CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND
Even though a country may be naturally endowed with diverse kinds of resources, the gestures of such country lies in her ability to manage her resources properly. Public sector, in a nutshell, is the sector that manages the resources of the government in other to ensure effective and efficient allocation of these resources for satisfaction of the citizenry concerned. The sector is used in implementing government policies. It is the tool for accelerating development in the entire economy. For instance, it accounts for approximately two-third of gross national products (GNPs) in Nigeria. Pubic sector includes all government ministries and departments, extra-ministerial department, parastatals agencies, commissions and public enterprises. Being a service-oriented sector, it is usually budget financed. Essentially, funds, in the public sector, refers to the sum of money or other resources segregated for the purpose of carrying out specific activities in accordance with special regulations, restrictions and limitations.
According to Vatter, (1947:3), public sector fund accounting is the demonstration of fiduciary stewardship; to show that resources (funds) have been dealt with in a proper way. The management and control of funds in the public sector revolves around towards: responsibility and accountability. This has to do with the honest application of funds and in compliance with proper procedures, ensuring that these funds are spent on properly approved items and within the budgeted level.Inspite of its paramount importance in the economy, this complex sector has failed to live up to the expectations of bringing the policies and programmes of the government fruition. Cases of financial indiscipline like embezzlement of public funds by public office holders are very rampant nowadays. Depletion of public pulse is no longer a new scenario. Most public office holders venture into this sector and come out unprecedently rich.
Astonishing, is the way these undesirable elements embezzle these funds and go scoot free. That Nigeria is known as the third most corrupt nation in the work is not an overstatement. This is largely as a result of financial improperly that is ravaging the public sector. When it comes to public funds, people seems to put aside their moral values. Financial integrity is hardly seen in the public sector. Worst still, is the effrontery being exhibited by these perpetrators even when caught red-handed. The president, Obasanjo, in decrying the high incidence of financial impropriety, said in the daily guardian newspaper on March 25, 2005 that “it is only in Nigeria that you will catch a thief and he takes you to court”. Unfinished projects, non-payment of salaries and pension, and so on, were as a result of misappropriation of public funds in the public sector. No single day will pass without a report on misappropriation of funds in the public sector. This entails the diversion or misuse of funds earmarked for specified project or programme for another unconstitutional selfish purpose.
The magnitude is unbearable. One may rightly ask “is the financial statute vis-à-vis public sector not explicit on the way and manner these funds should be utilized? Or is it a resolution among pubic accounting officers to tow the part of financial in discipline? Financial profligacy is another phenomenon that is wrecking serious havoc in the public sector. There is an accentuated, unbridled and unnecessary squandering of funds in the public sector. About ninety five percent of Nigerians see the public funds as a “NATIONAL CAKE” that fall from heaven. This attitudinal imbalance had led many of these public officer holder to be improvident.