European Journal of Accounting, Auditing and Finance Research (EJAAFR)

EA Journals

Local Government

Impact of Internal Control Challenges on Financial Performance of Local Government Councils of Nasarawa State (Published)

This research work examined the impact of internal control challenges on the financial performance of local government councils in Nasarawa State, Nigeria. The study employed a mixed-methods approach, combining qualitative and quantitative research methods. Qualitative data are gathered through interviews and focus group discussions with relevant stakeholders, including council officials, financial managers, auditors, and community representatives. Quantitative data are collected through surveys and analysis of financial reports and performance indicators. A structured close ended questionnaire was administered to 211 staff that forms the sample size. The study used the correlation coefficient to establish the relationship between internal control challenges and financial performance, while the multiple regression analysis was used to test all the hypotheses of the study at 0.05 level of significance. Result of the correlation indicates significant relation between internal Control and financial performance whereas the regression analysis found that internal control challenges have significant positive impact on financial performance of Local Government Councils in Nasarawa State. It concluded therefore that effective accountability and stable financial practices in Local Government Councils can only be achieved through a properly instituted internal control system with free or minimal challenges. It recommended that: functions and responsibilities within the local government councils are clearly defined and separated.


Keywords: Financial Performance, Internal control, Local Government, councils

Model of Measurement Allowance Budget (Budget Slack) To Achieving a Proportionate Managerial Performance in Local Government in Indonesia (Empirical Study On Allowance Budget Level of West JavaProvincial Government) (Published)

The purpose of this study is to examine the effect of budget slack on managerial performance; based on the strong or weak, then the budget slack created measurement model for the achievement of proportional managerial performance. The analysis is based on primary data from 26 respondents that local governments collected through questionnaires, and secondary data from the budget report and its realization in 26 districts / cities in West Java region.  The results showed that the budget slack and significant positive effect on managerial performance and their relationship is at magnitude 66, 8%. Budget slack measurement models can be created although it is still a tentative model for partially tested and has not been validated by the stakeholders or users. Researchers found that budget slack measurement model quantitatively improve managerial performance in the range of 40 % and the qualitative performance can be pursued. Increase in the budget that is not offset by an increase in managerial performance will actually increase the budget slack.

Keywords: Budget slack, Local Government, managerial performance, proportionally, the measurement model

Effects of Tax Policy on the Expenditure of Local Government Councils in Imo State (Published)

The objective of the study is to evaluate the effect of the Nigerian tax policy on the ability of local governments to raise and spend money in discharge of their statutory responsibilities. The investigation was prompted by the fact that local governments seem to be carried away by the euphoria of the periodical statutory allocations from the Federation Account to the extent that they are blinded towards the potential of fiscal operations that would make them less dependent on the statutory allocations. The study therefore re-awakens the senses of local government administrators to the need to exploit more efficiently the opportunities that come with the recent national tax policy. The study is anchored on the Decentralization Theory as postulated by Richard Musgrave (1959) cited in Arowolo (2011). The study adopted a descriptive approach. The secondary data were analysed by means of Ordinary Least Square regression and by employing the Chow Test of structural stability it was established that the tax policy which came into operation in January 2010 has a significant impact on the fiscal operation of local governments in Imo State. Furthermore, the study found that the tax policy had a significant positive effect on the expenditure of local governments, for instance, for Owerri-Municipal Local Government, a unit increase in tax revenue brought about one million naira increase in total expenditure of the local government. It was also found that the tax policy improved the ability of local governments to raise revenue through various forms of taxes. Hence local governments would fare better when they fully avail themselves to the opportunities within the tax policy which make fiscal operations easier and more efficient. The implication of the result is that if local governments do not become enthusiastic in exploiting the benefits of the tax policy, they will remain inefficient in the discharge of their statutory functions. The study therefore recommends among others, that local government authorities should be more proactive in the business of fiscal operation by setting targets on the level of tax revenue to be realized within a particular period and reviewing same periodically.

Keywords: Chow Test., Federation Account, Government Expenditure, Local Government, Tax Policy

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