are drawn up. The author further warned that the

agreement of the trial balance does not mean that there are no errors in the entries because there

are some errors which do not prevent the trial balance from balancing.

A Trial Balance

Particular Folio Dr Cr

N

X

X

X

N

X

X

X

XX XX

Figure: 14 Format of a Trial Balance

Source: Researcher

As soon as an error(s) is/are dictated, it /they should be corrected immediately, but there

are cases where time cannot permit the staff or the book-keeper to correct the error immediately,

then the error is kept in a suspense account until it is corrected and once corrected, the suspense

account ceases to exist.

A suspense account is an account opened to take care of indicated error(s) that stops the

trial balance from balancing which ceases to exist as soon as the error is corrected. Angel fire in

Munirudeen (2003) defined suspense account as the account opened to take care of errors which

have caused an imbalance in the trial balance but which have not yet been dictated in the

business book. Vein, Galligan and Reid in Munirudeen (2003) explained that where the trial

42

balance does not balance, that there is the need to open a “General fix-it” account to sort it all

out. According to the authors, this account will show the difference between the sides of the trial

balance and that when everything is sorted; the account ceases to exist asthe difference will be

zero. This account, according to the authors, is a suspense account and further warned that it is

illegal to fix errors by deleting entries or crossing them out.

A suspense account is a temporary resting place for an entry that will end up somewhere

else once its final destination is determined (Stein, 2003). The suspense account if debited should

be shown on the balance sheet under current assets or if credit, under current liabilities.

Trading, Profit and Loss Account

Trading, profit and loss account constitutes part of the final accounts of a sole trader

(entrepreneur) or large firms as the case may be. It is two accounts merged in one. The trading

account is prepared to determine the gross profit or loss of a business at a particular time. Gross

profit is the profit obtained from sales less cost of goods sold. It is a profit got before expenses

incurred during the sales are being deducted. Kazeem and Longe (2012) viewed trading account

as a revenue account prepared to show the gross profit or gross loss of a business for a particular

period. According to the authors, the gross profit is the difference between sales and cost of

goods sold. Akinkelure and Oguobi (2003) sated that the gross profit or gross loss is arrived at

after charging the goods and materials and other items of direct cost. Direct cost according to the

author includes costs that can be traced directly to the sale or production of particular goods.

The gross profit figure can be used to compare the performance of a business with that of

another and helps in taking certain progressive business decisions with regards to pricing of

goods for sale. Profit as we know is the basic reasons for the establishment of any business and

when calculated, it is used to compare the actual profit from the expected profit and from the

43

decisions about the business is made. In the preparation of trading account, the balance in the

sales account which is usually a debit balance is being transferred to the credit side while the

balance in the purchases account which is always a credit balance is being transferred to the debit

side to complete the double entry principle. Stock account which usually has a credit balance is

also closed by bringing the balance to the debit side of the trading account as closing stock

deducted from goods available for sale. All the balances in the return inward account and return

outward accounts are also transferred to trading account in credit and debit sides respectively to

close the accounts.

Profit and loss account is the continuation of trading account. It is the part of final

account where net profit or net loss is being obtained. In the preparation of profit and loss

account, the gross obtained from trading account which is always a debit balance is transferred to

the credit side of profit and loss account. Also income or gains are credited while expenses are

debited. The difference between the credit side and the debit side gives the net profit or net

lossIgben (2009) described the net profit as the excess of all incomes over all expenses and net

loss as excess of all expenses over all income. The author maintained that, the income from sale

of goods are dealt with in the trading account while the incomes from other sources such as

interest received on bank deposits, discount received and rent received are dealt with in the profit

and loss account.

The author further stated that in the measurement of incomes for an accounting period,

that only the income earned as opposed to income received are recognized in the profit and loss

account. This implies that the net profit reported in the profit and loss account will not be the

same as the amount of cash in hand and at bank because of the fact that many of the incomes and

44

expenses in the profit and loss account are recognized in one accounting period while they are

actually received and paid in another period.

The net profit increases the capital of the entrepreneur. In view of this,Omuya and wood

(2009) noted that the credit entry for the net profit is always in the capital account. Supporting

this view,Longe and Kazeem (2012), stated that the net profit must be added to the capital

account and the net loss must be deducted from the capital account. The authors further

summarized the procedure for preparing trading, profit and loss account as follow:

• The revenue earned is the first item that will be recorded as sales on the credit side less

return inward.

• The statement contains a cost of goods sold section that shows the total cost of inventory

that was sold during the period.

• The cost of goods is deducted from sales to get intermediate or gross profit and

• That the operating expenses are subtracted from gross profit to determine net income or

net profit or loss. From trading, profit and loss account, the net profit or loss is added or

deducted from the capital account as the case may be and the capital account balance

forwarded to the balance sheet.

Commenting on the ability to name or title trading, profit and loss account shows the

results of a business for a period thus the title; profit and loss account for the year ended…….

While balance sheet shows the financial position of a business at a certain date hence the title

balance sheet as at (date/month/year). And on the ability to calculate the gross profit Udo (2011)

warned that great care should be taken to see that correct valuation is placed on the closing stock

45

as any wrong valuation will certainly affect the gross profit. The author further stressed that

stock should be valued at the cost price or at market value. Udo further advised that wages could

be debited to reading account if it is a production concern or debited to profit and loss account if

it office wage: But if different accounts are kept for salaries and wages, should be debited to

trading account and salary to the profit and loss account.Omuya (2009) also stated that revenue

isthe opposite of expenses and therefore appears on the opposite side to expense in the profit and

loss account. The net profit got from the profit and loss account is usually transferred to the

balance sheet.

The Balance Sheet

A balance sheet is a statement that shows the value of assets owned and the value of

liabilities owed by a business enterprise at a particular period of time. Balance sheet is not an

account: it is a statement showing the balances remaining in the books of accounts. It is a

statement of assets and liabilities at a particular moment showing the solvency or insolvency of a

business concern at a particular time (Akintelure and Oguobi, 2003). The balance sheet shows

the value of assets and liabilities and the ability or inability of the business to meet its financial

obligations.

Assets are values that belong to a business. They are resources owned and used by a

business organization for the purpose of generating income. An asset yields future economic

benefits to the business organization owning it (Igben, 2009). An asset may be fixed or current.

Fixed assets are assets whose useful economic life exceeds one year. They are assets which are

of permanent nature and they create more revenues for the business. Examples of fixed assets

are: furniture, land, building, motor vehicles, machineries and others. Current assets are assets

whose useful economic life does not exceed one year. They exist for only a short time before

46

they are transferred into other kind of assets. Igben (2009) viewed current assets as assets whose

composition constantly changes. According to the author, current assets change from cash at

bank or in hand to stock when goods are purchased for resale; then to debtors when the goods are

sold on credit and back to cash at bank or in hand when the debts are collected. Current assets

sometimes are referred to as circulating assets because of their transformation nature. The value

of fixed assets are reduced its value as it is continuously being used. Sometimes depending on

the nature of the business, these reductions in value used to be provided for as depreciation.

Companies and allied Matters Act (C.A.M.A) 1990 stipulated that provisions be made on

the depreciation of assets, bad and doubtful debts and on debtors. On the balance sheet, these

provisions are deducted from the assets to which they relate. Provision for depreciation is

deducted from the cost or revalued amount of fixed assets to obtain the net book value of the

fixed assets while both provision for bad debt and provision for discount on debtors are deducted

from gross value of debtors to obtain thereliable value of debtors. Depreciation is the gradual fall

in the value of a fixed asset arising from wear and tear, passage of time and Obsolescence. Longe

and Kazeem (2012) defined depreciation as deduction in the economic service potential of an

asset as a result of wears, tears, passage of time. The authors further stated that when fixed assets

are sold, part of cost not recovered is termed depreciation and that the amount changed as

depreciation can be used for the replacement of the assets at the end of the useful life. The wear

and tear is a physiological factor like erosion, dampness, rust and decay which can cause an asset

to reduce in value. Depreciation of assets can be calculated using straight line method, reducing

or diminishing balance method among other methods.

Liabilities on the other hand are amounts owed by the business to outsiders. They are

claims by outsiders over the assets of the business. Akintelure and Oguobi (2003) defined

47

liabilities as the value or amount which a business is legally bound to pay. It is the indebtedness

of the business to outsiders and the claim on the assets of an enterprise. Liabilities can be long

term or current in nature. Current liabilities are amounts payable within a short period of time,

usually within one year. Examples of current liabilities are creditors, bank overdraft, bills

payable, loan and others while long term liabilities are amounts expected to be paid after one

year. They include long-term loan and debentures.

The balance sheet layout is framed with capital and liabilities on the left-hand side of the

T account format and the assets on the right-hand side. Capital is the original fund or amount

with which an entrepreneur entered a business with in addition to any profits retained inthe

business. It is the excess of assets over liabilities should the liabilities exceed the assets, this

results into “Deficiency” and the entrepreneur’s account would be represented by a balance on

the assets side indicating a state of insolvency (Longe and Kazeem, 2012). This means inability

to perform its financial obligations. The skill in the balance sheet is including the ability to

identify different types of assets and the ability to post them correctly at the right place stressing

on these skills Udo(2011) warned that assets in any balance sheet must be arranged in a logical

sequence beginning with the fixed assets with the permanent as the first item. Following this rule

according the author, Goodwill should appear before land and building, furniture and fittings

before motor van etc.Current assets begins with stock and ends with cash in hand which is the

most liquid of all the assets.

The ability to prepare Trading, profit and loss account and the Balance sheet statement is

one skill in financial accounting and the ability to analyse and interpret these accounts to be able

to take valid business decision is another skill. From the balance sheet, the entrepreneur needs

the interpretation skill to be able to analyse the financial position of a business at a particular

48

time. The entrepreneur should be able to calculate and interpret profitability and liquidity ratios.

Ratio, according to Kazeemand Longe(2012), is the relationship that exists between two figures.

The authors commenting on the importance of accounting ratio stated that it is used in the

interpretation of financial statement and provide mean by which various items in the final

accounts are compared to other items.

The profitability ratio measures profit earned over the period and the capital employed at

the end of the same period. It includes, gross profit percentage ratio, net profit percentage ratio,

return on capital ratio and turnover ratio. The profit ability ratio shows the effectiveness of the

management. Fluctuation can occur in the ratio when there is change in selling prices, volumes

of output and changes in stock valuation basis (Longeand Kazeem, 2012). All these financial

accounting skills are taught in the senior secondary schools.

Senior Secondary Schools/ Accounting Teachers

Senior secondary school education is a post basic education given to children after

completing the basic education at primary and junior secondary schools. It serves as final

foundation laying point for further careers of children. The National Policy on Education (2013)

section 3 sub-section 35 classified senior secondary education as a post – basic education and

career development (PBECD). The policy therefore, defined post-basic education and career

development as the education children receive after a successful completion of ten year of basic

education .This implies that at senior secondary school level children starts to build up their

future careers based on the training they receive.

One of the objectives of post basic education, as stated by the National policy on

education (2013), is to provide entrepreneurs technical and vocational job specific skills for self-

reliance and for agricultural, industrial, commercial and economic development. This also means

49

that at the end of senior secondary education, children supposed to have acquired the basic skills

that will equip them to be self- reliance.

Financial Accounting and Book keeping is one of the subjects marked as

entrepreneurship subjects by the national policy on education (2013) which will assist in

achieving the stated goals. One of the objective of studying financial accounting at senior

secondary school is to enable the students understand basic accounting principles for modern

business activities. Also the senior secondary education curriculum in Business studies volume 4

stated the general objectives of book-keeping and Accounting as to provide fundamental

instruction to help students assume their economic role as consumers, workers and citizens. In

order to achieve these objectives, financial accounting teachers has much role to play.

Financial accounting teachers in senior secondary schools has to rededicate themselves to

their job by always planning their lessons before attending classes for easy flow of the lesson.

Supporting this view,Akintelure(1998) asserted that financial accounting teacher’s effectiveness

in instructional delivery depends on their consideration of the nature of the subject during

instructional planning. This implies that teachers of financial accounting should always devote

time to instructional planning considering the nature of the subject. According to the author,

financial accounting is not a subject that can be mastered by mere memorization of the basic

rule; it requires total involvement of the learner in the learning process in sound theoretical

knowledge and intensive practice in application of the basic principles. Thus teachers should

plan their lessons in such a way that student’s activities and practices are included for better skill

acquisition.

Commenting on the importance of practice by student in financial accounting class, obi

(2005) observed that practices does not make perfect rather practices exposes the individual to

50

the possibility of learning by creating avenue for correction whenever mistake is made.Olaitan

and Mama (2000) also posited that it should be a deliberate attempt for the accounting teachers

to arrange and document classroom instructional activities in order before implementation.

Teaching involves planning methods (Offorma, 1994).

Financial accounting teachers in senior secondary schools should always employ

different instructional methods in the classroom for effective teaching and learning. Practical

methods, field trip, discovering method and lecture method among others are some of the

methods that can be employed by financial accounting teachers while teaching to ensure the full

participation and exposure of students to activities. Aliyu (2000) identified discussion method,

teacher explanation method, and demonstrative method, individual and group study methods as

methods appropriate for teaching financial accounting in senior secondary schools. Brooner

(2000) also suggested that the specialist and generalistic approaches are best for teaching

financial accounting. According to the author, the specialist approach focuses attention of the

teacher in producing professional in accounting class while generalistic view believed that

financial accounting should be taught as a language of business to meet the needs of those who

study it for personal use. The way a teacher presents a subject matter determines whether the

learner will like or dislike the subject (Onwuka in Ekahasemomhe, 2006). Therefore, as trainers

of future entrepreneurs at the senior secondary schools, financial accounting teachers should

endeavor to inculcate the necessary competences into the students by planning their lessons

appropriately and by using appropriate teaching methods. Brone (2006) noted the things to be

developed by teachers early in an accounting class as creation of a pleasant, yet business like

atmosphere to enable attractive and appropriate learning environment.

51

Senior Secondary School Students

Basic financial account skills required

Prim

e B

ook

Ent

ry S

kill

Cas

h B

ook

Ent

ry S

kill

Ban

k R

econ

cilia

tion

Ski

ll

Ledg

er S

kill

Tra

ding

, Pro

fit a

nd L

oss

Acc

ount

Ski

ll

Bal

ance

She

et S

kill

Entrepreneurship Development

Self or paid Employment

Self reliance and

Improved Standard of living

Figure 15: Schematic diagram of basic financial accounting skills required for entrepreneurship

development by senior secondary students.

Source:Researcher

52

The schematic frame work in figure 22 presents a view point of the basic financial

accounting skills required for entrepreneurship development by senior secondary school

students. The frame work dipitched that these basic financial accounting skills when fully

impacted into the senior secondary students will help to develop in the senior secondary school

leavers the entrepreneurship skills that will enable them to grow and manage their own

businesses.

These businesses when managed effectively with the knowledge gained from these

financial accounting skills will grow and stand to make the secondary school graduates self-

reliance and create jobs for others. The skills will assist the students to even fit in to paid

employments or jobs and in turn improve their standard of living and reduce poverty level

among the youth while some ill practices among the youths in the society will also reduce.

Theoretical Frame work

The following theories were reviewed; Need Achievement theory and Risk taking theory.

Need Achievement Theory

David Mcclelland postulated the need achievement theory in 1965. The theory stated that

there would be a relatively greater amount of entrepreneurial activities in the society where the

average level of need for achievement is relatively high. This psychological theory shows the

functionality of strong relationship between need to achieve economic development (N-

Achievement) and entrepreneurial activities. This theory is related to the current study in the

sense that various economic needs among senior secondary students in Anambra state will

motivate the youth towards identify wasting potentials around them and try to exploit them for

their economic development.

53

Risk Taking Theory

The risk taking theory was postulated by Richard Cantillon in 1848. The theory stated

that the entrepreneur is a specialist in taking on risk. He “insures” workers by buying their

products (labourservices) for resale before consumers have indicated howmuch they are willing

to pay for them. According to the theory, workers receive an assured income, while the

entrepreneur bears the risks caused by price fluctuation in the consumer market. This theory is

related with present study because it points to the fact that business is all about risk and to reduce

the amount of risks to be taking by the entrepreneurs (senior secondary students) financial

accounting skills are very necessary for effective decision making and will encourage the

entrepreneurs to always calculate risks and takes the most profitable ones.

Related Empirical Review

Ohachosim, Onwuche and Titus (2013) studied financial challenges of small and

medium-sized enterprises (SMEs) in Nigeria. A descriptive research design aimed at discovering

the importance of accounting information to small and medium sized businesses and to identify

the problems facing their growth. Using stratified random sampling technique and questionnaire,

the researchers collected the data from registered entrepreneurs. The collected data was analyzed

using standard deviation while the null hypothesis was tested using t-test at 0.05 level of

significance. This study is related to the present study in their topic contents as both of them

dealt with small and medium scale businesses. They are also related in their methods of data

collection and analysis, and the type research design they adopted. Both studies differed in their

areas of study, their populations and in the objectives of their studies.

Amoako (2013) conducted research on the accounting practices of small and medium

enterprises (SMEs) in Ghana. The purpose of the study was to discover the level of accounting

54

practices by SMEs in Ghana. The study adopted descriptive research design; using convenience

sampling technique the researcher sampled managers and entrepreneurs of SMEs. The data

collected through questionnaire was analyzed using percentages while the hypothesis was tested

at 0.05 level of significance using t-test. The study revealed that SMEs owners do not keep

proper accounting records and recommended among other things that keeping accounting

records should be made mandatory for all SMEs in Ghana. The study under review is related to

the present study in the method of data collection and analysis and also in the contents of their

topics for both of them is concerned with financial accounting issues of the SMEs.They also

differed on their areas of study, objectives of their study, population of their studies and in the

sampling technique adopted.

Ademola, Oluuotun, James and Olore (2012) studied the role of record keeping in the

survival and growth of small scale enterprises inKogi state. The objective of the study was to

examine the role of record keeping in the growth and survival of SMEs and to determine the

records to be kept and the basic features of such records. The researcher used purposive sampling

technique to select the respondents from registered entrepreneurs and collected the data using

questionnaire. The collected data was analyzed using percentages while the null hypothesis was

tested at 0.05 level of significance using chi-square. The study discovered that owners of SMEs

in Kogi State do not keep records of their transactions and so cannot determine the growth of

their businesses and recommended that entrepreneurs should employ account clerks who are

knowledgeable in book-keeping. The study under review is related with the present study in the

content of their topics and they also adopted descriptive research design. They also related in

their method of data analysis and differed in their population, while the study under review

55

entrepreneurs, the present study intends to use teachers. They also differed in their methods of

data analysis and their areas of study.

Abdualrahim, Adenola, Oyebola, Muhtar and Abogun (2012) studied Accounting

principles of small enterprises inKwara state, Nigeria. The objective of the study was to

investigate if proper accounting records are being kept by SMEs owners. The researchers

adopted descriptive research design and used simple random sampling technique to select their

respondents from registered entrepreneurs and analyzed the collected using percentages while

the hypothesis was tested using t- test. The relatedness of the two studies is in their topic

contents, the design of the study adopted, and methods of their data collection and analysis. The

studies differed in their area of study and in the type of sampling technique adopted.

Yahaya, Osemene and Salman (2011) conducted a study on improving the accounting

practices adopted by owners of small and medium scale enterprises in Kwara State Nigeria. The

objective of the study was set to obtain a broad view of the accounting practices being employed

by SMEs in KwaraState The researchers adopted a descriptive research design and collected

their data using questionnaire. The data collected from entrepreneurs in the state through

sampling was analyzed using mean and standard deviation while the hypothesis was tested using

t- test at 0.05 level of significance. The study discovered that majority of the SMEs owners in

Kwara state do not follow proper accounting procedure and recommended among other things

that SME owners should always prepare cashbook, trading, profit and loss account and balance

sheet. The study under review is related to the present study in their design of study adopted,

methods of their data collection and analysis and in their topic content. The studies also differed

in their population, objectives of their studies and in their areas of study.

56

Summary of Literature Reviewed

The concept of entrepreneurship, financial accounting, skill, accounting teachers, senior

secondary school and related empirical studies were reviewed in this study and the review

revealed that entrepreneurship is the major driver for economic growth and development in the

developed and developing nations and that many entrepreneurship businesses collapses within a

short period of their establishment because of lack of proper financial accounting skills.

Also, Need Achievement and Risk Taking theories were reviewed. The need achievement

theory stipulated that the increase in the average need of the society will motivate the youths

towards scanning for wasting potentials around them and tap them while the risk taking theory

presents the entrepreneur as a risk taker whom financial accounting will help to always calculate

the cost of his risk and undertake the most profitable ones. All the empirical studies reviewed

showed that the studies were to either ascertain the accounting practices by SMEs or the role of

record keeping in the survival of small and medium scale enterprises. None was carried out to

actually determine the financial accounting skills that are actually required for entrepreneurship

development which is the gap this study is set to fill, thus the need for this study.

57

CHAPTER THREE

METHODOLOGY

This chapter describes the procedure employed in this study under the following sub-

heading: design of the study, area of the study, population for the study. Sample and sampling

technique, instrument for data collection, validation of the instrument, reliability of the

instrument, method of data collection and method of data analysis.

Design of the Study

The descriptive survey research design will be adopted for the study. Osuala (2004)

described descriptive survey design as a method used to obtain vital facts about people; their

beliefs, opinions, attitudes and behavior. This design is most appropriate and suitable to this

study as it will enable the researcher together the opinions of accounting lecturers and accounting

teachers on the basic financial accounting skills required for entrepreneurship development of

senior secondary school students using questionnaire.

Area of Study

The area of this study is Anambra state which is in the eastern part of Nigeria. It is one of

the largest commercial states in Nigeria that inhabits the largest market in West Africa in Onitsha

and another fast growing market in Nnewi .Therefore Anambra state is chosen for this study

because of the fast growth of small and medium scale businesses in the state.

Population for the Study

The population for the study is two hundred and seven respondents. This comprised of

118accounting teachers in the government owned secondary schools in Anambra state and 89

accounting lecturers in public higher institutions in the state of study (See Appendix A). The

sources of the population information are offices of the head of the departments of the various

57

58

higher institutions in Anambra State and statistic department of Anambra State ministry of

education respectively. This population is chosen by the researcher because accounting teachers

in secondary schools are knowledgeable in financial accounting and deals directly with the

students. Also, the accounting lecturers in the higher institutions train the secondary school

teachers and have the knowledge of the purpose of the study.

Sample and Sampling Technique

The population of this study is of manageable size and so no sampling technique will be

employed by the researcher. The entire population will therefore be studied.

Instrument for Data Collection

The instrument that will be used for the collection of data for this study is structured

questionnaire titled “Basic Financial Accounting Skills Required for Entrepreneurship

Development” (BFASRFED). It will be used to discover the opinion of the respondents on the

basic financial accounting skills required by senior secondary schools students. The

questionnaires contained a list of 65 skilled items grouped into eight clusters section A - G.

Section A was designed to obtain background information about the respondents. This

section contained two questionnaire items with options and blank spaces that would enable the

respondents to tick as appropriate. Section B addressed research question one with items 1-10.

This section was used to determine the prime book entry skills required by senior secondary

students for entrepreneurship. Section C dealt with research question two with items 11-20. This

section was used to determine the opinions of the respondents on the cash book entry skills

required for entrepreneurship development by senior secondary students. Section D dealt with

research question three with items 21-30. This section was used to determine the opinions of the

59

respondents on the bank reconciliation statement skills required by senior secondary students for

entrepreneurship life development.

Section E addressedresearchquestion four with items 30-40. This section seeks the

opinions of the respondents on the ledger skills required for entrepreneurship development by

senior secondary students. Section F seeks to obtain the opinions of the respondents on the

trading, profit and loss skills which were research question five with items 40-50. Section G

addressed research question six with items 50-60. This section also seeks to determine the

balance sheet skills required for entrepreneurship development of senior secondary students.

The items is sections B, C, D, E, F, and G were structured on a five point scale rating

with response options as: very much required (5), “much required (4)” “ Averagely required (3)”,

“somewhat required (2)” and “not required (1)” were used. Figures in brackets are values of each

response options.

Validation of the Instrument

The instrument was face validated by three experts from the Department ofVocational

Teacher Education, University of Nigeria Nsukka. Suggestions fromvalidates were used to

improve the final draft of the questionnaire. Therefore, the initial 65 items were increased to 75

while the initial sections B to G were reduced to F.

Reliability of the Instrument

Cronbach Alpha method will be used to establish the internal consistency of the

instrument for this study. The instrument will be administered to 20 respondents made of 14

secondary school teachers and 6 accounting lecturers in Enugu state. This is because Enugu state

hasthe same geographical characteristics with the place of the study.

60

Method of Data Collection

The instrument will be administered to the respondents by the researcher with the help of

two trained research assistants who will be briefed on how to guide the respondents to respond to

the questions. Completed copies of the instrument will be collected from the respondents one

week after distribution.

Method of Data Analysis

The collected data will be analyzed using mean ( ) and standard deviation, while the real

limit of numbers will be used in taking decision as follows:

Response Category Points

Very much required 4.50-5.00

Much required 3.50-4.49

Averagely Required 2.50-3.49

Somewhat required 1.50-2.49

Not required 1.00-1.49

From the table above, any response that fall between1.00 to 2.49 will be considered not

required because they are below average. Also, all the responses that falls from 2.50to 5.00 will

be considered to be required. The hypothesis will be tested at 0.05 level of significance using t-

test. Significance levels below 0.05 will be rejected while significance levels at 0.05 and above

will be accepted. However, low standard deviation will show correlation while high standard

deviation will show no correlation in the agreement of the respondents. The total number of 196

questionnaires was recovered out of 207 copies administered and analyzed.

x _

61

CHAPTER FOUR

PRESENTATION AND ANALYSIS OF DATA

This chapter presents the analysis of data collected in the course of the study. The

presentation and analysis is organized in tables and arranged according to research questions and

hypothesis formulated for the study.

Research Question 1

What are the prime book entry skills required for entrepreneurship development by

senior secondary school students of Anambra State?

The data for answering this research question was presented in Table 1.

Table1

Mean and standard deviation of responses of accounting teachers and lecturers perception of the prime book entry skills required for entrepreneurship development by senior secondary school students of Anambra State.

S/N Items statement Χ SD Remark

1. Ability to list the prime books 4.26 0.87 VMR 2. Ability to identify credit transactions 4.39 0.90 VMR 3. Ability to identify items that are entered into the sales day book 4.44 0.79 VMR 4. Ability to post items into the sales day book 4.42 0.66 VMR 5. Ability to transfer the total sales day book to the appropriate side of the sales account 4.15 0.91 VMR 6. Ability to identify items to be entered into the purchases day book 4.29 0.90 VMR 7. Ability to post items into the purchases day book 4.17 0.92 VMR 8. Ability to transfer the total of purchases day book to the appropriate side of the

purchases account 4.22 0.92 VMR

9. Ability to identify items of return inward 4.10 0.92 VMR 10. Ability to post items into the return inward day book 4.00 1.08 MR 11. Ability to transfer return inward total to the appropriate side of the return inward

account 4.12 0.96 VMR

12. Ability to identify items of return outward 4.00 0.96 MR 13. Ability to post items into the return outward day book 4.00 0.96 MR 14. Ability to transfer total of return outward to the appropriate side of the return outward

account 4.10 1.01 VMR

15. Ability to identify items to be posted to the journal proper 4.21 0.96 VMR

16 Ability to identify accounts to be debited or credited in the journal proper 4.28 0.92 VMR 17 Ability to write narrations of entries in the journal proper 4.21 0.96 VMR Cluster Summary 4.20 0.92 MR

Key: VMR =Very Much Required: MR = Much Required; AR = Averagely Required.

61

62

Data presented in Table 1 showed that items 1, 2, 3, 4, 5, 6, 7, 8, 9, 11, 14, 15, 16 and 17

had their means ranging from 4.10 to 4.44 while items 10, 12 and 13 had 4.00 as their mean

range. These mean ratings are above the cut-off point of 2.50 and therefore considered as being

very much required and required respectively for entrepreneurship development by senior

secondary school leavers in Anambra State. Also the data showed low standard deviation which

ranges from 4.66 to 1.08. This indicated that the response of accounting lecturers are closely

related to the mean response of accounting teachers on the prime book entry skills required for

entrepreneurship development by senior secondary school students in Anambra State.

Research Question 2

What are the cash book entry skills required for entrepreneurship development by

senior secondary school students of Anambra State?


63

Table2

Mean and standard deviation of responses of accounting teachers and lecturers perception on the cash book entry skills required for entrepreneurship development by senior secondary school students of Anambra State.


1 Ability to draw up a cash book columns 4.47 0.75 VMR

2 Ability to identify cash transactions 4.57 .77 VMR

3 Ability to identify the debit and credit entries of the cash book 4.57 .74 VMR

4 Ability to identify credit and debit balances in the cash book 4.43 .78 VMR

5 Ability to identify kinds of cash book 4.13 .88 VMR

6 Ability to post items into the cash book 4.15 .99 VMR

7 Ability to make a contra entry in the both debit and credit sides of

the cash book

4.22 1.03 VMR

8 Ability to calculate and deduct cash discounts in the cash book 4.30 .86 VMR

9 Ability to post and cast items in the cash book correctly 4.23 .99 VMR

10 Ability to balance the cash book 4.53 .67 VMR

Cluster Summary 4.36 0.85 VMR

Key: VMR =Very Much Required: MR = Much Required; AR = Averagely Required

Data presented in Table 2 showed that items 1, 2, 3, 4, 5, 6, 7, 8, 9 and 10 had their

means ranging from 4.13 to 4.57 which is above the cut-off point of 2.50 and thus be considered

as being very much required for entrepreneurship development by senior secondary school (111)

leavers in Anambra State. Also the data showed a low standard deviation that ranges from 0.67

to 1.03. This also indicated the response of accounting lecturers are closely related to the mean

responses of accounting teachers on the cash book skills required for entrepreneurship

development by senior secondary school students in Anambra State.

64

Research Question 3

What are the bank reconciliation statement skills required for entrepreneurship

development by senior secondary school students of Anambra State?

The data for answering this research question was presented in Table 3

Table3

Mean and standard deviation of responses of accounting teachers and lecturers perception on the bank reconciliation statement skills required for entrepreneurship development by senior secondary school students of Anambra State.


1 Ability to identify items that cause discrepancy between cash book

and bank statement

4.48 .77 VMR

2 Ability to adjust the cash book balance 4.46 .81 VMR

3 Ability to identify unpresentedcheques 4.22 .99 VMR

4 Ability to identify uncreditedcheques 4.33 .92 VMR

5 Ability to identify errors in the cash book 4.39 .87 VMR

6 Ability to identify errors in the bank statement 4.41 .81 VMR

7 Ability to prepare the bank reconciliation statement 4.33 .91 VMR

8 Ability to balance the adjusted cash book 4.25 .92 VMR

9 Ability to reconcile the cash book and the bank statement using

the identified items that cause the error

4.18 1.02 VMR

10 Ability to write up bank statement and cash book at the same date 4.25 .95 VMR

11 Ability to identify the items to be added or deducted from the

adjusted cash book

4.42 .78 VMR



65

Data presented in Table 3 showed that items 1, 2, 3, 4, 5, 6, 7, 8, 9, 10 and 11 had their means

ranging from 4.18 to 4.48 which is above the cut-off point of 2.50 and therefore considered as

being very much required for entrepreneurship development by senior secondary school (111)

students in Anambra State. Also the data showed a low standard deviation ranging from 0.77 to

1.02, which also indicated that correlation existed between the response of accounting teachers

and accounting lecturers on the bank reconciliation skills required for entrepreneurship

development by senior secondary school students

Research Question 4

What are the ledger skills required for entrepreneurship development by senior

secondary school students of Anambra State?

The data for this answering research question was presented in Table 4.

Table4

Mean and standard deviation of responses of accounting teachers and lecturers perception of the ledger skills required for entrepreneurship development by senior secondary school students of Anambra State.

S/N Items statement Χ SD Remark 1 Ability to identify personal accounts 4.45 .74 VMR 2 Ability to adjust the cash book balance 4.23 .92 VMR 3 Ability to post transactions into different classes of account correctly 4.38 .76 VMR 4 Ability to balance each account correctly 4.37 .86 VMR 5 Ability to transfer the balance of each account to the trial balance 4.28 .83 VMR 6 Ability to observe the double entry principle in the ledger 4.29 .98 VMR 7 Ability to draw the trial balance for ledger account 4.35 .78 VMR 8 Ability to identify the giver and receiver of values in each transactions 4.24 .96 VMR 9 Ability to draw up a trial balance 4.39 .84 VMR 10 Ability to transfer balances from different ledger account into the trial balance 4.18 .95 VMR 11 Ability to identify errors that affect the trial balance 4.18 .97 VMR 12 Ability to identify errors that does not affect the trial balance 4.10 1.10 VMR 13 Ability to correct errors 4.00 1.11 VMR 14 Ability to transfer errors not identified to the suspense account 4.10 .91 VMR 15 Ability to add up the totals of the trial balance 4.17 .91 VMR 16 Ability to identify accounts with debit balances 4.11 1.02 VMR 17 Ability to identify accounts with credit balances 4.18 1.00 VMR 18 Ability to title the trial balance 4.27 .95 VMR Cluster Summary 4.24 0.87 VMR


66

Data presented in Table 4 showed that items 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15,

16, 17 and 18 had their means ranging from 4.10 to 4.45 which is above the cut-off point of 2.50

and therefore considered as being very much required for entrepreneurship development by

senior secondary school (111) students in Anambra State. The data also showed correlation in

the responses of the respondents on the ledger skills required for entrepreneurship development

by senior secondary schools evidenced in low standard deviation of the range 0.74 to 1.11.

Research Question 5

What are the trading, profit and loss account skills required for entrepreneurship

development by senior secondary school students of Anambra State?


Table5

Mean and standard deviation of responses of accounting teachers and lecturers perception on the trading, profit and loss account skills required for entrepreneurship development by senior secondary school students of Anambra State.


1 Ability to identify items that make up trading account 4.54 .62 VMR 2 Ability to prepare a trading account to determine cost of goods sold 4.62 .61 VMR 3 Ability to obtain the gross profit or loss in trading account 4.52 .66 VMR 4 Ability to identify expenses associated with profit and loss account 4.49 .75 VMR 5 Ability to identify the business incomes and add them to the gross profit correctly 4.40 .87 VMR 6 Ability to transfer gross profit from trading account to the profit and loss account 4.32 .87 VMR 7 Ability to add provisions to the sides of profit and loss account correctly 4.41 .76 VMR 8 Ability to obtain the net profit or loss in profit and loss account 4.34 .73 VMR 9 Ability to cast out the items in trading, profit and loss account correctly 4.36 .70 VMR

10 Ability to calculate goods available for sale in the trading account 4.32 .89 VMR 11 Ability to deduct expenses in the profit and loss account 4.49 .79 VMR



67

Data presented in Table 5 showed that items 1, 2, 3, 4, 5, 6, 7, 8, 9, 10 and had their

means ranging from 4.32 to 4.62 which is above the cut-off point of 2.50 and therefore

considered as being very much required. Also the data showed a low standard deviation which

ranges from 0.61 to 0.89. This also indicated that the response of accounting lecturers are closely

related to responses of accounting teachers on trading, profit and loss account skills required for

entrepreneurship development by senior secondary school students in Anambra State.

Research Question 6

What are the balance sheet skills required for entrepreneurship development by senior

secondary school students of Anambra State?


Table6

Mean and standard deviation of responses of accounting teachers and lecturers perception on the balance sheet skills required for entrepreneurship development by senior secondary school students of Anambra State.


1 Ability to differentiate between assets and liabilities 4.62 .74 VMR

2 Ability to identify different types of assets and liabilities 4.39 .80 VMR

3 Ability to transfer net profit from the profit and loss account to the balance sheet 4.40 .67 VMR

4 Ability to calculate and deduct depreciations from fixed assests 4.21 .93 VMR

5 Ability to name the balance sheet appropriately 4.30 .88 VMR

6 Ability to prepare the balance sheet for internal use and for publication 4.13 1.09 VMR

7 Ability to enter the balance sheet items orderly 4.24 .84 VMR

8 Ability to balance up the balance sheet 4.41 .87 VMR



68

Data presented in Table 6 showed that items 1, 2, 3, 4, 5, 6, 7 and 8 had their means

ranging from 4.13 to 4.62 which is above the cut-off point of 2.50 and therefore considered as

being very much required. Also the data showed that the relatedness of the responses of

accounting teachers and accounting lecturers on balance sheet skills required for

entrepreneurship development by senior secondary school students in Anambra State are very

close evidenced in low standard deviation of 0.67 to 1.09.

H01: There is no significant difference in the mean ratings of accounting lecturers and


development by senior secondary school (111) students in Anambra State.

The data for testing this hypothesis was presented in table7.

69

Table7

t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the prime book entry skills required for entrepreneurship development by senior secondary school (111) students in Anambra State.

S/N Items statement 1Χ

S1I

2Χ S1

2 Df t-value P-value Rmk

1. Ability to list the prime books 4.36 .86 4.17 .88 194 1.59 .12 NS

2. Ability to identify credit transactions 4.43 0.90 4.34 .92 194 .55 .58 NS

3. Ability to identify items that are entered into the sales day

book

4.49 0.72 4.40 .84 194 .75 .45 NS

4. Ability to post items into the sales day book 4.52 0..57 4.34 .71 194 1.87 .06 NS

5. Ability to transfer the total sales day book to the appropriate

side of the sales account

4.26 0.90 4.06 .90 194 .1.53 .13 NS

6. Ability to identify items to be entered into the purchases day

book

4.35 0. 90 4.25 .91 194 .74 .46 NS

7. Ability to post items into the purchases day book 4.35 0.72 4.23 .80 194 .78 .44 NS

8. Ability to transfer the total of purchases day book to the

appropriate side of the purchases account

4.19 0.95 4.16 .90 194 .22 .82 NS

9. Ability to identify items of return inward 4.30 0.93 4.16 .91 194 1.04 .30 NS

10. Ability to post items into the return inward day book 4.21 0.91 4.02 .93 194 1.48 .14 NS

11. Ability to transfer return inward total to the appropriate side

of the return inward account

4.12 1.10 3.38 1.07 194 1.80 .07 NS

12. Ability to identify items of return outward 4.21 1.00 4.05 .93 194 1.16 .25 NS

13. Ability to post items into the return outward day book 4.10 0.95 3.87 .96 194 1.66 .10 NS

14. Ability to transfer total of return outward to the appropriate

side of the return outward account

4.07 0.90 3.93 1.00 194 .97 .33 NS

15. Ability to identify items to be posted to the journal proper 4.23 0.94 4.00 1.05 194 1.56 .12 NS

16. Ability to identify accounts to be debited or credited in the

journal proper

4.35 0.94 4.32 .90 194 .86 .40 NS

17. Ability to write narrations of entries in the journal proper 4.26 0.92 4.17 .99 194 .67 .51 NS

Cluster Summary 4.28 0.80 4.11 0.92 1.04 0.31 NS

Key: NS = Not Significant; S= Significant: t cal =calculated value of t-test SPSS; SD1= Standard deviation of Accounting Lecturers; X1= Mean of Accounting Lecturers; SD2= Standard Deviation of Accounting Teachers; X2 = Mean of Accounting teachers; N1= Number of Accounting Lecturers; N2= Number of Accounting teachers; P>= 0.05 Level of Sig.

The Table 7 shows that item 1-17 have their calculated probability (Sig. 2 tailed) values

to be 0.12, 0.58, 0.45, 0.06, 0.13, 0.46, 0.44, 0.82, 0.30, 0.14, 0.07, 0.25, 0.10, 0.33, 0.12, 0.40

and 0.51 respectively and tested at 194 degree of freedom. Since these values are greater than

70

0.05 level of significance, that the null hypothesis was accepted as postulated. Therefore there is

no significant difference in the responses of the accounting lecturers and teachers on the items.

The low standard deviation seen on the mean responses of the accounting lecturers and teachers

which ranges from 0.57 to 0.71 and 0.71 and 1.07 respectively indicated that the opinions of the

respondents on the hypothesis stated on the prime book entry skills are closely related. This

validates the findings of no significant difference on hypothesis one.


accounting teachers on the cash book entry skills required for entrepreneurship


The data for testing this hypothesis two was presented in table8.

Table 8 t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the cash book entry skills required for entrepreneurship development by senior secondary school (111) students in Anambra State.


S1I

2Χ S1


1 Ability to draw up a cash book columns 4.43 0.78 4.50 0.74 194 -.66 .51 NS

2 Ability to identify cash transactions 4.54 0.80 4.59 0.75 194 -.48 .63 NS

3 Ability to identify the debit and credit entries of the cash book 4.57 0.73 4.56 0.76 194 .08 .93 NS

4 Ability to identify credit and debit balances in the cash book 4.40 0.75 4.45 0.80 194 -.37 .71 NS

5 Ability to identify kinds of cash book 4.14 0.95 4.15 0.84 194 -.07 .94 NS

6 Ability to post items into the cash book 4.19 0.95 4.13 1.01 194 .46 .65 NS

7 Ability to make a contra entry in the both debit and credit sides

of the cash book

4.23 1.06 4.21 1.01 194 .08 .94 NS

8 Ability to calculate and deduct cash discounts in the cash book 4.31 0.99 4.29 0.82 194 .12 .91 NS

9 Ability to post and cast items in the cash book correctly 4.24 1.01 4.23 0.97 194 .04 .97 NS

10 Ability to balance the cash book 4.56 0.68 4.51 0.67 194 .52 .61 NS

Cluster Summary 4.36 0.87 4.36 0.84 -0.03 0.78 NS


71


to be0.51, 0.63, 0.93, 0.71, 0.94, 0.65, 0.94, 0.91, 0.97and 0.61 respectively and tested at 194

degree of freedom. Since these values are greater than 0.05 level of significance, that the null

hypothesis was accepted as postulated there is no significant difference in the responses of the

accounting lecturers and teachers on the items. Also low standard deviation range of 0.68 to 1.06

for accounting lecturers and 0.67 to 1.01 for accounting teachers shown in the table showed

correlation in the mean responses of the respondents on hypothesis two. This also validates the

finding on hypothesis two.

H03: There is no significant difference in the mean ratings of accounting lecturers and accounting teachers on the bank reconciliation skills required for entrepreneurship development by senior secondary school (111) students in Anambra State.

The data for testing this hypothesis was presented in table 9.

Table 9

[t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the bank reconciliation skills required for entrepreneurship development by senior secondary school 3 students in Anambra State.


S1I

2Χ S1


1. Ability to identify items that cause discrepancy between cash

book and bank statement

4.52 0.78 4.45 .76 194 .70 .49 NS

2. Ability to adjust the cash book balance 4.45 0.84 4.46 .79 194 .10 .92 NS

3. Ability to identify unpresentedcheques 4.29 0.96 4.18 1.02 194 .75 .46 NS

4. Ability to identify unaccredited cheques 4.42 0.85 4.27 .96 194 1.13 .26 NS

5. Ability to identify errors in the cash book 4.40 0.81 4.37 .91 194 .24 .81 NS

6. Ability to identify errors in the bank statement 4.49 0.75 4.36 .85 194 1.12 .26 NS

7. Ability to prepare the bank reconciliation statement 4.33 0.91 4.32 .92 194 .90 .93 NS

8. Ability to balance the adjusted cash book 4.27 0.91 4.23 .93 194 .31 .75 NS

9. Ability to reconcile the cash book and the bank statement using


4.23 0.96 4.13 1.07 194 .70 .48 NS

10. Ability to write up bank statement and cash book at the same date 4.32 0.87 4.20 1.01 194 .91 .36 NS

11. Ability to identify the items to be added or deducted from the

adjusted cash book

4.44 0.73 4.41 .81 194 .27 .79 NS



72


to be 0.45, 0.92, 0.46, 0.26, 0.81, 0.26, 0.93, 0.75, 0.48, 0.36 and 0.79 respectively and tested at

194 degree of freedom. Since these values are greater than 0.05 level of significance, that the

null hypothesis was accepted as postulated that there is no significant difference in the responses

of the accounting lecturers and teachers on the items. The low standard deviation seen on the

mean responses of accounting lecturers and accounting teachers which ranges from 0.73 to 0.96

and 0.76 to 1.07 respectively indicated that the opinions of the respondents on hypothesis three

are closely related and also validates the findings of the stated hypothesis.


accounting teachers on the ledger skills required for entrepreneurship development by senior

secondary school (111) students in Anambra State.


73

Table 10 t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the ledger skills required for entrepreneurship development by senior secondary school(111) students in Anambra State.


S1I

2Χ S1

2 Df t-value P-value

Rmk

1 Ability to identify personal accounts 4.51 0.69 4.41 .78 194 .948 .34 NS

2 Ability to adjust the cash book balance 4.30 0.89 4.18 .94 194 .90 .37 NS

3 Ability to post transactions into different classes of account correctly

4.44 0.72 4.33 .79 194 1.01 .32 NS

4 Ability to balance each account correctly 4.39 0.90 4.38 .86 194 -.14 .89 NS

5 Ability to transfer the balance of each account to the trial balance

4.27 0.84 4.29 .82 194 -.10 .92 NS

6 Ability to observe the double entry principle in the ledger 4.33 0.78 4.36 .78 194 -.36 .72 NS

7 Ability to draw the trial balance for ledger account 4.31 0.97 4.20 .96 194 -.21 .83 NS

8 Ability to identify the giver and receiver of values in each transactions

4.43 0.97 4.34 .89 194 .81 .42 NS

9 Ability to draw up a trial balance 4.43 0.78 4.36 .89 194 .59 .56 NS

10 Ability to transfer balances from different ledger account into the trial balance

4.27 0.88 4.11 .99 194 1.22 .22 NS

11 Ability to identify errors that affect the trial balance 4.31 0.76 4.09 1.09 194 1.58 .12 NS

12 Ability to identify errors that does not affect the trial balance

4.24 0.93 4.00 1.20 194 1.51 .13 NS

13 Ability to correct errors 4.13 1.05 3.89 1.15 194 1.49 .14 NS

14 Ability to transfer errors not identified to the suspense account

4.23 0.80 4.01 .97 194 1.67 .10 NS

15 Ability to add up the totals of the trial balance 4.23 0.94 4.13 .90 194 .70 .49 NS

16 Ability to identify accounts with debit balances 4.11 1.05 4.11 1.01 194 .00 1.00 NS

17 Ability to identify accounts with credit balances 4.25 0.98 4.13 1.01 194 .87 .39 NS

18 Ability to title the trial balance 4.38 0.82 4.19 1.03 194 1.33 .89 NS



74


to be 0.34, 0.37, 0.32, 0.89, 0.92, 0.72, 0.83, 0.42, 0.56, 0.22, 0.12, 0.13, 0.14, 0.10, 0.49, 1.00,

0.39 and 0.89 respectively and tested at 194 degree freedom. Since these values are greater than

0.05 level of significance, that the null hypothesis was accepted as postulated, that there is no

significant difference in the responses of the accounting lecturers and teachers on the items. The

low standard deviation shown with the range 0.69 to 1.05 and 0.78 to 1.20 on the opinions of

accounting lecturers and accounting teachers respectively indicated correlation in the mean

responses of the respondents on hypothesis four and also supports the findings that there is no

significant difference in the stated hypothesis.

H05: There is no significant difference in the mean ratings of accounting lecturers and accounting teachers on the trading, profit and loss account skills required for entrepreneurship development by senior secondary school (111) students in Anambra State.


Table 11 t-test analysis of the responses of the accounting lecturers and accounting teachers’ on their perception on the trading, profit and loss account skills required for entrepreneurship development by senior secondary school (111) students in Anambra State. S/N Items statement S1

I 2Χ

S12 Df t-value P-

value Rmk

1 Ability to identify items that make up trading account 4.54 0.65 4.54 .60 194 0.13 .90 NS 2 Ability to prepare a trading account to determine cost of goods sold 4.63 0.58 4.62 .63 194 .17 .87 NS

3 Ability to obtain the gross profit or loss in trading account 4.50 0.67 4.53 .66 194 .28 .78 NS 4 Ability to identify expenses associated with profit and loss account 4.50 0.72 4.48 .77 194 .17 .87 NS 5 Ability to identify the business incomes and add them to the gross

profit correctly 4.43 0.87 4.38 .87 194 .36 .72 NS

6 Ability to transfer gross profit from trading account to the profit and loss account

4.37 0.79 4.28 .93 194 .73 .47 NS

7 Ability to add provisions to the sides of profit and loss account correctly

4.46 0.68 4.37 .82 194 .89 .37 NS

8 Ability to obtain the net profit or loss in profit and loss account 4.34 0.70 4.34 .75 194 .06 .96 NS

9 Ability to cast out the items in trading, profit and loss account correctly 4.39 0.73 4.33 .68 194 .62 .54 NS 10 Ability to calculate goods available for sale in the trading account 4.30 0.90 4.34 .90 194 .32 .75 NS 11 Ability to deduct expenses in the profit and loss account 4.50 0.72 4.48 .77 194 .17 .87 NS

Cluster Summary 4 4.45 0.73 4.43 0.76 0.25 0.74 NS Key: NS = Not Significant; S= Significant: t cal =calculated value of t-test SPSS; SD1= Standard deviation of Accounting Lecturers; X1= Mean of Accounting Lecturers; SD2= Standard Deviation of Accounting Teachers; X2 = Mean of Accounting teachers; N1= Number of Accounting Lecturers; N2= Number of Accounting teachers; P>= 0.05 Level of Sig.

75


to be 0.90, 0.87, 0.78, 0.87, 0.72, 0.47, 0.37, 0.96, 0.54, 0.75 and 0.87 respectively and tested at

194 degree of freedom. Since these values are greater than 0.05 level of significance, that the

null hypothesis was accepted as postulated that there is no significant difference in the responses

of the accounting lecturers and teachers on the items. The standard deviation range of 0.58 to

0.90 and 0.60 to 0.93 in respect to accounting lecturers and accounting teachers respectively are

low and indicated the relatedness of the opinions of the respondents on hypothesis five. This also

validates the findings the stated hypothesis five.

H06: There is no significant difference in the mean ratings of accounting lecturers and accounting teachers on the balance sheet skills required for entrepreneurship development by senior secondary school (111) students in Anambra State. The data for testing this hypothesis was presented in table 12.

Table 12

t-test analysis of the responses of the accounting lecturers and accounting teachers on their perception on the balance sheet skills required for entrepreneurship development by senior secondary school (111) students in Anambra State.


S1I

2Χ

S12 Df t-value P-value Rmk

1 Ability to differentiate between assets and liabilities 4.57 0.76 4.65 .72 194 .75 .45 NS

2 Ability to identify different types of assets and liabilities 4.42 0.79 4.36 .81 194 .51 .61 NS

3 Ability to transfer net profit from the profit and loss

account to the balance sheet

4.53 0.63 4.30 .68 194 2.31 .02 S

4 Ability to calculate and deduct depreciations from fixed

assests

4.37 0.83 4.10 .99 194 2.03 .04 S

5 Ability to name the balance sheet appropriately 4.32 0.82 4.28 .92 194 0.35 .73 NS

6 Ability to prepare the balance sheet for internal use and

for publication

4.27 1.00 4.02 1.14 194 1.64 .10 NS

7 Ability to enter the balance sheet items orderly 4.40 0.70 4.12 .92 194 2.41 .02 S

8 Ability to balance up the balance sheet 4.51 0.75 4.33 .94 194 1.45 .15 NS



76

The Table 12 shows that item 1, 2, 5, 6, and 8 have their calculated probability (Sig. 2

tailed) values to be 0.45, 0.61, 0.73, 0.10 and 0.15 respectively and tested at 194 degree of

freedom. Since these values are greater than 0.05 level of significance, the null hypothesis was

accepted as postulated that there is no significant difference in the responses of the accounting

lecturers and teachers on the items. However, items 3, 4, and 7 have their calculated probability

values to be 0.02, 0.04 and 0.02 respectively. With these values being less than 0.05 significance

level indicate that there is significant difference in the responses of accounting lecturers and

accounting teachers on the items. Therefore, the hypothesis of no significant difference for H06

was rejected. The low standard deviation as seen in the table above showed that the opinions of

the respondents on hypothesis six are correlated and also validates the findings.

Findings of the Study

The following findings emerged from the study with respect to the research questions and

hypothesis tested.

1. The prime book entry skills required for entrepreneurship development were perceived as

very much required by senior secondary school leavers. These skills includes: ability to

identify items to be posted to each prime books, ability to post those items identified into

the respective prime books and ability to transfer the totals in the prime books to the

appropriate side of the account.

2. Possessing cash book entry skills so as to be able to identify cash transactions, identify

debit and credit entries of the cash book, post items as well as balance the cash book are

essential skills required for entrepreneurship development by senior secondary school

leavers.

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3. Having the ability to reconcile bank statements and cash books is an essential skill that is

required for entrepreneurship development so as to check fraudulent attitudes between

the entrepreneurs and their customers.

4. Ledger entry skills perceived as very essential skills for entrepreneurship development by

senior secondary school students includes: ability to identify and post transactions into

different classes of account, ability to observe the double entry principle as well as the

ability to identify the giver and receiver of values in every transaction.

5. Having trading, profit and loss account skills have been perceived to be an essential skill

required for entrepreneurship development by senior secondary school students. These

skills includes: ability to prepare trading account to determine cost of goods sold and

goods available for sale, ability to obtain gross profit or loss, ability to obtain net profit or

loss in the profit and loss account and ability to identify and deduct expenses charged to

trading, profit and loss accounts respectively.

6. Possessing balance sheet skills has been perceived as very much required skill for

entrepreneurship development by senior secondary school so as to be able to identify

items of assets and liabilities and ability to prepare a balance sheet for internal use and for

publication.

7. It was found that there was no significant difference in the mean responses of accounting

lecturers and teachers on the prime book entry skills required for entrepreneurship



lecturers and teachers on the cash book entry skills required for entrepreneurship


78


lecturers and teachers on the bank reconciliation skills required for entrepreneurship



lecturers and teachers on the ledger entry skills required for entrepreneurship



lecturers and teachers on the trading, profit and loss account skills required for

entrepreneurship development by senior secondary school (111) students in Anambra

State.


lecturers and accounting teachers on 5 items on the balance sheet skills required for


State.

Discussion of the findings

The findings of the study were organized and discussed according to the research

questions answered and null hypothesis tested.

A. Basic financial accounting skills with regards to prime book entry skill required for

entrepreneurship development.

The data presented in the Table 1 provided answers to research question one. The

findings revealed that senior secondary school leavers (prospective entrepreneurs) requires prime

books entry skills for them to be able to establish, grow and manage their own businesses well

79

for greater development. The essential prime books skills as revealed by the findings of this

study are: ability to identify prime books, post items into the books and ability to transfer totals

of these books to the appropriate side of the account in the ledger. Also, the result of H01 in Table

7 indicated comparison of the respondents (accounting lecturers and accounting teachers) on the

prime book entry skills required for entrepreneurship development by senior secondary school

students (111) in Anambra State tested with t-test statistics at 0.05 level of significant and at 194

degree of freedom. The findings indicated that all the seventeen items of prime book entry skills

were accepted by the respondents as being essential skills required for entrepreneurship

development by senior secondary school leavers. This is based on the result of the calculated

grand mean and p-value of all the items of the cluster which were greater than 2.50 and 0.05

respectively. Therefore, it could be deducted that there is no significant difference in the mean

responses of accounting lecturers and accounting teachers on the prime book entry skills required

for entrepreneurship development by senior secondary school leavers. The implication of these

findings was that it helps to confirm the findings made in research question one. These findings

are in consonant with the findings of Abdulrasheed et al (2012) who identified purchases day

book, cash book and ledger as the most required financial record books that must be kept by

small and medium scale businesses and stated that keeping of these books helps to improve the

accuracy and reliability of the accounting transactions which further provides the input to

financial statement for small enterprises. Possessing these skills introduces the secondary school

leavers to the basic financial books to be kept that will assist in the development of their

businesses even though majority of small and medium scale enterprises in Nigeria do not keep

proper financial re cords of their transactions. This is also the view ofAdemola et al (2012) who

80

discovered that owners of small and medium enterprises in Kogi do not keep records of their

transactions which deters them from determining the growth of their businesses.

B. Basic financial accounting skills required by senior secondary school leavers with

regards to cash book entry skills for entrepreneurship development.

The data presented in Table 2 provided answers to research question two. The findings

revealed that senior secondary school (111) leavers requires cash book entry skills for them to be

able to control cash inflow and outflow of their businesses. Cash is the basic unit needed to keep

businesses running on a continuous basis and is also the ultimate output expected to be realized

in any business. Cash flows in and out of businesses on the daily basis and must be properly

recorded to avoid overstatement or understatement of customers account. The result of H02

formulated on the cash book entry skills required for entrepreneurship development by senior

secondary school leavers is presented in Table 8 also. The calculated grand mean and p-value for

all the ten items of the cluster were greater than 2.50 and 0.05 respectively. Therefore, the null

hypothesis was upheld at 0.05 level of significant. On these items, it was noted that accounting

teachers and accounting lecturers agreed on the cash book skills required for entrepreneurship

development by senior secondary school leavers in Anambra State. The implication of this result

was that it helped to confirm the findings made on research question two. The findings of this

study connotes with the view of Morthi (2001) who noted that introducing a fair system for

recording business cash transactions enable owners of businesses exercise control over inflow

and out flow of funds for greater expansion of their businesses. Furthermore, the findings on the

essentiality of cash book entry skills aligns with the view of Brigham in Ali (2001) who stated

that cash is the oil that lubricates the wheel of any business and use of proper record keeping.

81

C. Basic financial accounting skills required by senior secondary school leavers with

regards to bank reconciliation skills for entrepreneurship development.

The data presented in Table 3 provided answers to research question three. The findings

revealed that ability to reconcile the cash book and bank statement of any business helps the

entrepreneur to guard against fraudulent attitudes that may hinder the growth of any business.

The result of t-test significant used to test H03 on the bank reconciliation skills required for

entrepreneurship development by senior secondary school leavers was presented in Table 9. The

calculated grand mean and p-value of all the eleven items of the cluster had their values greater

than 2.50 and 0.05 respectively. Hence the null hypothesis was accepted not having significant

different between the mean ratings of the two group of respondents (accounting lecturers and

teachers) on the bank reconciliation skills required for entrepreneurship development by senior

secondary school leavers in Anambra State. The implication of this finding is that it helped to

validate the findings on research question three. The findings of this study are supported by

Igben (2009) who stated that entrepreneurs should notify the bank of any loss of document or

dead of an individual to avoid payments to wrong person(s). The bank performs number of

transactions on behalf of its customers without customer’s knowledge, therefore possessing the

skills to identify items that are different in both bank statement and cash books are very essential

of small and medium scale enterprises.

D. Basic financial accounting skills required by senior secondary school leavers with

regards to ledger skills for entrepreneurship development.

The data presented in Table 4 provided answers to research question four. The findings

revealed that ledger entry skills are in important skills for entrepreneurship development by

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senior secondary school leavers. The principle findings indicated that senior secondary school

leavers should possess the ability to identify the giver and receiver of values in each transaction

that is the ability to identify trade debtors and creditors of any business since the transaction of

small and medium scale businesses are mostly on credit basis. The result of a t-test of

significance was used to test the H04 on the ledger scales required for entrepreneurship

development by senior secondary school students in Anambra State was presented in Table 10

and tested with t-test statistics at 0.05 level of significance and 194 degree of freedom. The

findings indicated that al the eighteen items of ledger scales were accepted by the respondent as

being essential skill for entrepreneurship development by senior secondary school leavers. This

is based on the result of the calculated grand mean and p-value of 2.50 and 0.05 respectively.

Therefore, it could be deduced that there is no significance difference between the mean

responses of accounting lecturers and teachers on ledger skills required for entrepreneurship

development by senior secondary school leavers. These findings are in line with view of Vitez

(2010) who stated that accounting skill is understanding of the nature of debit and credit and how

financial information flow through the general ledger. Furthermore, the findings revealed that

entrepreneurship development depends on the ledger skill for it is an intermediate skill needed to

be able to receive entries from subsidiary or prime books and modifies them and send them to

the final accounts. This finding is also supported by the view of Abdulrasheed et al (2012) who

stated that ledger is the ultimate destination of all entries recorded in the subsidiary books and

improves the accuracy and reliability of the accounting transactions which further provides the

input to financial statement for small scale enterprises.

83

E. Basic financial accounting skills required by senior secondary school students with

regards to trading, profit and loss account skill for entrepreneurship development.

The data presented in Table 5 provided answers to research question five. The findings

revealed that trading, profit and loss account skill is an essential skill required by senior

secondary school leavers in determining the development of their businesses. The finding of this

study is that ability to calculate profit or loss is the most essential skill that must be posses by

senior secondary school leavers. The result of H05 formulated on the trading, profit and loss

account skills required for entrepreneurship development by senior secondary school students

was presented in Table 11. The calculated grand mean and p-value for all the eleven items of the

cluster were greater than the t-test of 0.05. Thus the null hypothesis was upheld at 0.05 level of

significant. On these items, it was noted that accounting teachers and accounting lecturers agreed

on the trading, profit and loss account skill required for entrepreneurship development by senior

secondary school leaver in Anambra State. The implication of this result was that it was used to

confirm the findings made in research question five. This findings is supported with the view of

Life tips (2011) who stated that through specialized trainings, specific degree or on-the-job

experience, trading, profit and loss account skills entails the mastering of procedures in

calculating business profits.

F. Basic financial accounting skills required by senior secondary school students with

regards to balance sheet for entrepreneurship development.

The date in Table 6 provided answers to research question six. The finding of this study

revealed that balance sheet skills are very much required by senior secondary school leavers for

entrepreneurship development. The major finding of this study was the ability to identify and

84

calculate assets and liabilities of their businesses. Also, the result of a t-test of same significance

was used to test the H06 on the balance sheet skills required for entrepreneurship development by

secondary school leavers in Anambra State was presented in Table 12. The calculated grand

mean and p-value of items 1, 2, 5, 6 and 8 of the cluster had their values greater than 2.50 and

0.05 respectively, while items 3,4 and 7 had the mean ranges of 0.02,0.04 and 0.02 respectively

which indicated disagreement on items 3, 4 and 7. With these values being less than 0.05 level of

significance indicates that there is significance difference in the mean responses of accounting

lecturers and accounting teachers in the balance sheet items required for entrepreneurship

development by senior secondary school students in Anambra State. These findings are in

agreement with the findings of Abdulrasheed et al (2012) who stated that entrepreneurs should

be able to prepare and interpret financial statement and also be able to keep and maintain records

of receipt and payment (cash book), income and expenditure and a balance sheet for their

businesses.

85

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATIONS

Re- Statement of the Problem

Financial accounting skills would ultimately increase the development of

entrepreneurship among senior secondary school leavers in Anambra State. However, the none

acquisition of financial accounting skills by senior secondary school students which was

evidenced in the increasing number of unemployed secondary school leavers in the state,

inability of the youths to remain in their jobs and quick liquidation and collapse of small scale

businesses soon after establishment. Also, these evidence none achievement of the objectives as

stated in the National Policy on Education (2013) and senior secondary school curriculum of

business studies (2007) which aimed at providing entrepreneurs with technical and vocational

job specific skills for self-reliance and to provide fundamental instruction to help students

assume their economic roles as consumers, workers and citizens and provision for personal use

in future respectively. Hence, the need to determine the financial accounting skills required for

entrepreneurship development by senior secondary school students in Anambra State. To ensure

that right skills are being inculcated in the student while in school to improve entrepreneurship

development in Anambra state, these objectives were pursued to:

1. determine the prime book entry skills required for entrepreneurship development by

senior secondary school (111) students in Anambra state.

2. determine the cash book entry skills required for entrepreneurship development by senior

secondary school (111) students in Anambra state.

3. determine the bank reconciliation skills required for entrepreneurship development by

senior secondary school (111) students in Anambra state.

85

86

4. determine the ledger skills required for entrepreneurship development by senior


5. determine the trading, profit and loss account required for entrepreneurship development

by senior secondary school (111) students in Anambra state.

6. determine balance sheet skills required for entrepreneurship development by senior


Summary of Procedure used

The study adopted a descriptive survey research design. Questionnaire was the instrument

used for data collection for determining the basic financial accounting skills required by

senior secondary school (111) students for entrepreneurship development in Anambra State.

A set of 75 structured questionnaire items was used to gather information from 207

respondents made of 118 accounting teachers and 89 accounting lecturers in public

secondary schools and higher institutions in Anambra State respectively. The questionnaire

was face validated by experts in Business Education Department, Faculty of Vocational

Teacher Education, University of Nigeria Nsukka.

The reliability of the instrument was established using Cronbach Alpha formula for

determining the internal consistency. Reliability result of 0.880 was calculated for the

instrument after its trial test on 14 accounting teachers and 6 accounting lecturers in Enugu

State. The data was collected with the help of two research assistance and analyzed with the

use of SPSS 20 version, using real mean limit and standard deviation to answer six research

questions, while t- test was used to test the six null hypothesis at 0.05 level of significance

and at 194 degree of freedom.

87

Summary of Findings

Based on the data collected and analyzed, the following major findings of the study on basic

financial accounting skills required for entrepreneurship development by senior secondary school

(111) students in Anambra State are:

1. Seventeen skills on prime books entry skills for entrepreneurship development by senior

secondary school (111) students were very much required with the opinions of

accounting lecturers and accounting teachers. This was with the means ranging from 4.10

to 4.44.

2. A total of ten items were considered as very much required cash book skills for

entrepreneurship development by senior secondary school (111) students. They were in

agreement with the opinions of the respondents with means ranging from 4.13 to 4.57.

3. All the eleven items on the bank reconciliation skills were agreed as very important skills

required for entrepreneurship development by senior secondary school (111) students

with the means ranging from 4.18 to 4.48.

4. All the eighteen items of ledger skills were also considered as very much required skills

for entrepreneurship development as agreed by the opinions of the respondents with the

means ranging from 4.10 to 4.45.

5. Eleven items of trading, profit and loss account were considered very much required for

entrepreneurship development by senior secondary school leavers as opinioned by the

accounting lecturers and accounting teachers with means ranging from 4.32 to 4.62.

6. Five out of eight (8) items on the balance sheet skills were considered by the respondents

to be required for entrepreneurship development in Anambra State with their means

ranging from 4.13 to 4.62.

88

7. There was no significant difference in the mean response of accounting lecturers and



8. There was no significant difference in the mean response of accounting teachers and

accounting lecturers on the cash book skills required for entrepreneurship development

by senior secondary school (111) students in Anambra State.

9. There was no significant difference in the mean response of accounting lecturers and

accounting teachers on the bank reconciliation skills required for entrepreneurship

development by senior secondary school leavers.

10. There was no significant difference in the mean response of the accounting teachers and

accounting lecturers on the ledger skills required for entrepreneurship development by

senior secondary school leavers in Anambra State.

11. There was no significant difference in the mean response of the accounting teachers and

accounting lecturers on the trading, profit and loss account skills required for


State.

12. Significant difference existed in the mean response of the accounting lecturers and

accounting teachers on the balance sheet skills required for entrepreneurship development

by senior secondary school (111) students in Anambra State.

Conclusion

The study concludes that the basic financial accounting skills required for

entrepreneurship development by senior secondary school leavers in Anambra State are prime

book entry skills which includes: the ability identify prime books of entry and the items to be

89

recorded in each of them and ability to post transactions into the prime books. Cash books entry

skills are also required, these includes ability to identify cash transactions and ability to identify

the giver and receiver of values in any transaction.

Also the study that bank reconciliation skills required for entrepreneurship development

includes: ability to identify items that causes discrepancies in both cash book and bank statement

and ability to reconcile the both books. Ledger skills include the ability to identify the giver and

receiver of values in any transaction. Another important skill that is required for entrepreneurship

development is the trading, profit and loss account and balance sheet skills which include: ability

to calculate the gross or net profit or loss of any business and ability to prepare balance sheet

statement for internal use and for publication.

Finally, these determined financial accounting skills have great impact in the

development of entrepreneurship in Nigeria. No business will do well without proper keeping of

its financial records which these determined skills will assist the senior secondary school leavers

in Anambra State who intends to operate any business of their , manage and development their

businesses to greater height.

Implications of the Study

The findings of this study will have immense implication to the senior secondary school

students, accounting teachers, existing and potential entrepreneurs, education authorities,

curriculum planners, parents and Nigeria government at large.

This research will provide empirical evidenced on which further research will anchor

especially on entrepreneurship development and financial accounting in Anambra State in

particular and Nigeria at large. Another implication of the findings of this research work is that

the study will reveal to the prospective and existing entrepreneurs the reasons behind business

90

liquidations and retardation for them to guard against them to avoid further occurrence. The

findings of this study will expose major areas of concentration while teaching, planning and

supervising to the accounting teachers, curriculum planners and education authorities

respectively. The findings of this study will also increase the development of small of small and

medium scale enterprises in Anambra State in particular and in Nigeria at large which will in

turn bring economic growth and development, reduce unemployment rate and increase the

general standard of living of the entire Nigerian citizenry.

Recommendations

Based on the findings of this study the following recommendations were made:

1. that financial accounting teacher in Anambra State should lay emphasis on the

determined financial accounting skill while teaching by making sure that these

determined skills are fully covered while planning their lessons.

2. that financial accounting be made compulsory subjects in senior secondary schools in

Nigeria considering the need for economic development.

3. that government should organize seminars and workshops to educate stakeholders and

entrepreneurs on the findings of this study.

Limitation of the Study

This research work had the following limitations:

1. One of the limitations of this study was the challenging task of getting accounting

lecturers and teachers respond to the questionnaire as most of them complained of tight

schedule.

2. Another limitation was high cost of transportation due to hike in the price of petrol

experienced in November via December.

91

3. The study was also limited to senior secondary (111) students.

4. Another limitation was time and cost of extending this study to other states.

Suggestions of Further Studies

1. A study should be conducted on strategies for increasing number of students that offers

financial accounting in senior secondary schools in Anambra State.

2. A study should be conducted on the basic financial accounting skills required for

entrepreneurship development by senior secondary schools in Abia, Imo and Enugu

States in Nigeria.

92

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APPENDIX A

POPULATION DISTRIBUTION TABLE

Number of Accounting Lecturers in Public High Institutions in Anambra State S/n Names of higher institutions Number of accounting lecturers 1. NwaforOrizucollege of education

Nsugbe 17

2. Federal collee of education technical Umunze

7

3. NnamdiAzikiwe university Awka 26 4. Federal polytechnic Oko 27 5. Anambra state university Uli 12 Total 89 Source: H.O.D’s of various institutions July, 2015.

Number of accounting teacher in Government secondary schools in AnambraState S/n Zones offering Financial Accounting Secondary

School Number of Accounting Teachers

1. Aguata zone 11 2. Awka zone 25 3. Nnewi zone 21 4. Ogidi zone 21 5 Onitsha zone 26 6. Otuocha zone 14 Total 118 Source: Anambra state ministry of education Awka July, 2015.

SubTotal207

98

APPENDIX B

Department of Vocational Technical Education, Business Education Unit, University of Nigeria, Nsukka. 3rd June, 2015.

Dear Respondents, Questionnaire on Basic Financial Accounting Skills Required for Entrepreneurship Development by Senior Secondary School Students of Anambra State I am a postgraduate Student of the above named institution, currently carrying out a study

on the topic stated above. You have been identified as one who could provide useful information

needed to successfully conduct the study. I will appreciate it if the questionnaire will be

completed by you and return same to the bearer

You are assured that your responses shall be treated with utmost confidence and will be

used strictly for the intended purpose.

Yours faithfully,

OguoraEuchariaU.

99

SECTION A GENERAL INFORMATION

Instrument: Please tick (√) as appropriate in the box provided An accounting lecturer ( ) Accounting teacher ( ) Instruction: Please indicate the degree of your agreement with the following statement by ticking (√ ) in the appropriate column. Key: Very much Required UMR = (5) Much required MR = (4) Averagely Required AR = (3) Somewhat Required SR = (2) Not Required NR = (1)

100

SECTION B QUETION ONE

What are the prime book entry skills required for entrepreneurship development by senior secondary school students of Anambra State?

S/N ITEM VMR (5)

MR (4)

AR (3)

SR (2)

NR (1)

1. Ability to list the prime books 2. Ability to identify credit transactions 3. Ability to identify items that are entered into the

sales day book

4. Ability to post items into the sales day book 5. Ability to transfer the total of sales day book to the

appropriate side of the sales account

6. Ability to identify items to be entered into the purchases day book

7. Ability to post items into the purchases day book 8. Ability to transfer the total of purchases day book to

the appropriate side of the purchases account

9. Ability to identify items of return inward 10. Ability to post items into the return inward day book 11. Ability to transfer return inward total to the

appropriate side of the return inward account

12. Ability to identify items of return outward 13. Ability to post items into the return outward day

book

14 Ability to transfer total of return outward to the appropriate side of the return outward account

15. Ability to identify items to be posted to the journal proper

16. Ability to identify accounts to be debited or credited in the journal proper

17. Ability to write narrations of entries in the journal proper

101

SECTION C QUESTION TWO

What are the cash book entry skills required for entrepreneurship development by senior secondary school students of Anambra State S/N ITEM VMR

(5) MR (4)

AR (3)

SR (2)

NR (1)

18. Ability to draw up a cash book columns 19. Ability to identify cash transactions 20. Ability to identify the debit and credit entries of the

cash book

21. Ability to identify credit and debit balances in the cash book

22. Ability to identify kinds of cash book 23. Ability to post items into the cash book 24. Ability to make a contra entry in the both debit and

credit sides of the cash book

25. Ability to calculate and deduct cash discounts in the cash book

26. Ability to post and cast items in the cash book correctly

27. Ability to balance the cash book

SECTION D QUESTION THREE

What are the bank reconciliation statement skills required for entrepreneurship development by senior secondary school students of Anambra State? S/N ITEM VMR

(5) MR (4)

R (3)

SR (2)

NR (1)

28. Ability to identify items that cause discrepancy between cash book and bank statement

29. Ability to adjust the cash book balance 30. Ability to identify unpresentedcheques 31. Ability to identify uncreditedcheques 32. Ability to identify errors in the cash book 33. Ability to identify errors in the bank statement 34. Ability to prepare the bank reconciliation statement 35. Ability to balance the adjusted cash book 36. Ability to reconcile the cash book and the bank statement using


37. Ability to write up bank statement and cash book at the same date 38. Ability to identify the items to be added or deducted from the

adjusted cash book

102

SECTION E QUESTION FOUR

What are the ledger skills required for entrepreneurship development by senior secondary school students of Anambra State? S/N ITEM VMR

(5) MR (4)

AR (3)

SR (2)

NR (1)

39. Ability to identify personal accounts 40. Ability to identify impersonal accounts 41. Ability to post transactions into different classes of account

correctly

42. Ability to balance each account correctly 43. Ability to transfer the balance of each account to the trial

balance

45 Ability to observe the double entry principle in the ledger

46 Ability to draw the trial balance for ledger account 47 Ability to identify the giver and the receiver of values in

each transaction

48. Ability to draw up a trial balance 49. Ability to transfer balances from different ledger account

into the trial balance

50. Ability to identify errors that affect the trial balance 51 Ability to identify errors that does not affect the trial

balance

52 Ability to correct errors 53. Ability to transfer errors no identified to the suspense

account

54. Ability to add up the totals of the trial balance 55. Ability to identify accounts with debit balances 56. Ability to identify accounts with credit balances 57. Ability to title the trial balance

103

SECTION F QUESTION FIVE

What are the trading, profit and loss account skills required for entrepreneurship development by senior secondary school students of Anambra State? S/N ITEM VMR

(5) MR (4)

AR (3)

SR (2)

NR (1)

56. Ability to identify items that make up trading account 57. Ability to prepare a trading account to determine cost

of goods sold

58. Ability to obtain the gross profit or loss in trading account

59. Ability to identify expenses associated with profit and loss account

60. Ability to identify the business incomes and add them to the gross profit correctly

61. Ability to transfer gross profit from trading account to the profit and loss account

62. Ability to add provisions to the sides of profit and loss account correctly

63. Ability to obtain the net profit or loss in profit and loss account

64. Ability the cast out the items in trading, profit and loss account correctly

65. Ability to calculate goods available for sale in the trading account

67. Ability to deduct expenses in the profit and loss account

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SECTION G

QUESTION SIX

What are the balance sheet skills required for entrepreneurship development by senior secondary school students of Anambra State?

S/N ITEM VMR (5)

MR (4)

AR (3)

SR (2)

NR (1)

68. Ability to differentiate between assets and liabilities 69. Ability to identify different types of assets and

liabilities

70. Ability to transfer net profit from profit and loss account to the balance sheet

71. Ability to calculate and deduct depreciations from fixed assets

72. Ability to name the balance sheet appropriately 73. Ability to prepare the balance sheet for internal use

and for publication

74. Ability to enter the balance sheet items orderly 75. Ability to balance up the balance sheet

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