FACULTY OF MANAGEMENT SCIENCES,
UNIVERSITY OF ADO-EKITI
ISSN 0794-2877

Editor-ih-chief
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Manager Editor
O.I. AWE
Associate Editor
Mrs. A.R Agbaje
F.A.O Osekita
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Prof.R.O Anao
Prof. I.I. Ihimodu
Prof. l Oribabor
Prof. D.C Uguru okorie
Dr M.L. Nassar
Dr. A.A Owojori
Dr. J.A OIoyede
Dr. J.A Olaogun
Dr. J.O Olujide
Dr. S.A Adebola
Dr. S.O Olatunji
Business Manager:
Mr. Oluwakayode
Mr. O. Aduwo
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A PUBLICATION OF THE DEPARTMENT OF ACCOUNTING, FACULTY OF MANAGEMENT
SCIENCES, UNIVERSITY OF ADO EKITI, NIGERIA.

Contents
Service Costing Model: A Yardstick For Measuring Performance Of Transport Operations
- Dr H T Iwarere……………………………………………………
Nigeria's Debt Overhang, (1960 - 2004), An Analytical Revisit
- Dr. S. A. Adebola ………………………………………………...
1
11
Entrepreneurs As Agents Of Small Business Development
- O. I. Awe & A. R. Agbaje (Mrs .)…………………………………. 21
Building Human Capital For Community Banks In Kogi State, Nigeria.
- Dr J. Olujide & A. D. Dada ……………………………………..
Gender Bias And The Financing Of Entrepreneurial Ventures: How Nigerian Banks
28
Perceive Men, Women And Successful Entrepreneurs
- Dr. (Mrs.) S. L. Adeyemi …………………………………………
Contemporary Technical And Practical Issues In Tax Audit And Investigation In Nigeria
- Dr. A. A. Owojori ………………………………………………….
38
49
Optimizing Financial Decisions In Professional Accounting Firms: The Goal Programming
Modelling Approach I. R. Akintoye …………………………………………………….. 63
Ajaokuta Steel Plant And Nigeria Liquefied Natural Gas Projects: A Comparative Analysis
- Dr. H.T. Iwarere & G.T. Akinleye ………………………………. 74
The Effect Of Dividend Policy On The Market Price Of Shares In Nigeria: Case Study Of
Fifteen Quoted Companies Dr. J.J. Adefila, Dr J. A. Oladipo, &. J.O Adeoti ……………… 82
Relationship In Relationship Marketing: A Definitional Review.
- K. Olorunleke ………………………………………………………... 92
Evaluating The Usage Of Process Cost Accounting In Nigerian Manufacturing Industry.
- S. Fatokin & Y. Akinkoye …………………………………………… 99
A Short-Term Linear Programming Approach To Portfolio Management In Nigerian
Banking Industry. A Case Study Of Trade Bank Nigeria Plc., llorin
- Dr. J.A. Adeoti, A. Salami, & T.O. Fakokunde …………………… 105
Auditor's Liability To Third Parties In Nigeria
- O.I. Awe …………………………………………………………….. 117
An Historical Survey Of Nigeria's Economic Development From 1960- 80
- S.O. Soetan ………………………………………………………… 123
Does Stock Market Promote Economic Growth In Nigeria?
- B.O.Oke & S.B.Adedeji
…………………………………………… 129

UNAD International JOURNAL OF accounting 28
BUILDING HUMAN CAPITAL FOR COMMUNITY BANKS IN
KOGI STATE, NIGERIA.
By
DR J. OLUJIDE
Department of Business Administration, University of llorin
&
A.D. DADA
Department of Business Administration university of llorin.
Abstract
The poor performance of community banks in Nigeria and the high rate of mortality experienced in that sub-sector have become worrisome. This paper examined the contribution of poor quality human capital to these phenomenon finding revealed that community bank staff has recruitment and selection are not competitive, remuneration is poor and opportunities for training and development are lacking.
Introduction
Before 1990, there were no formal institutions to mobilize rural savings and use same for the financing of investment activities/programmes in the rural areas in Nigeria. Consequently, resources in the rural areas remain largely underutilized, hence the apparent lack of socioeconomic growth and serious underdevelopment. In order to reverse this trend, the federal government of Nigeria thought that the monetization of the rural economy with a view to integrating them into the mainstream of the national economic system would be one of the rewarding approaches. Thus, one of the policy thrusts to open the rural areas culminated to the national programme for rural banking and community banking. The rural areas remain largely under-banked and insufficiently monetized. To overcome this problem, there was the need for a set of banks that can successfully operate within the peculiarities of rural communities, different from the conventional commercial, merchant as well as development banks that are more urban based. This situation informed the introduction of unit/community banking system in 1990. This shift in emphasis to grass root development has become a matter of necessity and in effect it has become imperative for government to lift-up the rural low-income segment of the Nigerian society if it is to undergo true economic transformation.
The response of rural communities to this government initiative was overwhelming because barely two years after commissioning the first community bank, over eight hundred and eighty
(880) community banks had been established in 1993.
Today, it is disturbing however, that a sizable number of this community banks have failed to live up to expectation as some of them have gone distressed. The mortality rate continues to increase. For instance, out of the 1,046 Community Banks that had commenced operations as at
1995, only 700 of them are left after the former NBCB (National Board for Community Banks) sacked 346 of them (Business Times April 2003).
In his study on the performance appraisal of community banks in Kwara State, Nigeria, Jenyo
(2002), observed that 30 percent of the established Community Banks failed as a

DR J. OLUJIDE & A. D. DADA 29 result of distress. Amongst the reasons adduced for the high morality rate in Community Banks is poor quality human resources.
The role of human resources in achieving organizational objectives cannot be over emphasized.
In fact, the ability of any, organization like the community banks to execute its strategy and achieve its goal depends on whether it can organize, develop and manage its human resources effectively. It is in the recognition of this fact that Carlson et al (1994) opined that any organization that aspires to a positive change or improved quality in service delivery would, as a matter of necessity, strive to acquire quality human resources. It is the human capital that dictates the quality of service and the overall performance of such organization. It is the human resource that organizes and manages all other resources of the organization. It Odd mines the appropriate quantity, quality and mix of other resources. Hence, any organization that fails to give the required attention to its human resource is doomed to fail. This is because, the ability of any organization like the community bank to face the challenges of modern technology and competition in the market place calls for a resourceful human capital. Thus it is in the light of the foregoing that this study is conceived and designed to examine the development of human capital in Nigeria's community banks.
Objectives of the Study
Community Banks, have objectives which include, among others, the monetization of the rural economy and the mobilization of rural savings. However, these objectives would be difficult to achieve in the absence of a virile, responsive and quality manpower. This is particularly so with community banks facing daunting challenges in Nigeria's volatile economic landscape and market environment. Of particular reference is the stiff competition they have to contend with, especially from the more established and experienced commercial banks t hat a re pursuing aggressive banking programme. Thus, community banks not only need quality human resource, this must be in the right quality and in the right mix.
Although past studies have identified poor quality manpower as one of the causes of the observed poor performance in community banks, only the profile of the community banks staff
(which includes academic background and work-experience) were addressed (Jenyo 2002). How the staff are sourced, remunerated, trained and/or developed have not been addressed. All the above variables among others are essential and key factors in building human resource in an organization. Thus, the objectives of this paper include:
1. To examine the staff profile of community banks in Okunland, Kogi State;
2. Investigate the recruitment and selection procedure in community banks;
3. Examine the training/development programme in community banks, and;
4. Investigate the remuneration system in community banks.
Literature Review
The term 'human capital' is used to describe individuals because of the role they assume in the organization. People in work organizations have different abilities, they influence productivity, quality and product/service profitability. It is the people that set overall organizational strategies and goals, design work systems, produce goods and services, monitor product quality, and are responsible for the allocation of scarce resources among the various competing needs of the organization (Bratton, 1999).
Harbison and Nylers (1964) and Jhingan (1985) refer to human capital development as the process of acquiring and increasing the number of people who have the skills, education

and experience which are critical for the economic and the political development of a country.
Maire (1970) citing Schultz reiterated that there are three ways human capital can be developed.
(i)
UNAD International JOURNAL OF accounting 30
(ii)
Through health care facilities and services, broadly conceived to include to include all expenditure that affect the life expectancy, strength and stamina and the vigour and vitality of the people.
On-the-job training, including old style apprenticeship organized by firms,
(iii) Formally organized education at the elementary secondary and higher levels.
In its wider sense therefore, building human capital means all efforts geared toward improving the health, education and social services in general, and in its narrower sense, it implies improving people through education and training.
Key System in Human Resources Building
Some factors have been discovered by experts to be critical to building human resources in organizations. Me Naughton et al (1994) observed that the starting point in human resource building is Organizational Structuring Organizational structure should be designed specifically to carry out the bank's mission and strategies. This structure, according to these experts, will define the bank's manpower needs in the effective terms the number and level of most employees and skills they require to operate the bank successfully.
Among the organizational problems discovered among banks in developing countries by Carlson
(1994) include:
(i)
(ii)
An insufficient focus on specific market of customer service.
A diffused leadership structure more suited to a social organization than to a business.
(iii)
(iv)
(v)
Undefined responsibilities of units or individual responsibilities .or results.
The absence of critical functions-planning, credit policy and supervision, management information, marketing etc.
Fragmentation of important functions into two or more independent units, and the overlap
(vi) of some other functions,
Outdated or inappropriate authority levels in many cases, too low to operate efficiently, or too high for prudent control.
Employees Training and Development
Training and development represent significant if not the pivot components in building an effective human capital in an organization like the community bank.
A research carried out by Carlson et al (1994) on banks in developing countries reveal that many banks have a severely under resourced training and development infrastructure and that skill shortages are still one of their most serious obstacles to improving banking performance. Both the management and staff have poor attitude to training - trainees do not take the training seriously, managers are unwilling to release staff for training and trainers cannot be attracted to the function.
On-the-job development was recommended to supplement training as most learning in a bank occurs on the job. "Despite nothing can impact a wide range of basic skills and desired attitudes, it is on-the-job development that these skills are internalized, deepened, honed and supplemented". Hence, training and development must be a core activity of a bank that wants to build an effective human capital.

DR J. OLUJIDE & A. D. DADA 31
Recruitment and Selection
Recruitment is the process of searching for prospective employees and stimulating them to apply for jobs in an organization Fiippo (1984). It is the process by which an organization solicits, contacts and interests potential appointees, and then establish whether it would be appropriate to appoint any of them Watson (1994).
Carlson et al (1994) in their study of banking institutions in developing markets emphasized capability - based recruitment and selection. External recruitment according to them provides a unique opportunity to improve on the quality of the work force.
Internal training and development will only improve the skills and attitudes of the existing work force, their capacity, but their natural ability does not change. They therefore suggested that the external recruitment must be given priority if the quality of the work force must be improved.
Banks, in addition to unsolicited applications are expected to widen their sources of recruitment to include a wide range of schools and organizations.
In selection process, two statistical concepts have been found useful. These are: Reliability and
Validity. While reliability refers to the extent to which a selection technique achieves consistency in what it is measuring over repeated use, validity measures the extent to which a selection technique measures what it sets out to measure, Bratton and Gold {1999}. These concepts should serve as a guidepost in the selection process.
Reward Management
Reward is all forms of financial returns and tangible services and benefits employees receive as part of an employment relationship, Bratton and Gold{1999}. This debunks the erroneous belief by some people who take promotion to be the most important form of reward. Other forms of reward include awards, prizes, letters of commendation, training, particularly overseas training, e.t.c. Carlson et al{1994}.
Many banks in the developing countries pattern their reward programmes after those of government, that is, the public sector, despite these banks may have fundamentally different needs in attracting, retaining, and motivating employees. Other reasons for a review of reward programmes according to Mcnoughton {1994} include:-{I} The historic job and pay hierarchies that used to be in operation in the past may no longer reflect the relative importance of the jobs in the bank today; fii} Some banks operate paternalistic programme that reward getting married and having children more highly than achieving good performance. Many of these banks will face the problem of attracting high- caliber entry- level employees and find it almost impossible to attract experienced persons with critical technical skills.
The satisfactory management of employment requires proper management of reward
{remuneration} as a necessary, if not a sufficient condition, Brown {1998}. Other human resource elements have also been found to be directly related to reward management. In the recruitment and selection process, remuneration can be a major factor in attracting highly qualified and competent people. It can also facilitate a reduction in the turn - over ratio. Pay also influences an employee's development and career plan. Performance-related pay can motivate an employee to undertake a course or a training programme, Bratton and Gold {1999}.

UNAD International JOURNAL OF accounting 32
Methodology
This study covers the seven operational community banks in Okun land of Kogi State of Nigeria.
The choice of this area is predicated on the following reasons:
Okunland is one of the three major ethnic stocks in Kogi State constituting 13% of its population of 2,099,042 people according to 1991 census figure. The area is made up of five local governments namely: Kabba-Bunu, ljumu, Mopa-Muro, East Yagba and West Yagba. The area has a number of industrial, educational, and administrative concerns that can support the establishment of CBs in terms of patronage and other human and material resources.
The strategic location of Okun land gives the area a picture of what operates in Nigeria:-sharing boundaries with both the northern and southern parts of the country, and more importantly the willingness of these institutions to participate in the research work ensured that access to vital information was not impaired.
The study population consisted of all the sixty-two staff of the seven operational community banks in Okunland of Kogi State. The researcher chose to cover the entire staff because the number was considered manageable and would enhance the representativeness of the study population and hence, useful for generalization purposes.
The data used for the study were collected by means of a 20-item questionnaire designed as follows:-
Section A - contained 8 items of which a combination of nominal and ordinal scales was used in measuring the profile of community banks' staff.
Section B - contained 12 items measured, using a 5- point Likert scale. This was designed to measure the opinion of respondents about some of the human resource variables under investigation. These are: recruitment/selection, remuneration, training and development.
The Likert scale of measurement was opted for, because it allowed for greater discrimination of the intensity of respondents' belief regarding an issue. Eventually, 57 of the 62 copies of the research instrument administered representing a 92% collection rate were used for the study. The techniques employed in analyzing the data collected were the frequency distribution and cross tabulation.
Analysis and Results
General characteristics of respondents:
Results-show that 68.4% of our respondents are male while 31.6% are female; 66.7% are married, 31.55% single and 1.8% widowed.
The frequency distribution analysis further reveals that 33.3% of respondents are between 21-30 years of age, 45.6% between 31-40 years, while 3.5% are over 50 years of age.
It is note-worthy that majority, (95.5%) of our respondents are between 21 and 50 years of age.
This age bracket represents the active age when workers are capable of learning and amenable to training and development for improved performance at the workplace. Thus, the community banks are blessed with a workforce that can be improved or developed.
With regard to the educational/professional backgrounds of respondents, our results show that
1.8% of the respondents have primary education only, 4 7.4% possess W ASC/GCE O'L/Grade II,
12.3% ND, NCE A'L, 38.6% have either HND/First degree while none has post graduate training, see table 1.

DR J. OLUJIDE & A. D. DADA
Table I: Educational/Professional Background of Respondents
33
With regard to number of years of cognate banking experience possessed by respondents, results in Table II show that 91.2% have less than 5 years bankir,-; experience, 5.3% have between 5 and 9 years while 3.5% have between 10-14 years. The results show that majority of our respondents have little or no banking experience before they joined their banks.
Table II: Banking Experience of Respondents Before Joining CBs
Results of our analysis on the human resource elements investigated in the study reveal the following:
On recruitment and selection, 12.2% of the respondents were recruited through local advertisement though not in mass media and therefore not competitive, 47.4% through casual or unsolicited application, 36.8% through their relatives and 1.8% through other means not specified.
With regard to the process of seleuii. .1, 75.4% indicated they went through the interview process,
21.1% through reference checks, 3.5% by qualifying test, while no respondent went through physical examination, induction or orientation. It appears majority of the respondents were only invited for an interview and then offered an appointment if successful.
With regard to the factors respondents considered influential to their final selection, 36.8% pointed at their educational backgrounds, 24.6% mentors, 21% catchment area and 17.5%, job experience.
Results on the training and development programmes of the community banks under study reveal that 78.9% of the respondents have never attended any form of training or development programme, see Table III.

UNAD International JOURNAL OF accounting
Table III: Attendance at Training/Development programmes By Respondents
34
With regard to remuneration, 42% expressed their satisfaction with their pay packet while 56.1% were not satisfied. In support of the opinion expressed above, 52% felt that remuneration in their banks were not satisfactory enough to attract quality manpower (Table IV).
Table IV: Summary of Frequency Distribution Relating to Remuneration
Discussion
Our findings show that majority of community banks staff have poor or inappropriate academic or professional backgrounds. Most of the first degree and HND holders qualified in disciplines not related to banking, and none of them possessed any relevant professional qualifications. Those who specified their disciplines mentioned such field of study as education, natural and applied sciences (chemistry, food technology) etc. Relevant academic/professional areas in banking should include disciplines such as banking/finance, economics, accounting, business administration, chartered institute of bankers (CIS) etc. These areas of study are good measuring yardsticks for quality human resource in the banking sector. From the foregoing therefore, a reasonable percentage of appointment is not skill-based.
In a similar vein, the results revealed that majority of our respondents have no experience in banking..
The results on the demographic characteristics lend support to past studies carried out by (GIB
1999) which observed that 80% of community banks staff have less than eleven years bankigg experience. Experience on the job is a necessary condition for performance and yardstick for measuring manpower quality in any organization like community banks. Thus, most of these employments are not capability based.

DR. J. OLUJIDE & A. D. DADA 35
Further analysis shows that recruition and selection into CBs are not competitive enough to attract high caliber staff. Criteria, such as, catchments area and other unorthodox methods are employed in the employment of staff.
The study has also revealed that majority of our respondents 'have never attended any form of training or development programme. This is with the exception of a few top officers, mostly managers, who do attend one form of training or the other once in two years. This lends support to Carlson et al (1994) who observed that most banks in developing ' countries have a severely under resourced training and development infrastructure and that skill shortages are still one of the most serious obstacles to improving performance.
Considering the inappropriate academic and professional backgrounds of the respondents, community banks cannot afford not to take training and development programme seriously.
Findings of this study have also revealed that majority of the respondents who are not satisfied with their remuneration are those with high academic qualifications. Incidentally, these are employees that can enhance the quality of the human resource in organizations like the community banks.
Most community banks are not paying competitive salaries, while some pattern their reward system after the public sector (government) wage system, poor still, some would not pay the required government minimum wage; and in the words of Carlson et al, these banks have fundamentally different needs in attracting, retaining and motivating employees. A non-motivating reward system would increase labour turn-over and hence poor quality human resource as the case is presently in community banks in Nigeria.
Conclusion
This paper has given us an insight into why most of our community banks lack quality manpower.
The study shows that demographic characteristics of community banks' staff play a role in the observed poor quality of human resource. Most of the staff of the community banks have inappropriate academic or professional backgrounds and they have little or no banking experience. Therefore, they are poorly skilled.
Other factors responsible for the observed poor manpower quality include uncompetitive recruitment and selection procedure, which has not helped in exposing the banks to quality manpower. Poor or lack of training/programme for their staff despite the fact that majority of them are highly trainable.
In addition, the reward system is also found to be non-competitive enough to attract quality manpower.
It is concluded, based on the above therefore, that ability of the community banks to pursue a recruitment and selection policy based on skill and capability is one of the major factors responsible for poor quality human resource and performance.
The above indicated that a lot need to be done by the management and all stake holders in community banks to address the issue of poor human capital. This will help improve their performance and reduce the high rate of mortality currently experienced.

UNAD International JOURNAL OF accounting 36
Policy Recommendations
Based on the findings of this study, the following policy recommendations are made.
1. Recruitment and selection into community banks should be made more competitive through open advertisement, so that high quality manpower outside the immediate locality can be attracted. Qualifying tests, preliminary interviews, physical examination, and importantly, induction or orientation courses should be part of the selection process.
2. In the same vein, cognate experience and appropriate educational/professional background of applicants should be given priority attention in the recruitment/selection process. This will ensure that applicants, when employed would be more amenable to training than applicants who are less qualified.
3. Regular training and development programmes should be organized for all categories of employees. Such training programmes should be relevant to the duties of the employees.
These will enhance the skill and capability of employees.
4. Remuneration system in terms of salaries and other pecuniary and non-pecuniary rewards in community banks should be made more competitive. This would help to attract qualified applicants and retain the best hands currently in their employment.
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