THE EFFECT OF TSA ON INTERNATIONALLY GENERATED REVENUE (A CASE STUDY OF FEDERAL SCIENCE AND TECHNICAL COLLEGE OROZO ABUJA)
1.1 BACKGROUND OF STUDY
Treasury single account has played a significant role in the efficiency of accountability in the public sectors of Nigeria since its inception; the effect is seen in various areas of internationally generated revenue.
According to (Hamisu, 2015) stated that the Revenue Mobilization and Fiscal Commission released an audit report which indicted some banks for withholding about N12 billion revenue collected on behalf of the Nigerian Customs Service and Federal Inland Revenue Service. The revenue according to the commission is stashed in 19 banks from January 2008 to June 2012. The chairman, Non- Oil Committee of the Commission, Rev Ajibola Fagboyegun demanded for urgent return of the funds by the banks to avoid sanctions. The above issue made evident that there is inactive revenue in most commercial banks generated from the public (internally and internationally) thereby increase idle money in the bank while the federal government of Nigeria source for loans abroad. It is to this regard that the federal government of Nigeria gave directive to all revenue generating agencies to close their account with commercial banks by February 28, 2015 and transfer the exact amount into a Consolidated Revenue Fund of the Federation and Treasury Single Account as a new electronic revenue collecting platform introduced recently by President Buhari has continued to generate debate across the country
The idea of treasury single accounting was to unify all government revenue (domestic and international) into one account. The adoption of Treasury Single Account for e-collection of Government Receipts for all Federal Ministries, Agencies and Departments (MDAs) is to aid transparency and facilitate compliance with section 80 and 162 of the constitution of the Federal Republic of Nigeria 1999 (as amended), all receipts due to the Federal Government or any of her agencies will be paid into the single account where it can be properly monitored.
This idea affected most of the government parastatals in Nigeria; some of the government agencies that were affected by the policy include all fully funded organs of government, ministries, departments and agencies (MDAs), foreign missions and partially funded government establishments like teaching hospitals, medical centres and tertiary institutions. Others include the Central Bank of Nigeria (CBN), Securities and Exchange Commission (SEC), Corporate Affairs Commission (CAC), Nigerian Ports Authority (NPA), Nigerian Communication Commission (NCC), Federal Airports Authority of Nigeria (FAAN), Nigerian Civil Aviation Authority (NCAA), Nigerian Maritime Administration and Safety Agency (NIMASA). The list of affected organs also has National Deposit Insurance Corporation (NDIC), National Shippers’ Council (NSC), Nigerian National Petroleum Corporation (NNPC), Federal Inland Revenue Service (FIRS), Nigeria CustomServices (NCS), Ministry of Mines and Steel Development (MMSD) and the Department of Petroleum Resources (DPR), amongst others. (Guadian Editorial,2015:16). It is to this regard that the researcher wishes to examine the effect of treasury single account on internationally generated revenue using federal science and technical college Orozo Abuja as the case study.
1.2 STATEMENT OF THE PROBLEM
What really instigated the study on the effect of treasury single account on internationally generated revenue was due to the serious decline in price of oil in recent years has led to a decrease in the funds available for distribution to the Federal and State Governments. The need for state and local governments to generate adequate revenue from internal and external sources has therefore become a matter of extreme urgency and importance. This need underscores the eagerness on the part of state and local governments and even the federal government to look for new sources of revenue or to become aggressive and innovative in the mode of collecting revenue from existing sources.
1.3 AIMS AND OBJECTIVES OF STUDY
The main aim of the research work is to examine the effect of treasury single account on internationally generated revenue. Other specific objectives of the study include:
- To examine the relationship between TSA and revenue generation in federal science and technical college Orozo, Abuja
- To examine the effect of TSA on revenue leakage in Nigeria
- To instigate the factors affecting the implementation of TSA on internationally generated revenue
- To determine the effect of TSA on the economy of Nigeria
- To proffer solution to the above stated problem
1.4 RESEARCH QUESTIONS
The study came up with research questions so as to ascertain the above stated objectives. The specific research questions for the study are stated below as follows:
- What is the relationship between TSA and revenue generation in federal science and technical college Orozo, Abuja?
- What is the effect of TSA on revenue leakage in Nigeria?
- What are the factors affecting the implementation of TSA on internationally generated revenue?
- What is the effect of TSA on the economy of Nigeria?
1.5 STATEMENT OF RESEARCH HYPOTHESIS
H0: TSA has no significant effect on revenue leakages and internationally generated revenue in Nigeria
H1: TSA has significant effect on revenue leakages and internationally generated revenue in Nigeria
1.6 SIGNIFICANCE OF STUDY
The study on the effect of treasury single account on internationally generated revenue will be of immense benefit to the federal government of Nigeria and her agencies as it will discuss the various concepts as regard treasury single account and its effect on internationally generated revenue, the study will also examine various literature as regard the above topic. Finally the study will be of great benefit to other researchers that wishes to carry out similar research on the above topic.
1.7 SCOPE OF STUDY
The study will cover the effect of treasury single account on internationally generated revenue in Nigeria.
1.8 LIMITATION OF STUDY
Financial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.
1.9 DEFINTION OF TERMS
TSA: Treasury single account is a financial policy introduced by the federal government of Nigeria in 2012 to consolidate all inflows from the country's ministries, departments and agencies (MDAs) by way of deposit into commercial banks, traceable into a single account at the Central Bank of Nigeria.
TRANSPARENCY: a positive and clear financial statement of Nigeria
REVENUE: is the amount of money that a company actually receives during a specific period, including discounts and deductions for returned merchandise
REVENUE LEAKAGES: when the money arrives is when we realize they have not been invoiced is called revenue leakage.
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