MANAGEMENT OF PUBLIC FUNDS IN INDUSTRIES (A CASE STUDY OF LIFE BREWERIES LIMITED ABA)
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For some time now, many developing third world countries especially Nigeria has been suffering a wide variety of problems raging from economic political, social, cultural, religious and a host of other problem to mention but a few. Nigerian government in attempt to solve these problems, have been investing some of the public at her disposal in industries to enhance quick economic growth of the country.
As a result of the current economic recession, many industries have liquidated and gone out of production while some others are yet making it. This research is aimed at finding out the problem of these industries that have survived and the steps being taken by the public fund manager to remain in the market.
Life Breweries Ltd. Onitsha viz-a-viz other industries in the public sector was discovered to be having problems like other of finance, raw material, spare parts, foreign exchange and also mismanagement of available funds by the financial managers of the company have been taking lots of steps to see to their existence in the productive sector applying their financial management skills effectively and efficiently.
1.1 BACKGROUND OF THE STUDY
In the past financial management was concerned with the raising of funds whenever the need arises and much attention was not paid to the uses of the funds so raised. But in recent times there had been a change.
The emphasis shifted from financing to the managerial financial problem from only raising of funds to efficient and effective use of funds.
As a result of this widening in scope of financial managers and others entrusted with the management have equally increased. It is no longer the issue of providing funds but it’s provision in good time for the right length of time and it’s correct use or application.
In light of this, it is necessary to investigate how these financial mangers are achieving this having known that public funds are often times misconceived by some people as no body. Funds and as a result should not be cared for.
The researchers choice of the industry for this study is mainly because of this believe that life bear posses the major feature, of any typical industry financed with the public funds in Nigeria.
These features include the acquisition of funds from investors over time it’s investment, the expectation of returns by the firms on investment over time and the periodical distribution of these return to the investors (share holders) in the form of dividend. In view of these special feature, the researcher believes that it is a good representation of the public establishment in Nigeria and as such suits the purpose of this study. A case study of Nigeria Life Breweries Aba, Abia State will therefore provide a birds eye views of the industries financial by the public fund in the country Nigeria.
1.2 STATEMENTS OF THE PROBLEM
In the light of the current economic problems of Nigeria. Visa-viz. the devastated economy, the financial mangers especially those concerned with the management of public funds invested in industries are faced with a lot of problems. The issue of raising adequate funds as well as the application of the funds so raised is no longer an easy one. These problems ranges from lack of spare parts, high cost of foreign exchange of which result in high cost of production unpredictable and inconsistent Federal Government Policies (Monetary and Fiscal) Campaign for backward integration etc.
All these had been more prominent since the introduction of SAP.
The above problem had made it possible for these financial mangers to make effective use of such tools as financial ratios in analyzing and for casting/budgeting accurately mean while, the managers are expected to see that the companies remain production and hence make profit for the fund owners to achieve these, the companies especially the Life Breweries Industries are now faced with a high rate of compettion.
1.3 OBJECTIVES OF THE STUDY
In view of the background and statement of problem already discussed this work aims at achieving the following objective.
1. To identify the problem and the causes of the already identified problems of funds managers in those industries that have survived there recession in Nigeria.
2. To evaluate the role being played by the management of (Life Breweries Industry) public funds in the light of the current economic problem of the country.
3. To examine and make recommendation on what other possible measures that could be adopted in order to curb these problem or improve on the current state of affairs.
1.4 SIGNIFICANCE OF THE STUDY
The past and present government of this country Nigeria, have been trying in their own various ways to see to the improvement of the economy and the development of these nation but not much significant efforts have been made towards the effective management of the limited resources available to the nation especially in the area of the public sector and hence public funds.
For the purpose of this research, the research made the following assumption.
1. the life breweries is being affected by the present economic situation
2. the fund managers of life breweries are not exercising, prudency in their work
3. The life breweries is a boost to Nigeria economy policy.