Manufacturing Firm – The Role Of Financial Manager

Manufacturing Firm – The Role Of Financial Manager : (A Case Study Of Emenite Limited, Emene Enugu)

Manufacturing Firm – The Role Of Financial Manager : (A Case Study Of Emenite Limited, Emene Enugu)

It has become a well known fact that without money a business cannot function consequently an understanding of finance, which is the appreciation of the role of money and its ability to measure. The measure of a business is essential for good management.

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However, money can be likened to a lubricant, too little and the business is a wash with all types of project for using the surplus cash some of which may be good risks while others may penalized the business. Again money presents its own problems particularly when inflation sets in and as a result the purchasing power will change from time to time.

Now, the role of financial managers becomes imperative consequently, the professions is one of the professions which is still struggle to assume its place in an organizational structure with the increasing complexity in human organization of there has arises more and more.

Specialization of people in various disciplines and therefore finance must take its on position. Financial manager is an expert trained in the field of finance, and the functions include planning for acquisition of funds and utilization of such funds in ways that will maximize the efficiency of an organization. The project researcher intended to project the role of financial manager as regards manufacturing firms and as J balty puts it “an adequate funds and cash flow is essential more than this, a business cannot afford to stand still.

In any competitive field it will be essential for improvement to introduce new products and to expand”. However, despite much publications and emphasis placed on the role of financial manager in any business organizations, most of our policy makers whether in private, public and governmental establishments have not realized these vital roles and the resultant effects are stagnation and collapse of many of our business activities with the claims and counter claims by various professionals and near professional. There is establishment among many business organizations which are confronted with certain problems and which need expert advice. In this case management’s must try to recognize and consult the service of financial manager this alternative in business is to be very carefully considered before a judicious choice can be made.



The study of financial management has undergone a lot of changes since its inception as a subject of its own.

According to E.F Briham and F. Weston “during 1940s, 1950s finance was continued to be taught as descriptive institutional subjects viewed from the outside rather than from in his own view stated that at some decades ago, the scope of financial management was circumscribed to the raising of funds whenever needed and no significance was use to be attached to the day to day financial decision making and problem solving. But in the recent years the concern of the financial managers besides his traditional function of raising funds is to determine the size and technology in setting space and direction of growth and in shaping the profitability and risk complexion of the firms by selecting the best asset mix and by obtaining the optimum financing mix the functions are sum margined as:-

(i) Raising of funds to finance projects

(ii) Employment of the funds raised in viable projects.

(iii) Management of cash arising from this prefect

(iv) The return of funds to the financing sources.


According data provided management with essential information on the financial status of the organization necessary for its present stability and future well being. It enables the profit to be computed and a balance sheet to be competed from these it is possible to measure the effectiveness of a business and compare its potential with other investment opportunities.

Management must recognize the advantages of accounting data and the benefit derived from its utilization. They must be aware of the need to understand the information presented in accuntry statements and also realize that annihilated evaluation of the essential financial data can make the entire difference between success and failure. Methods used in measuring an organization’s performance of progress are usually percentages and ratios which are expressed in financial terms.


The research into the role of financial manager has become necessary on that most of them are operationally inefficient and much behind in meeting the purpose for which they were established. In fact many of the manufacturing firms in our country are financially unprofitable and their performance calls for drastic review. Financially, manager has a leading part to play in decision making process which determines the aspects of profitability and growth. If an industry is to improve on its efficiency, management must recognize that the financial area has an unrepentant role to play as other aspects of the business.



This study entitled, :the role of financial manager in a manufacturing firm “ attempts to determine the extent to which the role of financial manager affects the profitability of manufacturing firms with a particular reference to emanates building product company limited (Emene)


The project researchers intended to fund out whether :-

i. Emanates Building product (Emene) limited utilizes the services of financial manager ?

ii. The firm has adequate funds for its operation?

iii. The workers are being paid regularly and why.

iv. The firm meets its debts obligations?

v. The firms return on capital employed has been improving?

vi. The firm has generally made an improvement since its inception? And to make recommendation on the way of improving the system.


The objectives of this study are:

i. Identity the role of financial manager in a manufacturing firm with particular reference to Emenite Building product (Emene( limited.

ii. Determine the contribution of financial manager to Emenite. Building product (Emene) limited with particular regards to ,

a. Capital acquisition

b. Investment decision

c. Profitability

d. Divided policy

e. The general growth and to make recommendation where necessary.


This study when completed will enable the policy makers of various manufacturing and non – manufacting firms and government establishments to re – consider their stand on the realization, acceptance and utilization of the services of financial managers.

Again the study will go a long way to removed the management that without financial manager that they cannot take financial decision and implement them successfully.

Not only will these it also project the role of financial manager towards organization effectiveness like capital structure, asset structures profitability and general growth. This study will also be of paramount umpestance to all the students in the school of business in particular and will also act as reference material to the school library.


This study is intended to cover the system of financial control as is utilized in Emenites Building product limited Emene as it affects its operations with regards to survival expansion profitability and moreover growth, hence mathematical treatment and application of such system are not within the scope of this study. This is also limited to Emenite Building product limited Emene. The reason behind this limitation is that the researcher is a student facing both time and financial constraints. Another reason is the nature of the topic choosing, many study firms will pose some problem knowing our people’s attitude towards financial matters, being afraid of unknown consequences ranging from management incormpletence to exposure. The project researcher also in his review of elated literatures and studies made use of texts, journals, activities and other write ups.


i. DIVIDEND DECISION: Involve the criteria employed for the allocation of profit to dividends to shareholders and retention in the business for operation.

ii. FINANCE: Is a body of fact, principles and theories dealing with the raising and using of money by individual, business etc.

iii. INVESTMENT DECISION: Include all the criteria managers in choosing among alternative investment opportunities that is the best one.

iv. FINANCING : Embrace the supervision of a firms cash and other liquid holding with a view to raising additional funds when needed.

v. CONTROL:- Includes the use of readily understood, reliable and standard techniques aimed at identifying deviation from planned objectives and ensuring efficient performance.

vi. FINANCIAL SYSTEM : Consists of institutions and markets which serve companies and individuals in financing the acquisition of capital goods and services in investing of capital and in transferring the ownership of securities.

vii. FUNDS : Are sun of money available in a business organization which is generated internally or externally and which is available for business purpose.

viii. MANAGEMENT :- Mans controlling, directing innovating, planning, co –ordinating etc.. of activities of an organization with a view to ensuring effective and efficient performance.

ix. FINANCIAL RESOURCES:- Includes these parts of a business resources that are in monetary terms.

x. FINANCIAL DECISION:- Involves all the criteria and techniques employed by financial manager to obtain a required fund.

xi. SYSTEM:- Include all the interrelated techniques and various, used in assessing the best sources of financing the best investment opportunities and in ensuring efficient allocation of profits.

xii. CAPITAL MARKETS:- Include the Nigeria industrial development bank the Nigeria Building society insurance companies the stock exchange market, the national provident fund, commercial banks, individual investor etc.


Below is a review of local and studies made by other authors, writers, contributors, researchers etc. on role of financial management.

In his work, “assessing the financial management in companies” Mr L oluyemi Foalipe while addressing the Association of Accountants student of university of Nigeria Enugu campus, stated that “A business of firm needs to define its concept of business to provide an environment for financial management. The concept should include a statement of the firm’s basic philosophy, objectives and of the firm’s future pattern of resources”. He explained that these objectives in components of the concept should deal with not just the fundamental objectives but also objectives in each of the firm’s results areas capital of being qualified and integrated into financial management to guide the manager.

Viewing the position and role of financial in the present Nigeria solution, Mr. A.O Olumba, a financial expert and a member of the institute of chartered Accountants of Nigerian in a symposium organized by the institute in Lagos said that “This country has lost billions of naria through unreasonable rejection of sound idea and advice.

He explained that our policy makes have not at any time sought or needed the advice given by financial experts. In his work” The causes of business failure Mr. Stuat Byer state that “the secondary bank crises was a dramatic demonstration of the trouble that can result from the branches of the basic principles of financial management”. These principles he maintained, “Not only apply to the financial organizations of all business and bankers are well placed from their own experience to help warn their customers of financial risks”. He explained that long-term investment and also shot – term finance should be matched with short –term investment, and that any his match may be more profitable but it is more dangerous . He also emphasized that it would be noted that to get the best return from assets, it is necessary to maintain the current assets only at a sufficient level to met current liabilities plus a margin for safety. He went further to contend that having a large margin is good but it is not the most margin is good but it is not the most efficient way.

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“Promotion and development of small. Scale and medium scale enterprises in Nigeria” Mr. E.N. Ogbe, former Director of research Central Bank of Nigeria while speaking at the First National workshop on the above topic in Lagos stated that small and medium scale industries in Nigeria are finding it difficult to grow because of operational problems. He identified the problems confronting them as financial, managerial, technical and commercial. He said that financial problems have been articulated in the past and arises primarily from the entrepreneurs own limited capital and inability to top maximum benefits from the resources of the organized financial sectors and traning as well as he inability to purchase expert advices. How to finance your business, Mr E.C Uzochuwu while addressing the association of Accountants students at the university of Nigeria Enugu campus stated that “one must not under estimate the difficulties further arising from the lack of capital need not only for the plant and equipment but also for three other purposes which re some times overlooked;

(i) Working capital

(ii) Expansion of capacity and

(iii) “Something “to tide cover the loses that in the first few years are almost interruptible because produced demand”.

Practical steps in raring Business finance from Bank”, Mt. G.C. Akwaeze in his book titled above stated that it costs. Money to hold money. He explained that borrowed money must be handled with greater care to ensure that it is judiciously utilized to generate surplus required to service the loan (or other forms of finance) and leave a reasonable return to its uses. This he stated that alternatives in the investment in any business of such funds must be carefully considered before a judicious choice can be made. He explained that a firm which wants to go into business might find that, it may be better off as far as his earning of income is concerned, by investing. Its others while running its own business with substantially cheap borrowed money he stated that “suches” they say, “if properly used (and is a man’s fault, if they are not) Must be productive.

Capital formation and the role of financial intermediaries in Nigeria economy “ Mr. D.C Chuke, the controller of operation Central Investment Corporation Enugu, in his realization of the role of financial manager told the students Accountants of Enugu campus of university of Nigeria on the above topic that, the aspects of economic growth in particular should be of interest to you as an accountant since you will be called upon to design control system and monitor feedback that will enable planners to improve on past performance”. He therefore, went further to explain that financing is one of the vital factors that contributes to success or failure of any business and categorized financing or economic growth into two basic questions.

i. Are the funds available sufficient to attain the desired level of capital formation ?

ii. Is the distribution of the fund for capital formation to the various sectors being done in such a way as to ensure that maximum productivity is achieved?

In this work, “A call for review and reorganization of operational programme of public enterprises in the Nigeria Economy”. Alhaji Abubakar, . The managing director, Nigerian industrial Development Bank limited, stated that “there has been a charion call by all and sundry on the policy markers of this country to re – appraise our national priorities with the aim of pulting country on the right tracks”, He went further to access the performance of our public corporations of them are grossly inefficient and are much behind in meeting the purpose for which they are established.

Financially, he disserved, they are most unprofitable. He stated that they have maintained a consistent record of increasing losses year after year and have depended on the government subsidy for survival. He explained that among some factor contributing to such situation are lack of proper loan management, the mode of funding the public enterprises and the lack of accountability.

The governor of Benue Sam Akump in this contribution appreciated the need for diversification of available funds to viable and profitable projects noticed that his state has been doing times of Nigerian that “our state being an agricultural state, is our intention to reactivate them and on plate those that are viable in a bid to industrialize the state”. Here the governor was optimistic that the agricultural sector in the state would earn the state more return if activated and funded well.

In his article, “The role of economist financial Analyst in the industrial revolution of Anambra state”, Dr Don N. Ike, Associate professor in the department of Banking and finance Asutech, Enugu Campus, stated that Anambra state is divesting itself from some major industries to increase opportunities for private initiative ineffect, the state is proised for an industrial revolution to correct the past inequity, which left the state largely on industrial desert.

However, his question is “what then is the role of the economist/ financial analyst in this process, inorder to aid effective industrial programming and profitably of enterprises, to sustain the revolution and reduce false start up and high failure rates, and the malaise of our industrial past ?”

He stated that the economist / financial analyst is required both in project development and implementation. Project development, he explained, involves project appraisal from conception to implementation. It runs the gamist from project indication, preparation of profiles. Pre – feasibility and techno –economic studies to certification of project viability.

Project implementation on the other hand, he explained, is the transaction of the result of the appraisal into physical assets, the assembly of relevant sources for the production of physical products: The project appraisal, he stated involves financial, economic and financial analysis all often involved in techni – economic of feasibility. The economist helps in considering the economic, commercial, financial technical and political available effecting and to be effected by the project. The financial analyst, reviews the projects with a view to determining the short – term and long – term cost implications, as well as the financial benefits likely to accrue from the investment “ Financial analyst, therefore, considers the financial structure cost of funding and profitability of the projects.

It encompass a balance sheet, profit and loss account and cash flow analysis. Positive, net present value is necessary to adopt a project. Also the role of the economist / financial analyst is crucial in the project implementation which involves construction of building, purchase of plant and machinery recruitment of personal and purchase of raw material for actualization of the investment proposal. Thus project implementation means the assembly of men, money and material for eventual operation of the project. Proper equipment, raw materials and personnel must be assembled and the cost and consequences of going for absolute equipment can easily be de – phased by the economist / financial.

The economist/financial analyst is an indispensable expert in pointing to improper implementation of strategies, assessing costs and consequences of certain executive actions. The deregulation of interest rate is good thing, he stated but in implementation high interest rates have emerged with high interest rates marginal efficiency of investment would fall and without lower levels of private and public sector investment can be attained. He further asked, “how can we have industrial revolution with lowers levels of investment ? “ He stated that this is a contradiction. The economist and financial analyst would be able to printout the need to reduce interest rates, raise the marginal efficiency of investment and help attain large volumes of investment both public and private.


Finance as many foreign authors view it has for long been considered a part of economics and corporate finance emerged as a separated filed of study in the early part of this century. In fact even so, under gone a lot of changes since it involved as a separate study.

As van Home in his book entailed “financial management and policy” put it, “at fund, it death with only the instruments, institutions and procedural aspects of capital markets.” The interest then was on promotion consolidation and mergers. However, by 1920s, technological innovation and new industries created the need for fund, and these necessitated the study of finance to emphasis. Liquidity and financing of the firm. Rather than internal management, attention was shifted to external financing.

By 1930s, van Herne stated , the depression turned the study of finance to defensive aspects of survival, presentation of liquidity, bankruptcy, liquidation and reorganization. This period witnessed the collapse of many companies, which brought cries for a sound financial structure. The traditional approach to finance emerged in 1950s and it involved the analysts of the firm from the viewpoint of an out did not emphasis decision making within the firm. Also the advent of computer evolved a complex information systems. This provide the financial manager, the data from which to make sound decision. Capital budgeting an other allied considerations were applied to sweep away changes that were to come.

New method and techniques were developed for selecting capital investment projects that led to a framework for efficient allocation of capital within the firm. The financial manager now deals with the funds committed to assets on the basis of an appropriate and objective acceptable intention.

The major event according t van Herne in 1960s was the formulation of portfolio theory and its application to the subject the market Ritze first propounded it in 1852. Van Herne gave the three major financing decisions as:-

i. Investment decision

ii. Financing decision ]

iii. Dividend decision .

He stated that because the future benefits from investment are not know with certainly investment proposals necessarily involves risk. Then he explained should be evaluated in relation to their expected return and risk for they are the factors that affect the firm valuation in the market place.

Financing policy deals with the percentage of the company’s earnings paid or payable to stock holders, the stability of the absolute dividend and splits and repurchase of stock. ‘The value, if any of the divided to investors must be balanced against the opportunity cost of retained earning cost as a means of equity financing”.

I.M. Pandey, in this book entitled, “financial management” stated that subject matter of financial management has been changing at a rapid rate . He opined that at about 1920 the scope of financial management was circumscribed to the raising funds whenever needed and that no significance was used to be attached to the day to day financial decision making and problem solving. “As a consequence “ he stated “the traditional finance texts were structured around this theme an contained disproportionate discussion of the instrument and institutions of raising funds and of the major events such as promotion re – organization, re adjustment, merger, consolidation etc. When funds were required to be raised”. He explained that by 1950s the emphasis has shifted to the wise utilization of funds.

Today, he asserted, the modern thinking in financial management gives greater importance to management decision. The financial manager is not a passives role of scorekeeper of accounting information and arranging for funds whenever in top needed. He now occupies a key position in management and plays a dynamic role in solving complex management problems. His responsibility is mainly shaping the fortunes of the enterprise and unloving of allocation of capital, it is his duty to ensure that funds are raised economically and used in the vest efficient and effective manner.

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Because of this change, Pandey stated, the descriptive treatment of the subject of the financial management is being replaced by a growing analytical content and sound theoretical underpinning Pandey explained that: financial management is that part of managerial activity which is concerned with planning and controlling of managerial activity which is concerned with planning and controlling of the funds financial resources”.

He stated that the subject is of immense interest to managers because among the most crucial decisions of the firms are those related to the finance and an understanding of the theory of financial management provide insight with conceptual and analytical insight to make these decisions skillful. He outlined the these managerial finance functions as:

i) Financing (or capital mix ) decision

ii) Investment (or Assets mix) decision and

iii) Divided or profit allocation decision

These financial decisions, he stated, have a direct concern in the firms decision, to acquire or dispose of assets and required his commandment and recommitment of funs on a continuos basis. These, the finance functions are saved to influence the reduction, marking and other functions of the firms. These in consequence, will affect the size of the firm and automatically, the value of the firm.

The financial manager, he contended, must have a broader view and fore – sighted out – look and must ensure that the funds of the enterprise are utilized in the most efficient manner. “He must realize that his action’s have far – reaching consequences to the business because these actions will influence the size profitability, growth, risk and the survival of the firm, and as a consequence will affect the overall value of the firm” G.L Johns in his book, “financial measurements for manager”, stated that ”without money a business cannot function. Consequently an understanding of finance, which is appreciation of the role of money and its stability to measure the progress of a business, is essential for good management “. He explained that money can be likened to be a lubricant, too little the business grinds to a half and will all types of project for using the surplus cash, some of which may be good risks while others may penalize the business. He stated that finance play a vital role in any business and those who are responsible for the policies governing a company operations must realize that an artificial data can make the entire difference between success and failure. He explained that a firm’s record whether past activity or projected fore – cast of future events the data there in must ultimately be expressed in financial terms and presented some of the methods of evaluation of a company’s performance as percentages and rations.

James Bathy in his book titled “management Accountancy “stated that an adequate fund and flow of cash is essential more than this, a business cannot afford to standstill. In any competitive field it will be essential to improvement to introduce new products and to expand”. He explained that experience has show that a business does mot remain static, there is a tendency to go forward or backward, but not to stagnates .

However, he stated that for expansion to take place, there must be adequate financial resources. He also outlined that the finance required would be influenced by the following:-

(i) Fixed assets necessary for producing and distribution the products. Plants, machinery and equipment’s

(ii) Raw – material, pie chart and miscellaneous supplies to be purchased, and wages and other expresses which, have to be paid.

J.L Brown and L.R Horward, in their book entitled “managerial According”. Stated that an efficiently managed business will not have sums of any consequence surplus fund to its ordinary requirement. Rather they suggested the use of budgeting to ensure that adequate funds are available to meet contingencies and invest the surplus within or outside the business. The investments, they suggested may take the form of purchasing new assets repayment of loans and moreover purchase of an existing business either “verticality or horizontally”. All these, they explained, are aimed to the expansion of the business, introduction of new products, greater or faster business growth “E.F Brightam” and F. Weston in their book entitled management finance, stated that during 1940s and early 1950s finance was continued to be taught as a descriptive institutional subject viewed from the outside rather than from the view point of management. The emphasis them was on maintaining the liability side of the balance sheet that is the left hand side. But they went further to explain that, the emphasis was later expanded to right hand side of the balance sheet that is the asset side.

Thus, they stated the focus of finance shifted from the outsides point of financial decision within he firm were recognized to be the crucial issue in a corporate organization. The result of these decisions they concluded have been the merging of investment and corporate finance and later they described the functions and responsibilities of financial manager as “planning for acquiring and utilizing funds in ways that will maximize the efficiency of the organizations operations” Thus the qualities required of a financial manager are acquisition of sound knowledge of how funds are raised and ho sound investment decisions are made and how efficient operation stimulated. These required choosing among large numbers of alternative sources of funds available and uses of funds. These alternatives includes:-

i. Long – term projects versus short – term projects

ii. Long – term sources versus short term sources

iii. Internal sources versus external sources

iv. Higher rate of return versus lower rate of return etc.

The alternative sources of external firm uncial can be obtained in money market or in capital market.

W.S. Cuzan in his book titled “principle of financial management”, stated that “historically finance has been concerned with the acquisition of funds. The administration of working capital firm to preserve the liquidity of the firm and more recently the management of fixed assets or current assets”.

These functions he stated can be put into three topics, which include ;

(i) Decision pertaining to the acquisition of funds.

(ii) Decision pertaining to the effective use of the funds and

(iii) Decision required enhancing the profitability of the firms.

While preserving it liquidity in his observation then, the capital stricture was viewed in terms of its impact on and nationally on profitability. Norman Thom in his book, titled “ management Accountancy” Gave the break down of the objectives of finance as :-

i. To promote the finance to enable the business to carry out its planned operation.

ii. To ensure that the best mix of source of finance and allocation to he activities of the business, to optimize the use of finance in the company.

iii. To use the resource of the business to achieve its overall objective.

iv. To ensure adequate cash flow within the period to balance sheet – term needs with the long – term needs.

v. To obtain a balanced financial structure for the business between equity and loan capital.

vi. To incorporate in the financial planning, growth requirements, realistically fixed for the business within a reasonable time scale.

vii. To provide a return to share holders of the stability and strength of the enterprise related to the funds to be retained in business to finance the future growth.

viii. To invest short – term funds surplus to current requirements in temporary investment to obtain return on idle cash.

From the above literature and studies made by different authors, writers, researchers contributors etc. reviewed. One can construct efficient financial management’s in any business organization as right step towards progress. They have in one way or the others described the role of financial manager as geared towards profitability, growth, expansion and the overall valuation of the business. This they pointed out that the role of financial manager as geared towards profitability, growth, expansion and the overall valuation of the business. Thus they pointed out that the role of financial manager is always planning for the acquisition of funds i.e the best capital structure, sound investment decision and sound decision as regards cash inflow and out flow arising from the operation. The job is o shape the fortune of the organisation by taking the best investment opportunity and obtaining the best capital mix to finance such projects.


In the course of this research the project researcher made the following findings in the account department of Emenite, limited (Emene) which are analyzed as follows:

The structure of any organization gives the position, ranks and duties of individual staff and to whom they are responsible to. Infact it gives a unique view of the organizational setting.

Manufacturing firm like Emenites limited has influences of too tittle authorities that make the management and organization suffer. Above is a typical organizational structure of the company, showing the set up starting from the organization and its influential functionaries to the rank and file groups of Emenite Ltd. Looking at the diagrame above, we could see that all influences are geared towards influencing the company through the chief accountant. The chairman of board of directors directly super intend over the actions of the chief accountant.


In Emenites limited (Emene) the chief department and therefore the financial manager of the firm. The is assisted by two qualified accountants with the post of.

i. Works accountant and

ii. Financial accountant

The chief accountant is also a senior executive in the company: His duties includes;

i. He is responsible for all the accounting functions of the firm.

ii. He gets report of the final accounts through the works accountant and financial accounts through the works accountant and financial account.

iii. He prepares management accounting data

iv. He handles the company’s audit arrangements.

v. He is responsible for the banking operations of t he firm.

vi. He handles the company’s tax matters.

vii. He is responsible for the company’s financial correspondences.

viii. He is the final authority on approval of funds or financial expenditure.

ix. He is responsible for the preparation of place and budget of the firm.

x. He prepares the chief accounts annual reports.

xi. He is responsible for all the security arrangements of the company’s fund.

xii. He is responsible for the general supervision of all the financial function of the department.

xiii. He is responsible for daily, monthly preparation of the company’s financial position.

xiv. He advice the chief executive on matters like short – term investments and project timings.

xv. He acts as the chairman of the budget committee.

However, in an interview with the works accountant, he said that the duties enumerated above conform with their day to day activities in the firm and agreed that the objectives of the firm have not been fully met as the company has been making little profit or at times losses. He was of the opinion that problem of the company is not with the account department but can be attributed to many other factors. The company he said has been in existence for many nears and is still maintaining its financial obligations though some times looses occur.

The workers are being paid regularly and customers who always seek credit facilities are being granted, and cash payments are been made regularly to the suppliers on delivery.

The company’s machine have been in operation for years and adequate maintenance is given to them to ensure continuous flow of production. However, the company has its own problems but the problems of the financial manager in the firm are many and require an expert to handle them as the year both natural and man – made.

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The situation become discouraging in the absence of in service training and other short term course which are features of accounting service when taken into consideration. The financial managers among the accounts officer are very negligible. This shows the in adequately of financial manager in the firm.


Is thee a proper internal control system in operation in your firm ?


In your opinion, do you believe that if qualified manager are in man8ufacuring firm, it would have efficient management of firm funds ?


Do you agree that there is inadequate and capable accounting manpower such as financial managers in the firm ?

Do you agree that remuneration is the factor responsible for the inadequate of financial manager in the firm ?


Does the firm have problem of recruiting and retaining financial manager.


Do you agree that there is lack of financial manager role in the manufacturing firm and where the exists it is inadequate ?


Hypothesis are the ideas, believes or assumptions put forward by any one for the purpose of helping and guiding him in arriving at a reasonable conclusion.

These assumptions are believed to be true (original) but in result of a research many prove otherwise.

This then becomes the need to test any of these hypothesis are generally referred to as research hypothesis inorder to be able to test this research hypothesis statistically, they must be formulated in test table form with operational definitions of t he proposed relationship. The formation suggests a statistical hypothesis that is in the focus of statistical inference.

These statistical hypothesis are :

i. Null hypothesis (H0)

ii. Alternative Hypothesis (Hi)

While the Null hypothesis is the assumption that there is no difference between the hypothesis and the result, the alliterative hypothesis describe explanations not covered by the null hypothesis.

It must be noted that the expected value used while testing the hypothesis are determined, based on the assumption and number of the response available equal number of the response is used for the expected value. Therefore ,the chi – square (x2) will be employed in testing the hypothesis where chi – square is given (x2) = x2 = (0I – 1)2

O = Observed frequency

I = Expected frequency

Degree of freedom = ( r – 1) (C – 1)

R = Number of row

C = Number of column

It is testes at 5% level confidence .

Table 6 Question used in testing hypothesis.

Hypothesis Question

i 17

ii 12

iii 24

iv 19


That there is inadequate and capable manager manpower such as the financial manager in the manufacturing firm. The verification of this hypotheses was supported by the analysis on table 7 where it was shown that there is an inadequate financial manager in the firm while 5 respondents disagreed.

However, further verification was conducted by testing with chi – square x2 distribution which has formula.

X2 (0 I – I )2

Where x2 = Chi – square

0I = Observed frequency

Ei = Expected frequency


This is inadequate and capable financial manager in the firm.



The problems of the effective financial management in a manufacturing company with particular reference to Emenite limited, have been identified and then it will be appropriate at this stage to make some commendations which will enhance the effective management of financial resources of any firm with particular reference to the above company. These recommendations are as follows :-

The board of directors should recognize financial management as one the most important and crucial aspects of activities within the organization. The board should also give financial manager a free – hand to exercise his professional expertise in raising funds, choosing among alternative investment opportunities and management of cash in – flow and out – flow like dividend decisions.

The financial manager must be conscious of the liquidity of the firm. That is, he must ensure that the current assets total is always high enough to take care of the current liabilities or obligation and leave some margin for investment. Those should do by emphasizing cash payment from the customers and delaying payment to supplies if possible. He can also dearly some sundry, expenses, tax wags etc. to increase the cash holding of the firm to make advantage of any profitable investment opportunity.

Proper accounting data must always be available to the financial manager which is the care of all the essential information on the financial status of the company.

The financial manager must be an that the need to understand the information presented in accounting statement and also to realize that an articulated evaluation of the essential financial data which presents the company’s present and future well – beings can make the entire difference between success and failures.

There is the need to ensure that people with the skill and expertise are employed to manager the firm’s financial resource as this is necessary as the management rely on their professional expertise in taking and implementing financial decision. This therefore, the financial managers must also realize the importance of forecasting and budgetary control which help to project the cash in – flow and out – flow of the company and guide against unforeseen circumstances like low sales high cost of production etc.

To reduce this ugly situation in which the firm funds itself today, a little or total diversification of its funds to other viable prefects and business or firms can save it. The financial manager must ensure that ideas (which the company made at the early years between 1981 and 1989) would have made the company one of the most viable companies if the funds generated then were properly managed. So this recommendation is in conformity with the saying that “riches if properly managed and its man’s fault if not must be productive.

The financial manager must be in course of his duty bear in mind that every benefit has its own cost or risk associated within and therefore must adequate them to ensure to provide for such cost and leave a surplus for the owners. Hence he must be conscious of the interest rates, discounts allowed by customers and other obligation’s involving costs with the firms. The financial manager should concentrate his effects in obtaining the best capital mix and taking the most profitable investment opportunity. He should be conscious of the financial risk that are involved investments.

He should ensure adequate matching of long – term capital with long – term investment so as too maintain the balance sheet structure of the firm.

Also the financial manager must ensure of contingencies and fixed cost .

The financial manager should note the time value of money in his day to day must ensure hat funds available on generated from such sources like provision for depreciation have to be re –invested into any other prefect rather than learning it idle in the firm. The financial manger should also be aware of the financial markets with regard to their requirements and modes of operation to enable him plan for and obtain funds easily whenever needed. He must also try to estimate the life span of its fixed assets and should make provision for obsolescent.


The roles achievement and problem of financial manager in Emenite limited (Emene) have been studies above. The roles of the financial manager as the works accountant sees it confirm with his day to day activities there. The accounting department is a fortified one with about four qualified accountants trying to review the company, ill – health which has been existing for more than 6 years.

However, the roles as specified in the chief accountants schedule are not enough to term him a financial manager and from the observation the researcher is of the opinion that role do not recognize the norms and culture of the financial management as all the firm’s financial management as all the firm’s financial aspects are left to charces.

The financial manager must be integrated in all the policies of the firm and there is the need to educate the accounting records. The researcher is of the opinion that if the above recommendations are filly implemented and abided by the management, shareholders and the financial manager then we shall be talking of effective financial management and look forward for a healthy firm with the most profitable opportunity.


tick x in appropriate boxes and give answer where necessary.

1. Sex Male [ ] Female [ ]

2. Qualification : WASC / B. SC and [ ]

3. What is the type of company you run manufacturing [ ]

Construction [ ] Commercial [ ]

Others specify [ ]

4. Does your company carry out recurrent exercise in a systematic and well controlled way.

Yes [ ] No [ ]

5. Does your have good plan format which highlights the strength and weakness of company and the constraints to improving efficiency and objectives ?

Yes [ ] No [ ]

6. How do you view financial manager record keeping and documentation in your company firm ?

Good [ ]

Fair [ ]

Poor [ ]

Bad [ ]

7. When was your company audited last ?

Since past four years [ ]

Since past three years [ ]

Not audited at all [ ]

8. How regularly has the audit been in your company firm?

Every year [ ]

Every two years [ ]

9. Does your have internal audit department

Yes [ ] No [ ]

10. Has there been any fraud or misappropriation of the company’s funds property ?.

Yes [ ] No [ ]

How far has proper management audit helped to improve the role of financial manager ?

a. No case of fraud since the first audit [ ]

b. The auditing process has no impact on the rate of fraud in the company [ ]

c. There is fraud but the frequency has reduce [ ]

12. How do you assess the effectiveness of the financial manager with regard to effectiveness of the financial manager with regard to evaluating the company’s / Firm’s performance very efficient [ ]

13. What type of result does your company usually obtain after carrying out or evaluating or assesses the effectiveness of financial manager

Very Good [ ]

Good [ ]

Poor [ ]

Very Poor [ ]

14. Is the financial manager given the necessary co-operation by the workers.

Yes [ ] No [ ]

15. If the answer to question 14 is No give any two reasons.

a. ————————————————————————

b. ———————————————————————–

16. Have you or are you been a financial manager ?

Yes [ ] No [ ]

17. If answer is Yes, what problem do you encounter or have encountered in course of your role?

a. Absence of proper books of account and documentation’s [ ]

b. No co –operation from the client [ ]

c. There is limited co-operation from the client [ ]

18. Does he role of the financial manager contributed to the growth of the firm.

Yes [ ] No [ ]

19. If the answer in question 18 is yes, what are the reason behind it ?

a. —————————————————————–

b. —————————————————————–

c. —————————————————————–

20. Does the firm achieve their objective without the financial manager ?

Yes [ ] No [ ]

21. What suggestions have you to make to ensure that proper efficiency is carried out by the financial manager ?.

a. ————————————————————————-

b. ————————————————————————-

Manufacturing Firm – The Role Of Financial Manager  : (A Case Study Of Emenite Limited, Emene Enugu)

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