A STUDY ON THE UTILISATION OF ACCOUNTING SYSTEMS TO ENHANCE THE PERFORMANCE OF NON-PROFIT ORGANISATIONS

ABSTRACT: This study was carried out to examine the  utilization of accounting systems for improving the performance of non-profit organizations using selected nonprofit organizations in Enugu State as case study. Specifically, the study aimed at exploring the importance of accounting system to non-profit organization in Enugu State, identifying the users of accounting information of non-profit organizations in Enugu State and determine accounting measures used by non-profit organizations in Enugu State. The study employed the survey descriptive research design. Questionnaire was used for data collection which was raised against a four Likert scale of Strongly Agree(SA), Agree(A), Strongly Disagree(SD) and Disagree(D). A total of 51 respondents were purposively selected as sample size comprising of staff/volunteers from the selected non profit organizations in the study area. Out of the 51 respondents, 43 responses were validated from the survey. The study adopted the contingency theory. From the responses obtained and analyzed, the findings revealed that the accounting measures used by non profit organizations in Enugu State is not  efficient.  The findings of this study also indicated that the essentials of accounting system cannot be overemphasized but among them include; it keeps records of all financial transactions, it helps in evaluating the performance of the organization, it creates budget and future projections for the organization, it helps in filing financial statements, it facilitates decision-making for managements, it helps in detecting and avoiding frauds and theft in the organization and it helps in managing and monitoring cash flow. Further more, the study disclosed that  the users of accounting information of non-profit organizations are the donors, suppliers, members of the organization, granters, sponsors and the management and the categories of accounting measures used by non-profit organizations in Enugu State include; cash accounting measures, accounts receivable, accounts payable and financial close among others. On the basis of these findings, it was recommended that there is need fir non profit oriented organizations to review their accounting systems (measures) since it has been disclosed that the accounting systems in use in the organizations is not effective. In as much as the financial operations of non profit organizations differs from business organizations, it is therefore NPOs to considered adopting the accrual basis of accounting (since the measurement model of accounting is based on historical cost) in order to reliably measure costs, a fixed asset repair fund system or depreciation system should be established. And in terms of disclosure of accounting information, it revises the balance sheet format, increase cash flow statement information, attach importance to off-balance-sheet information disclosure, improve financial analysis indicators, and attach great importance to financial analysis. The use of fund accounting system or the Cameral Accounting system maybe considered invaluable for some non profit organizations. Lastly, NPOs must maintain proper record keeping in line with international financial reporting standard; proper recruitment procedure must be adhered to, periodic training of accounting personnel on modern day software, annual audit of their financial statements, and the establishment of good accounting and internal control systems to curtail fraud.