ACCOUNTING INFORMATION

AS AN AID TO MANAGEMENT
DECISION MAKING
(A CASE STUDY OF NICON INSURANCE LTD)

BY

SULEIMAN RAFIAT
ND/15/ACC/FT/1135
BEING A RESEARCH PROJECT SUBMITTED TO
DEPARTMENT OF ACCOUNTANCY, INSTITUTE OF
FINANCE AND MANAGEMENT STUDIES, KWARA STATE
POLYTECHNIC, ILORIN

IN PARTIAL FULFILMENT OF THE REQUIREMENT

FOR THE AWARD OF NATIONAL DIPLOMA (ND)
IN ACCOUNTANCY
JULY, 2017

i
 CERTIFICATION

This project has been read and approved by the

undersigned on behalf of the Department of Accountancy,
Institute of Finance and Management Studies as meeting
the requirements for the award of National Diploma (ND) in
Accountancy.

……………………………. …………………….
MR. ABDULAZEEZ, Y.O. DATE
(Project Supervisor)

………………………………… ….…………………
MR. SAAD TUNDE DATE
(Project Coordinator)

………………………………… ……………………
MR. MOHAMMED, K.A.G DATE
(Head of Department)

………………………………… ……………………
MR. ALIU ISMAILA DAUDU DATE
(External Examiner)

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 TABLE OF CONTENTS
Title page
Certification
Dedication
Acknowledgement
Table of contents
CHAPTER ONE
1.0 Introduction
1.1 Background of the study
1.2 Statement of problem
1.3 Objectives of the study
1.4 Research Questions
1.5 Research Hypothesis
1.6 Significance of the study
1.7 Scope of the study
1.8 Plan of the study
1.9 Definition of terms
CHAPTER TWO: LITERATURE REVIEW
2.1 Historical Background of Accounting
2.2 Review of relevance related literature
2.3 Concept of Accounting in the NICON Insurance
Company

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CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Brief history of NICON Insurance Company
3.2 Research Methodology
3.3 Research Design
3.4 Source of Data
3.5 Data Collection Instrument
3.6 Method of Data Analysis
3.7 Limitation of the study
CHAPTER FOUR: DATA PRESENTATION AND
ANALYSIS
4.1 Data Presentation and Analysis of findings
4.2 Efficiency of NICON Insurance Company Ltd
4.3 Classes of Accounting in NICON Insurance
Company
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 Summary
5.2 Conclusion
5.3 Recommendations
References

iv
 CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Efficiency of every business enterprises will heavily
depend on accounting information which is very vital to
business units in our society. Therefore, the primary
purpose of accounting is to provide information to it
users, primarily on financial in nature about the
economic entities that intend to be useful in making
economic decision. Hence financial or accounting
information has been fulfilling; this function to the general
public.
Accounting is concerned with the recording, analysis,
and forecasting of income and wealth of business and
other entities.
The primary aim of managerial accounting is supply
of information for internal decision making. The objection
of accounting information system is to enable decision
maker in an attempt to optimize the allocation of resources
which they control and assess the actual result of their
decision against the forecast result.
In business enterprises, accounting used as a basis
of the determining activities i.e accounting is all the

1
 activities of the business and as a control these activities
e.g on the aspect of selling purchasing and production.
These data “accounting information” are used to predict
the future events whether be it “profit” or “loss”.
The management of every business must keep
foremost limits thinking of two primary objectives. The first
objective is to obtain or earn profit. The second is to keep
the business of insolvency. Must enterprises close down
due to inadequate fund to settle the debts.
To avoid this situation of insolvency proper
accounting information must be kept which will guide the
governing body of company on it decision making.
1.2 STATEMENT OF THE PROBLEM
In the process of this research some of the problems
confronting the management of the NICON INSURANCE
COMPANY as been made known.
These problems includes:
 Lack of adequate supply of daily return from the
sectional branches of the company and inadequate record
keeping for future references.
 Crediting life fund into general business account
operated by the company which also provides inadequate
information for accounting system.

2
 Storage facilities is a problem been faced by the
company and timeless of information. Accruement of these
problems faced by the management thereby adequate
information as regard to accounting aspect could not aid
management decision making in the reduce time.
 The reconciliation of their account with bank
statement is considered late. Reconciliation is usually
carried out on monthly basis and where there is delay by
the bank, accounting information required at the period
will fall short hence problem arises.
1.3 AIMS AND OBJECTIVES OF THE STUDY
The objective of this study is to bring out how
accounting information is useful to management as regard
to decision making. A lot of people in business seems not to
know the importance of the usefulness of accounting
information in decision making thus they often fails in their
business activities. However, this could even be justify
about a salary earner who often found himself in poverty as
a result of not planning or taking decision of how to spend
every “kobo” in a widely manner which resulted to as
accounting information, before he could apportion certain
amount through accounting information.
Research has been carried out to find out the main

3
objective of this project which to provide broad information
that rule the affairs of the company.
At this juncture, emphasis will be laid on the
interpretation of accounting figures rather than the
procedure of data accumulation and statement preparation.
It must be mentioned that any activity without decision
making is deed and for survival of any management
decision making is paramount.
It will also certain in NICON INSURANCE COMPANY to
view the credibility and efficiency provided by accounting
information for the Management of resources, the benefits,
limitations and suggestions on how to improve this through
the use of accounting information.

1.4 RESEARCH QUESTIONS

1. Does Accounting Information have effect on the
management’s decision making?
2. Can Accounting Information influence the
development of an organization?
3. Does adequate and effective accounting information
help reducing fraud in an organization?

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1.5 RESEARCH HYPOTHESIS
Ho: Accounting Information has no effect on the
management decision making in an organization
Hi: Accounting Information has effect on the
management decision making in an organization
1.6 SIGNIFICANCE OF THE STUDY
Accounting information is of a paramount importance
in any organization or business that wants to make profit.
Without accounting information, the business cannot carry
on accounting information also influences the decisions of
many organization. For the purpose of profitability and
survival any management decision must be base on
accounting information.
1.7 SCOPE AND LIMITATION OF THE STUDY
The purpose of this research work is the find out how
accounting information serve as a aid to management
decision making in the NICON Insurance Company. Lagos
However, this project covers the aim, objective, concept of
accounting, use and users of the accounting information.
Then how it aid management in decision making, details of
accounting information for managerial decision making
shall be discussed.

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1.8 PLAN OF THE STUDY
Chapter one, this chapter consists of the
introduction and other sub-topics which are statement
of problems, objectives of the study, scope of the study
and also definition of terms.
Chapter two consist of literature review, historical
background of accounting, concept of accounting in
NICON Insurance Company, users and uses of
accounting information, management decision making
and accounting information and decision making.
Chapter three has the following sub-topics, brief
history of NICON INSURANCE COMPANY, Research
design, source of data and research methodology.
Chapter four consists of presentation and data
analysis, efficiency of NICON INSURANCE COMPANY
LTD and closes of account in NICON INSURANCE
COMPANY.
Chapter five consists of summary, conclusion,
recommendations and bibliography.
1.9 DEFINITION OF TERMS
In this part of the study here would need to define
some concept as applied to the study.
Bank Statement: This is a record of all

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transactions made by a customer of a bank within a
particular period of time.
Insolvency: This is also known as bankruptcy,
it is the act of not having enough fund to pay your
debts.
Financial Statement: Is a written
comprehensive details of all funds account, flow
statement, value added statement and statement of
affairs for a given period of time usually prepared at
the end of each accounting year.
Middlemen: these are agents between producer
and buyers in terms of buying and selling.
Product: This can be defined as all physical
features and psychological satisfaction received by a
customer.
Distribution: This is the process of business
activities that direct the flow of goods and services
from the producer to the final consumer.

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 CHAPTER TWO
LITERTATURE REVIEW
2.1 HISTORICAL BACKGROUND OF ACCOUNTING
The starting point of accounting can be linked to the
merchants in the Babylonian and Assyrian Civilization,
about 4000 years B.C. The modus operandi for keeping
records then was to make marks on the wall or stone or
papyrus or wax tablets. The method of keeping financial
records was highly primitive.
Inventories tax assessment wage lists, and account as
old as 4500 B.C have also been found and there are plenty
of Egyptians, Greek, Roman early European and Medieval
accounting records in existence when the need for
accounting brought about the development of writing the
ancients kings and rulers controlled most of the wealth
and employed scribes, who are brained in writing and
record keeping, the gradual development of double entry is
well illustrated by the record of Francis Codosaccord Dain,
a Tuscan merchant Banker, many whose record around
1335-1410 are preserved in parts form its inception until
the Fourteenth Century.
The history of accounting is not complete without
mentioning the name of an ITALIAN FRANCISCO MONK

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and Mathematician LUCCA PACIOLO who taught in
Universities at Milan, Pavia, Florence and friend and
contemporary of Leonards da vinci, the crucial event in
accounting was the introduction of double entry book
system. In his famous treatise Summa De. Arithmetical
proportion et proportionality in 1914 in Venice, reverend
father Lucca Paciolo described the double entry system by
giving insight into the reasoning behind accounting record.
He postulated that all entries must have double entry one a
debtor and one a creditor. Even though during this period,
the records were prepared to show statement for the
business rather than the owner, but the yearly preparation
was still lacking.
After Paciolo, a Ductchman advocated the profit and
loss account at yearly interval. The level of civilization and
technological advancement helped in the development of
modern methods of accounting.
During the industrial revolution, there need for
sophisticated accounting methods. Different professional
bodies were formed e.g. ICA Scotland in 1854, ICA England
and Wales in 1880 and Association of Public accountants
in USA in 1887, with the development of new methods,
ownership was separated from Management. Since the

9
discovery of the double entry principles, there has been
tremendous development in accounting theories and
methods.
In Nigeria, record keeping has antecedents in the
ancient Kingdom and empire and prominent then was the
periodic contributions which were recorded on the wall.
But the granting of royal character to royal Niger company
was the turning point in record keeping. The governing
accounting principles in Nigeria was almost the same as
the ones in Britain.
In 1965, the Institute of Chartered Accountant of
Nigeria was established and afflicted with the professional
Institutes in Britain and USA. Many Nigerian came back as
professional accountants and become members. The
Institute was charged with the responsibilities of regulating
accounting procedures and practice in Nigeria. In 1982,
Nigeria Accounting Standard Board was born to set
standard to guide accounting operations.

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2.2 REVIEW OF RELEVANCE OF RELATED
LITERATURE
Decision making which is essence of management is a
reflection of responsibility in the case of business
organization and constitutes the guarantee of quality
distinguishing the work of the top officer of management
form the grassroots.
In the universal would empire, there are some two
hundred people who take on themselves the decision
which make or mar the success of business as a whole.
Like in the theory of Haimum and William G. Scot,
management is said to be a social and technical process
that utilize the resources, influence human action and
facilitate change in order to accomplish an organization
goal which it is generally believed that "management is
the co-ordination of all resources, through the process of
planning (core of action when banking decision), organizing
directing and controlling in order to attain stated
objectives" with all these notion and believed, the manager
today operating in a very competitive and turbulent
environment, he consequently needs management
information to help guide the decision making process.
The information must be relevant to any particular

11
circumstances which is operating at the time of the
decision making process. otherwise the information can
mislead the manager and he can make -a rang decision on
the information honestly supplied.
2.3 CONCEPT OF ACCOUNTING IN THE NICON
INSURANCE COMPANY
The NICON Insurance company like any other
public liability company has the mind of financial
accounting, to seek objectivity and of it must have rules or
principle which lay down the way in which the activities of
the business are recorded.
Therefore accounting as a course on its own is not a
natural science however, it is govern by a number of
principles, rules which are known as concept and
convention.
However, accounting principles are man made so they
are just developing. It does not follow that you will
necessarily agree with the principles they are often
attacked by accounts and other are constantly under going
changes as better method of accounting are fund.
Accounting as a profession has its principle sub divided
into two categories.
1. Acquainting concept and

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 2. Accounting conventions
Hence, the detail of these accounting principle as it related,
to the NICON Insurance company.
1. Accounting Concept: It has become a popular saying in
the olden days that accounting in the language of
business which is so and to make language convey the
same meaning to all people. However, accountants have
the conclusion as some of the basis principles or concept
which guide the daily transaction of the business.
2. The cost concept: Any business enterprises without
tangible fixed asset or comment will not be able to as
such to survival and in together the objectives be achieved
all transaction must be entered in the book at their original
cost in the basis for accessing the future usage not
recorded at their releasable value because these value keep
in changing with changes in price time to time.
3. Accrual Matching Concept: This concept states that
revenue and expenses are recognized and included in the
profit and loss account as they are accrued not as they are
paid or received.
It is necessarily correct that cash paid to customer in
form of which is received as premium during a particular
period of time represent the income and expenditure for

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 that duration in order to obtain information. It is essential
that all transaction are accounted for.
4. The business entity concept: Every Public liability company
are due to be artificial body duly to sue and be sued since
it is a legal separate entity from it member the concept
hold that every economic units is separate from it owner. It
shows that the business own it assets in the case of
Solomon Vs Solomon when a business is said to be
different from tis owners. However. the accounting
records are therefore limited to the firm and do not
extend to the personal of the proprietors. In a situation
where b, the concept is not apprehended to the affair of
such business will be mixed up with the private affairs of
the proprietor and the true, picture of will be made open.
5. Money Measurement concept: Accounting records only
those transaction which are recorded in terms of money
measurement although there is qualities record been kept.
Therefore, money serve as the only practical unit of
measurement through which employee, employers or an
individuals in general can achieve homogeneity of financial
data through accounting records.
6. 7. The duel aspect concept: in any financial
transaction it involves a two fold aspect of

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 1. The yielding of a benefit and
The giving of that benefit
7. The going concern concept: the company Decree
1990 section 37 says a limited liabilih company is
endowed with perpetual succession, that means changes
in member or the death or bankrupt of members would not
affects existences.
ACCOUNTING CONVENTION:
Convention concept cannot implies customs and
tradition and these serves as a wide to the preparation of
accounting statement. They are of three types which are
generally accepted e.g consistence. materiality and
conservation.
1. CONSISTENCE: Since most business are going
concern concept which means the business have perpetual
succession. therefore accounting rules, practices and
conventions should continually be in operation or been
observed and applied to the accounting system of the
enterprises, the means the accounting year should
however, does not absolutely eliminate changes but is a
change occurred, it effect should be shown clear and stated
in the financial statement. In addition as a result or the
accounting year changing from time, different year of

15
financial statement will be comparable and this only when
accounting principle and roles are completely and
continuously adhered to year e.g the method could be
used which every one is convenient.
2. CONSERVATION: This is a conversation of caution
when preparing the financial statements. The knowledge of
this convention is to anticipate that there is no profit from
the year and provide for all losses, this because the
accountant when making a choice of given a figure for
particular transaction, he will understand rather than over
standing profit for example closing stock is valued at
original cost or market price, which over is lower, it
however, happened that the market price is higher than
the cost price, the closing stock will be valued at cost
which is lower in the account rather than market price.
3. MATERIALITY: Accounting does not serve a useful
purpose if he efforts of recording of a transaction in a
certain way is not worth. The purchase of a staples for
instance would be charged as an expenses in the period it
was brought because it is not a material even though it
may infect last for some years.
A typewriter on the other hand would be a material
item. There is no law that lays down what these should be

16
decision as to what is material and what is not
dependent upon judgment. It can been that size and
type of firm will affect the decision as to which item are
materials.
MANAGERIAL DECISION MAKING
Decision, by definition relates to the future, involved
judgments as to the result of choice among attentive
courses of action a man with N100 at this disposal will
need to deride , whether to expedition material things or
saving or saving it. Which either one is termed as his
decision.
When a decision situation arises, the good
manager/Boss knows what kind of information he need to
guide him in applying his judgments to the problem.

STEPS IN DECISION MAKING

1. Appraisal in results
2. implementation of best solution discovered
3. selection of relevant facts
4. determination of relevant facts
5. determining problems of specific objectives as
desired by Management
6. understanding the scope of validity of factual

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knowledge
ACCOUNTING INFORMATION AND DECISION MAKING
Accounting information has brought about bending of
the identities of management and accounting into a unified
process for certain importance aspects of the management.
The two key elements in the success of enterprises are
accounting control and management capacity. These two
determinants of success are fully sanctioned by
Accounting information through the harmonizing for the
purpose of management therefore it has acted as catalytic
agent in the process of economic development requiring on
efficiency use of limited material resources.
Moreover, Accounting information has led to a clear
slup from more recording transactions to their analytical
and interpretative aspect as well as a change of
perspective with regards to the objective of accounting
which now help the management to secure better result.
It has open new lines of through on work measurement
has indicated the advantages still to be obtained from
mere previous forms of control.

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 CHAPTER THREE
3.0 RESEARCH METHODOLOGY
This chapter is concerned with the methodology used
for this project
3.1 BRIEF HISTORY OF THE CASE STUDY (NICON
INSURANCE COMPANY)
The setting up of "The NICON Insurance company
limited" was approved by the Lagos State Executive council
in July, 1970 and was incorporated, 1970 the company
was to transact insurance business within and outside
Lagos state as well as to raise enough funds to finance
some vital economic project embarked upon the state
government besides the company was expected to profit
oriented and provide employment opportunities.
3.2 RESEARCH METHODOLOGY
The research methodology is the process or system
taken by the research to sought out things, how relevant
information could be collected on two vital subject of the
course of study which listed below;
i. The accounting information, and
ii. Managerial decision making
In addition audit management account and technical
section involved in the act of managerial decision making

19
while the account section also centrally gives information.
The process used in collecting the data is through
interview in gathering the information from the top officer
of the company. Personal observations is another method
used by going through some accounting records collected.
3.3 RESEARCH DESIGN
Under this heading "research design" the researcher
mention some vital decision taken in carry out this research
work starting from data usage, data collection method
research instruments. In the process of carrying out this
work, a lot of decisions were taken in other to dislodge
some dreadful problem from their position.
3.4 SOURCES OF DATA
The two sources of data used in carrying out this research
work is primary data and secondary data.
i. Primary Data: these are the data that are collected
from were derived mainly or purpose from the
questionnaire and personal interview with the aim to find
out the view of accounting information as an aid to
management decision making.
ii. Secondary Data: These are the information that has
been used by other people in one way or the other.
Therefore, the secondary data for the research work, was

20
got from the record of the past present or experience
written down which is useful for another thing entirely
without originally design for it. The research work or
sources of the secondary data was got from the textbooks
and journal on risk management, application and accounts
in relation to business efficiency of human and material
resources were consulted.
3.5 DATA COLLECTION INSTRUMENTS
These are the instrument used by the researcher to
obtained data in an effort to get accurate and up to data
information for the study.
There are three basic method of gathering data, which are;
i. Questionnaire
ii. Observation
iii. Interview

3.6 METHOD FOR DATA ANALYSIS

Because of the nature of the research which is an
exploratory one, the method of analysis was descriptive and
analytical.
The response to the questionnaire is present and
analyzed with the use of simple questions attempt was
also made at relating data with hypothesis. In order to

21
explore the relationship that exists between the variables.
3.7 LIMITATION OF THE STUDY
1. The project is limited to the class of accounting
information in the company and the general view of
accounting information towards decision making, there is an
acute short coming source of finance to execute the project
successfully.
2. Tribalism contribute to the limitation of this project
during the research as a result of tribe differences questions
were asked of were hindered the release of some reliable
information.
3. There are more profitable information which could have
helped during the course of research but were not release as
the company kept it secrete because they do not want the
general public to know their true stage of business either
because of tax purpose or anything else could have hindered
them.

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 CHAPTER FOUR
PRESENTATION AND ANALYSIS OF DATA
4.1 DATA PRESENTATION AND ANALYSIS OF FINDINGS
Accounting information as an aid to management
decision making in any organization is to provide
information and the management in obtaining and adequate
and useful information that will help it in it day to decision
making. In the similar way, in NICON Insurance Company
Limited, the accounting information as an aid to
managerial decision making lied majority in accounting
department, administrative and audit departments. In
order not to create doubts in our mind as to the course of
the study various data has been collected for the
relegation of how important this department. The
treatment of data and information gathered are therefore,
discuss below:
In accounting department or section, research has
been that this department is one of the live of any
business organization without which business could not
function well as to the expectation reviewed by the
directors of the company.
In the research design test we could find out the
every steps was accounting information as decision making

23
and could not be effectively use In the sole proprietorship
hence knowledge of accounting is not performing his
function in the trade, or profession the sense that it goes
into losses every time. But from the point value usefulness
of accounting information function well in the private and
public companies. This department aids the management
to make decisions. In order to determine the cost or
expense eyes imbursement of various branches of the
company, the management department decides this.
It is the accounting section that is going to evaluate
take the statistical data of how indemnity is to be done to
individual customer entitled to claim it the insurance
agent are also responsible to the account section. There,
commission are prepared and often paid by the department
via cheque and 11 companies decision gain to materialization
is always with the concept of the chief accountants.
The administrative sector is mainly responsible to
the staff to see to their efficiency, this section also involves in
the technical aspect of the business i.e any claim lodged
would have to be technically viewed by the officer in charge
and success of the claim will depend on the officers data.
This section is also responsibilities for any external
relations and the general coordination of the business.

24
 Audit department: The general role played by an
internal audit system is also applicant in the NICON
Insurance company, chief work to set control on the general
account standard which always make the work of the
statutory auditory easier and to further revealing the truth
and fair financial position of the company.
4.2 EFFICIENCY OF NICON INSURANCE COMPANY
LIMITED
The efficiency of NICON Insurance company limited
emerged greatly as a result of its quality business, "the
business that payee is the business that study" it a very
popular insurance cliche. Quality business in this respect
can be described as the type of business from which sales
man derives the maximum possible income. It thus gives
the for example the income which it has been projected
over the long time to produce.
The second international finance award granted by
the Traders lenders club and Editorial office in co-
operation with their journals mercade mundial, African
Trade review and the East Trade of 1990 was won by the
NICON Insurance company limited.
The international financial Award has been created
precisely to recognized prestige and acknowledge

25
international firm of this sector considering their image
and quality of the main target of their activity.
In view of the company decree 1968 demands of each
company to meet certain statutory requirement the central
bank of Nigeria request all financial institution to file
certain quarterly returns of the company which must not
be latter than thirty days after the ends of each quarters,
the NICON Insurance company limited management are
up to data which hare been pan of economic development
in Nigeria.
The foundation lay ceremony of NICON Insurance
company limited Head of office complex in Lagos on
Monday, April 17th 1989 all believes to ensure that lands
are on deck to compliment the effort of both the Board of
Directors and the management.

4.3 CLASSES OF ACCOUNTS IN NICOME INSURANCE

COMPANY LIMITED
NICON Insurance company limited maintained
various section of accounts through which revenue and
costs are being accounted for however, the account
department is further sub-divided into five basis section
viz, final accounts fund accounts. credit control, technical

26
 accounts, and the zonal and including the Head office) with
each zone comprising of a member of branches under it.
The function of each section are listed;
1. FINAL ACCOUNTS: A form of data bank where the
summarize of all the zonal activities including the credit
control and technical accounts are collated. As the name
can notes here is the section where the final accounts are
prepared and services as the bank for all sorts of
management information. The section obtains its data
form all the other sections of the accounts department
without any exception.
2. CREDIT CONTROL: it serves as the clearance house of the
company with it's various agents and broker debtor. The
individual accoun4s are kept and monitored with a view to
boast the liquidity position of the company by pursuing
and collection of debts owned the company.
3. TECHNICAL ACCOUNTS: This perform the same function
as the credit control but limit its activities to insurance
company's debtors and creditors only. Technical accounts
depend solely on information received from the
Reinsurance Department and the cleaning departments.
4. THE FUNDS ACCOUNTS: The fund=accounts concerns
itself with the inflow, and outflows of fund only,

27
 consequently, all request for payment are made to this
section by other section for processing monies are also
received for,*ad banked by this section in line with the
company laid down policy of banking each days sales
proceeds on the second working day. This section that
also take care of the staffers monthly stipends.
5. ZONAL ACCOUNTS: zonal accounts (including Head of
Offices Accounts) records and collated premium income
as well as process and record expenditure in respect of the
branches are also undertaken.
Having know that respective classes of account
transacted within the NICON Insurance company, I will
also go into the source of relevance and expenditure
(accounting for revenue and accounting for expenditure)
through which these classes of accounts are being
furnishes up.
Accounting for revenue, therefore, I will look into
details of the major source of revenue which are viz
i. Direct premium from clients
ii. Premium from reinsurance arrangement including
commission receivable
iii. Claims receivable
iv. Investment income and other sundry incomes.

28
i. DIRECT PREMIUM: When an insured is charged a premium a
notice to pay the amount of the premium is served on him.
This is called a debt note (used in respect of non-life business
only). A debits note is a notification that a client is owning
use the amount so stated on the DEBIT NOTE and it is the
parameter used in the accounts for measuring the premium
income accruing to the company.
You will note that where a client has an agent broker,
such agent or broker is entitle to a certain percentage of the
premium as commission. It is however enjoined that the
client pay cash or cheque for his premium a receipt is
issued for the amount is paid, but no commission will be paid
to any agent or broker until cheque are cleared in the banks.
Where a client notifies the company of his intension
to discontinue with a policy or where there is a mistake from
the uproar writing department on any previous debt notes,
credit note when it is issued to amend a debit note.
ii. PREMIUM FROM REINSURANCE: As a risk bearer company
insurance company include in sharing risks with other sister
insurance companies through reinsurance arrangement,
debit notes are raised by the reinsurance companies that
code insurance company that will code business to. These
are called reinsurance in wars receivable by the credit

29
company and payable by the code company.
iii. CLAIM RECEIVED: Other insurance companies and
normally given some shares the premium income on any
policy (at least 20% to Nigeria Reinsurance corporation) so
also are the losses shared company them. Consequently for
any loss so incurred by the company, it is entitled to full
recovery to the extent of the percentage premium it has code
to other insurance company. To acknowledge the above
transactions, debit notes or credit notes are raised by the
claim department as the case may be and the information
passed to the accounts department for keeping.
iv. INVESTMENT INCOME: as a profit making venture, the
NICON Insurance company limited is always scouting for
avenues to maximize its profit. To this end the refuse to
allow their cash to lie idle in the bank since the opportunity
cost of such action is detrimental to the attainment of their
corporate goal. Consequently, they as much as possible to
invest surplus decree vis-a-vis investment such returns
from the basis of their investment income in these are
adequately account for their books.
ACCOUNTING FOR EXPENDITURE: Expenses of the
company are either under-writing direct expenses such
claims, commission etc or administrative expenses,

30
electricity bill e.t.c. In all cases, expenditure must be
properly authorized before its incurrence or settlement by the
account department when a expenses has been thus
authorized. The document « ill be passed to the chief
accountant for settlement. The zonal accounts concerned or
Head of office Accounts as they may raise a payment voucher
to the internal audit department for vetting. Income cases
audit department do some sample market survey to ascertain
the reliability of prices quoted on payment bills. After the
audit department must-have satisfied itself with the
payment procedure, the document will be raised. Two
signatory and the general Management or company secretary
have to counter sign the cheque before it could be honoured
by the bank.
There is a pretty cashier under the direct supervision
of the funds account who keeps a petty cash float where
petty basis depending on the turnover of the expenses.
Branches manager also keep petty cash floats but are not
empowered as bank signatories to the various bank accounts
in their respective domain. Hence all branches request for
cash payment are made to the head officer for executive.
Records of all income and expenditure are kept in the
respective arms of the account department and appropriate

31
preparation is done for reserve as provided by the insurance
decree to ascertain profit or loss of the company at the close
of the financial year.

32
 CHAPTER FIVE
5.0 SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 SUMMARY
In the previous chapter a lot of research work has
been done and the finding have been presented and
analyzed. Therefore, it is important to give the summary,
conclusion of the whole findings and make useful
recommendation that relevant to the research topic.
In the context of the topic, several aspect were
discussed that concerned accounting information as an
aid to management decision making, the definition of
accounting information. The study of accounting
information as an aid to management decision making
has revealed the various ways by which accounting
influenced the various management decision in NICON
Insurance company Lagos.
The project examined the various inter-woven
relationship of existing literature and journals. In the area
of investigation, personal interview was carried out through
direct interview in the top officer of the company by the
investigation to the company.
The result of this study has shown that there
existing two department in insurance company. The

33
account and the management department, but their
service are interwoven and carried out hand in hand for
effective functioning. Much the company as a result of the
services rendered by each of them.
5.2 CONCLUSION
Accounting information are performing a lot duties in
an organization and without and accountant in an
organization can not function well as expected by the
management, hence will lead to winding up of the
business, trade or violation.
Hence will reduce the importance of accounting
information as an aid to management decision making.
In conclusion, this project, it is very necessary to
bring to light since the study has revealed different ways
about accounting information and decision making that in
organization, aiming at profitability or survival should
doing to accounting information. It is often and that how
would they hear when there is not leader and how would
they know if there of information and management with,
trade, business, profession or organization should be of
accounting information as an aid to management decision
making.

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5.3 RECOMMENDATIONS
For the research work has been carried out and
evaluated. I therefore stand to be of the opinion that for a
trade to be efficient there is need for every staff of the
organization to have at least basic knowledge of
accounting for every interpretation and flow of
information.

35
 BIBLIOGRAPHY
AZEEZ Y.O (2003): Public sector Accounting (An
introductory Approach), Ilorin, Olad Publisher.
BROWN KAHR; Decision for the Manager
DOUGLAS B. Advance Chartered Account Pitman
Publication Pitman Publisher 2nd Edition.
LANMAN, M.N & GOYAL, S.N (1999): Principles of
manager Accounting.
LIYOD REMSEY (1973): Management Accounting McGraw
Hill Publisher.
WALTER, B. MEIGS & ROBERT F. MEGIS (2000):
Accounting the basis for business decision

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