CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Robbins and DeCenzo (2005) defined organization as “a systematic arrangement of people brought together to achieve some specific objectives”. Hitt (2008) observes that organization is “the framework of responsibility, authority and duties through which the resources of an organisation are brought together and coordinated for the achievement of set objectives”. As expected organizations strive for survival and continuity on one hand, which are paramount; on the other hand, accounting information is essential and seen as the total package in relation to the quality and quantity of organisational success and succession. Scholars have long stressed the importance of succession planning in ensuring the continuity and growth of an organization/firm (Brockhouse, 2004). Some have even gone to the extent of stating that dealing effectively with the issue of succession planning is the single most lasting gift that one generation can bestow upon the next (Ayres, 1990). Unfortunately, succession planning appears to be left to chance by many business organisation (Leaon-Guerrero, 2003). Some researchers assert th apparent neglect of succession planning to the emotion generated by the process; it forces incumbents to face their mortality and makes other business colleagues contend the need for change (Beckhard and Dyer, 2003, Stern, 2004). Additional complication arises because the Chief Executive Officer Succession process within small business organisations is quite different from that of large firms. This is due, in large part, to the coincidence of personal and business interest in small business organisations (Davis, 2010). For instance, in the large corporations the date at which the Chief Executive Officer is replaced is usually agreed upon in advance and is determined by the Board of Directors. Also, the frequency of succession is greater in large firms because these companies themselves produce large number of successors (Gorden and Rosan, 2001). On the other hand, in typical business organisation, there is unlikely to be any consensus on when succession is going to take place based on the accounting information processes present and methods used in obtaining such. Moreover, the number of potential successors is limited to the level of transparency of accounting information process in such a firm or business organisation. Unfortunately, research studies (Beckhard and Dyer, 2000; Maynad, 1999) have indicated that when owners/managers retire, less than one-third of the small businesses are continued to the second generation, and less than half second generation firms make it with the third generation as a result of poor accounting information processes of such firms( BrahanMiller et al, 2004). Consequently, successful succession of the Chief Executive Officer is a crucial goal for business enterprises. Without the next generations’ leadership and direct management of accounting information, the firm cannot maintain its character, let alone survive.
1.2 STATEMENT OF THE PROBLEM
The poor performance of business organizations in Nigeria has been a massive problem as it has negatively influences the economy by throwing many people out of gainful employment and thus leading to the poor performance of the economy, this is because the private sector has proven to be the highest employer of labour in the country as such poor performance of these business organizations has directly affected the economy of the country. Many reasons have been highlighted as the cause of these poor business growth and succession but notable amongst these problems is the lack of effective accounting information as most firms in Nigeria ignore these accounting information to their peril as it becomes difficult to transfer a business from one hand to the other as a result