ICAN PUBLIC SECTOR ACCOUNTING AND FINANCE SKILLS LEVEL TOPIC: SOURCES OF GOVT REVENUE & FUNCTIONS OF FINANCE OFFICERS WEEK TWO QUESTIONS Kindly go through chapter 2 in the video lecture before you attempt the questions because the topics have been simplified and analyzed for easy understanding QUESTION 1 STARRY GOLD ACADEMY +2348023428420, +2347038174484, info@starrygoldacademy.com, www.starrygoldacademy.com Page 1
1a. Write short note on the following: Self- accounting Officer Sub - Accounting officer Public account committee Vote Controller Director of Finance and Supply b. Itemize FOUR powers of Auditor-General. c. What is a DVEA? State the reason for keeping such book in public sector. The chief accountant in charge of expenditure in the ministry of health, marada state, supplied the following information for the first quarter 2015, fund has been released for purchase of stationery, under head 2005, sub head 2002. The following additional information are available: a. Amount released on AIE/MSH/2005/10 dated 15 Jan 2015, was N20million STARRY GOLD ACADEMY +2348023428420, +2347038174484, info@starrygoldacademy.com, www.starrygoldacademy.com Page 2
b. On 18/01/15, LPO no 01/005 was issued to Good day press ltd, Lala road, marada for the printing of the ministry s payroll and other related documents for the sum of N2.5million. c. On 20/01/15, cash purchase of various stationery items was made for the sum of N50,000, as detailed on payment voucher no 01/005. d. On 31/01/15, Good day press ltd delivered the payrolls and other documents. The company submitted a bill of N3million for settlement. It attributed the increase in price to the escalating cost of materials. However, the increase was approved and payment effected, accordingly. REQUIRED: With the aid of an annotated Departmental Vote Expenditure Allocation Book, write up the entries. QUESTION TWO 2. (a) How will you describe the Federation Account,? STARRY GOLD ACADEMY +2348023428420, +2347038174484, info@starrygoldacademy.com, www.starrygoldacademy.com Page 3
(b) What are the sources of revenue into this account and how has it been administered over the years? (c.) How many revenue heads are payable into the Consolidated Fund Account, and which line of expenditures is it used to finance? (d) Prepare Federation Account and Consolidated Revenue Fund from the following information: INFLOWS N 000 Import duties 400,000 Export duties 300,000 Excise duties 200,000 Petroleum profits tax 80,000,000 Companies income tax 71,000,000 PAYE: deductions from the emolument of the Armed Forces 400,000 Police personnel 30,000 STARRY GOLD ACADEMY +2348023428420, +2347038174484, info@starrygoldacademy.com, www.starrygoldacademy.com Page 4
Residents of Abuja 20,000 Dividend from Federal Government Investments 120,000 Outflows: Remuneration of Statutory Officers 13,800,000 Recurrent expenditure 1,500,000 Transfer to: Development Fund 2,500,000 Contingency Fund 20,000 Note: The revenue allocation formula is: Federal Government 52.68% State Government 26.72% Local Government 20.60% STARRY GOLD ACADEMY +2348023428420, +2347038174484, info@starrygoldacademy.com, www.starrygoldacademy.com Page 5
QUESTION 3 a. Explain the following terminologies in relation to cash office in Public Sector Accounting: One Vote Line Officer Controlling Expenditure Special Imprest Holder Above-the-line account Below-the-line account Financial Assets b. Mr Nonso, a revenue collector in a magistrate court in Ajasko, provides the following information for the month of July 2014: July 2014 Payee Amount Payment Reason STARRY GOLD ACADEMY +2348023428420, +2347038174484, info@starrygoldacademy.com, www.starrygoldacademy.com Page 6
=N= 03 Jones John 500 Age declaration 03 Theo Ajadi 3,350 Court Fine 04 T.Oloko 2,500 Court Fine 06 O.Olomota 500 Age declaration 08 Adeola Kafaru 380 Court Fine 10 O. Jaguar 400 Court Proceed Doc 17 D. Aderoju 500 Age declaration 20 T. Adefeyin 2,250 Court Fine 23 K. Ajomale 300 Court Proceed Doc Nonso went to the Treasury Cash Office to pay on 18 th July 2014 and was given receipt number B841302 for the amount paid. He used receipt booklet H124301 124350. The one he issued to Mr Jones John was H124332. He cancelled receipt number H124337 because he made a mistake on the receipt. The money received in the court is Head 32 with the following sub-heads: Declaration of age 01 STARRY GOLD ACADEMY +2348023428420, +2347038174484, info@starrygoldacademy.com, www.starrygoldacademy.com Page 7
Court Fines 24 Court Proceeding document 15 You are required to: (a) Write up the Revenue Collector s cash book (b) Explain how Adefola should treat the cancelled receipt no H124337 and (c) Enumerate the activities of the Treasury Cashier before issuing receipt number B841302 to Nonso. QUESTION 4 a. In Nigeria, a preponderant part of government revenue comes from oil while only a paltry sum comes from non-oil sector. You are required to: STARRY GOLD ACADEMY +2348023428420, +2347038174484, info@starrygoldacademy.com, www.starrygoldacademy.com Page 8
i. provide two reasons why governments need revenue. ii. Explain any two components each of oil and non-oil sources of government revenue receipts in Nigeria. iii. Discuss the relative importance of oil and non-oil revenue in the Nigerian economy. b. Identify any FIVE problems of revenue generation by the State and Local Governments in Nigeria. c. Attempts are currently being made to re-invigorate local taxation in Nigeria. What measures do you think should be taken to make local taxation effective? STARRY GOLD ACADEMY +2348023428420, +2347038174484, info@starrygoldacademy.com, www.starrygoldacademy.com Page 9