The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective

Philip Olawale Odewole

doi:doi:10.11648/j.ijefm.20170502.14

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The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective

Philip Olawale Odewole

Published in International Journal of Economics, Finance and Management Sciences (Volume 5, Issue 2)

Received: 28 November 2016 Accepted: 12 December 2016 Published: 3 February 2017

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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.

Published in	International Journal of Economics, Finance and Management Sciences (Volume 5, Issue 2)
DOI	10.11648/j.ijefm.20170502.14
Page(s)	102-112
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2017. Published by Science Publishing Group

Keywords

Contributory Pension Scheme, Accounting Perspectives, Pension Reform Acts, MDAs

References

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[2]	Robelo, M. F. [2002]. Comparative Regulation of Private Pension Plans, Frabelo@fgvsp.br
[3]	Adams, R. A. [2005]. Public Sector Accounting and Finance, Lagos, Corporate PublisherVentures.
[4]	Ahmed, M. K. [2005]. The Contributory Pension Scheme: Institutional and Legal Frameworks, CBN Bulletin, Vol. 30(2), pp. 1–18.
[5]	Balogun, A. [2006]. Understanding the New Pension Reform Act (PRA, 2004)’, CBN Bulletin, Vol. 30(2), pp. 9–25.
[6]	Ugwu, D. S. [2006]. Contributory Pension: A New Approach to Financing Pension Scheme in Nigeria, A Paper Presented at a Seminar Organized by Mokasha.
[7]	Eme, O. I., O. A. Uche and Ifeoma, B. [2014]. Pension Reform Act 2014 and the Future of Pension Administration in Nigeria. African Journal of Business and Management Review, Vol. 4(1): 156–165.
[8]	Ayegba, O., James, I. and Odoh, L [2013]. An Evaluation of Pension Administration, British Journal of Arts and Social Sciences, Vol. 15(11): 97–108.
[9]	Sule, K. O. and Ezugwu, C. I. [2009]. Scheme on Employee Retirement Benefits of Quoted Firms in Nigeria, African Journal of Accounting, Economics, Finance and Banking Research, 4(4):48–58.
[10]	Dhameji, S. K. and Dhameji, S. [2009]. Industrial Psychology, New Delhi, S. K. Kataria and Sons.
[11]	Orifowomo, O. A. [2006]. A Critical Appraisal of Pension System Reforms in Nigeria. 10 Gon Z. J. Int’l available at http://www.gonzagajil.org.
[12]	Abade, R. [2004]. Pension Reforms Act 2004: What’s in it for you? www.Newage-online.com.
[13]	PenCon [2006]. The Future of Pension Management in Nigeria. A Paper Presented by the National Pension Commission for the Nigerian–South African Chamber of Commerce on Tuesday 22, August, 2006.
[14]	Federal Republic of Nigeria [2004]. Pension Reform Act, Abuja.
[15]	Tobiloba, A. [2014]. The New Pension Act 2014: Hope for the Nigerian Employee. Daily Independent, Tuesday, July 8, pp. 14–15.
[16]	National PenCon Commission [2005]. Frequently Asked Questions and their Answers on the Contributory Pension Scheme in Nigeria available at www.oauife.edu.ng/administration/registry/dloads/pension/pdf
[17]	Federal Republic of Nigeria [2014]. Pension Reform Act, Abuja.
[18]	Nkwaezema, S. [2014]. 2014 Pension Reform Act: Shaping the future of Pensions in Nigeria. Saturday This Day, July 5, P.49.
[19]	Ajaero, C. [2014]. Celebrating 10 years of Pension Reform. The Economy, July 5, Pp. 41–43.
[20]	Nda-Isaiah, J. [2014]. Senate passes Pension Reform Bills. Leadership, April 9, P. 4.
[21]	Usman, T. [2014]. Jonathan Signs Nigeria’s New Pension Bill into Law, Premium, July, P. 5.
[22]	Odia, J. O and Okoye, A. E. [2012]. Pensions Reform in Nigeria: A comparism between the old the New Scheme, Afro Asian Journal of Social Sciences, 3(1), Pp. 1–17.

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APA Style

Philip Olawale Odewole. (2017). The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective. International Journal of Economics, Finance and Management Sciences, 5(2), 102-112. https://doi.org/10.11648/j.ijefm.20170502.14

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ACS Style

Philip Olawale Odewole. The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective. Int. J. Econ. Finance Manag. Sci. 2017, 5(2), 102-112. doi: 10.11648/j.ijefm.20170502.14

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AMA Style

Philip Olawale Odewole. The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective. Int J Econ Finance Manag Sci. 2017;5(2):102-112. doi: 10.11648/j.ijefm.20170502.14

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@article{10.11648/j.ijefm.20170502.14,
  author = {Philip Olawale Odewole},
  title = {The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {5},
  number = {2},
  pages = {102-112},
  doi = {10.11648/j.ijefm.20170502.14},
  url = {https://doi.org/10.11648/j.ijefm.20170502.14},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20170502.14},
  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.},
 year = {2017}
}

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T1  - The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective
AU  - Philip Olawale Odewole
Y1  - 2017/02/03
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N1  - https://doi.org/10.11648/j.ijefm.20170502.14
DO  - 10.11648/j.ijefm.20170502.14
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
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EP  - 112
PB  - Science Publishing Group
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UR  - https://doi.org/10.11648/j.ijefm.20170502.14
AB  - 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.
VL  - 5
IS  - 2
ER  -

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Author Information

Philip Olawale Odewole

Department of Management and Accounting, Obafemi Awolowo University, Ile-Ife, Nigeria

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APA Style

Philip Olawale Odewole. (2017). The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective. International Journal of Economics, Finance and Management Sciences, 5(2), 102-112. https://doi.org/10.11648/j.ijefm.20170502.14

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ACS Style

Philip Olawale Odewole. The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective. Int. J. Econ. Finance Manag. Sci. 2017, 5(2), 102-112. doi: 10.11648/j.ijefm.20170502.14

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AMA Style

Philip Olawale Odewole. The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective. Int J Econ Finance Manag Sci. 2017;5(2):102-112. doi: 10.11648/j.ijefm.20170502.14

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@article{10.11648/j.ijefm.20170502.14,
  author = {Philip Olawale Odewole},
  title = {The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {5},
  number = {2},
  pages = {102-112},
  doi = {10.11648/j.ijefm.20170502.14},
  url = {https://doi.org/10.11648/j.ijefm.20170502.14},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20170502.14},
  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.},
 year = {2017}
}

Copy | Download

TY  - JOUR
T1  - The Controversy on the Implementation of the Contributory Pension Scheme (CPS) in Nigeria: The Accounting Perspective
AU  - Philip Olawale Odewole
Y1  - 2017/02/03
PY  - 2017
N1  - https://doi.org/10.11648/j.ijefm.20170502.14
DO  - 10.11648/j.ijefm.20170502.14
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 102
EP  - 112
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20170502.14
AB  - 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.
VL  - 5
IS  - 2
ER  -

Copy | Download