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The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective
International Journal of Economics, Finance and Management Sciences
Volume 5, Issue 2, April 2017, Pages: 102-112
Received: Nov. 28, 2016; Accepted: Dec. 12, 2016; Published: Feb. 3, 2017
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Author
Philip Olawale Odewole, Department of Management and Accounting, Obafemi Awolowo University, Ile-Ife, Nigeria
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Abstract
This study examined the cause of the controversy in the implementation of the contributory pension scheme among the Ministries, Departments and Agencies (MDAs) in Nigeria. Descriptive methods of analysis were used to analyse the data. The result showed that misstatement in the disclosure of employees’ contribution is the major cause of the controversy. Also, the result revealed that the personnel cost releases to the MDAs since the inception of the scheme is 92.5% of the gross personnel cost budget of each institution while the balance of 7.5% of the personnel cost budget represents the deduction at “source” for the individual employee which is being credited to the employee’s Retirement Saving Account open with the employee’s choice Pension Fund Administrators through the Central Bank of Nigeria. More also, the findings established that discrepancies in the presentation of the employees’ deduction in the payrolls and individual employees’ payslips largely accounted for the continuous restiveness among the Ministries, Department and Agencies (MDAs) in Nigeria. The resultsshowed that some MDAs disclosed the employees’ deduction as a memorandum entry in the individual employee’s payslips andpayroll, while others disclosed it under the basic salary column as additional deduction by the MDAsfrom the monthly employee’s emolument. The study concluded that only uniform accounting treatment of the employees’ deduction in the personnel accounting records will endthe cold war in the implementation of the Contributory Pension Scheme among the employees in the Nigerian Ministries, Department and Agencies.
Keywords
Contributory Pension Scheme, Accounting Perspectives, Pension Reform Acts, MDAs
To cite this article
Philip Olawale Odewole, The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective, International Journal of Economics, Finance and Management Sciences. Vol. 5, No. 2, 2017, pp. 102-112. doi: 10.11648/j.ijefm.20170502.14
Copyright
Copyright © 2017 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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