TABLE OF CONTENT

Title Page                                                                 

Certification                                                       

Dedication                                                

Acknowledgement                                     

Table of Content                                        

CHAPTER ONE

INTRODUCTION                                          

1.1    Historical background of the case study                 

1.2    Statement of the Problem                                   

1.3    Objective of the Study                                           

1.4    Research Question                                               

1.5    Significance of the Study                                    

1.6    Scope of the Study                                            

1.7    Limitation of the Study                               

1.8    Plan of the Study       

1.9    Definition of Terms

CHAPTER TWO

LITERATURE REVIEW                                         

2.1    Introduction                                                      

2.2    Conceptual Framework of Ratio Analysis                 

2.3    Approaches to Use of Ratios                        

2.4    Classification or Types of Ratios                   

2.4.1 Liquidity Ratio                                                    

2.4.2 Leverage Ratios                                         

2.4.3         Activity Ratios                                                    

2.4.4         Probability Ratio                                          

2.5    Place of Ratio Analysis in an Organization or Financial Institution             

2.6    Expected role of managers in relation to ratio analysis    

• Contributions of Investors to Administrative Performance in Terms of Financial ratio Analysis      

2.8    Contribution of Ratio Analysis in Decision Making in an Organization                                

CHAPTER THREE

RESEARCH METHODOLOGY                        

Introduction                                                      

3.2    Population Size                                          

3.2    Source of Data                                          

3.3.1         Primary source                                          

3.3.2 Secondary source                                      

3.4    Research Instrument                         

3.5    Data Analysis Procedure                                       

CHAPTER FOUR

DATA PRESENTATION; ANALYSIS AND INTERPRETATION

4.1    Introduction                                                      

4.2    Data Presentation and Analysis                     

4.3    Computation of some selected ratio using the

        United Bank for Africa (U.B.A) Statement of Account as Below Balance Sheet as at Decembers 31^st 2011.                                   

4.4    Summary of Findings                                           

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATION

5.1    Summary                                                            

5.2    Conclusion                                                        

5.3    Recommendation                                               

BIBLIOGRAPHY                                          

APPENDIX I                                                       QUESTIONNAIRE       

CHAPTER ONE

1.0   INTRODUCTION

          In every organizing irrespective of its size, ownership, structure, impact of ration analysis on management decision making occupy a  crucial position.

          However, given this centrality, it can be said that behind every successful organization, the process in which the management arrive at decision making is very important as far as financial management is concerned in the private sector of the economy and specially in a banking institution like united bank for Africa (U.B.A)

In a nutshell, the impact of ration analysis on management decision making which is the most preoccupation of this research work is referred to the manner through which the management of organization takes decision suitable for profit as possible, future planning, controlling current performance and future development through liquidity analysis, leverage analysis and activity analysis.

Significance change has taken place in recent years in the size and complexity of both private organization and public organization because of this management is faced with evaluation in technical, social political and economic forces. As a result, the methods of arriving at the decision as become more difficult to management especially in accounting activity of the organization.

This research is devoted to examination of some major impact of ratio analysis in financial institution (united bank of African).

1.2   HISTORICAL BACKGROUND OF THE CASE STUDY

Today’s united for African Plc (U.B.A) is the product of the merger of Nigeria  third  and fifth largest banks, namely the old UBA and erstwhile standard trust bank Plc (STB) respective and subsequent acquisition of erstwhile continental bank limited (CTB).

          The union emerged as the first corporate combination in the history of Nigeria banking.

United back for African history dates back to the founding of old UBA in 1961, and erstwhile STB and CTB both in 1990 although today’s’ UBA emerged a time of industry consolidation induced by regulation, the consolidated UBA was borne out of desire to lead domestic sector to a new era of global relevance by champion the creation of the Nigeria consumer. Finance market leading a private public sector partnership at supporting the acceleration of Nigeria economic development, and growing the institution while spreading its footprints across African to earn the reputation as the face of banking in the continent. Today the consolidated is the largest financial services institution West African with a balance sheet size in excess one trillion naira (under USD eight billion) and more six million customer account operating out of the two most vibrant economics in the sub region Nigeria and Ghana. It as over six hundred and thirty (630) retail distribution centers across Nigeria, its main operation base, and 8 branches in Ghana, outside Africa, it also has presence in New York and Cayman.

United bank for African (UBA) Ilorin main branch has the total staff strength of 44 staffs, of which 6 the senior staff, while 35 are junior staff. The bank is made up of 3 units which are the marketing unit is headed by various persons such as the branch manager. Branch operational manager and auditor.

1.2   STATEMENT OF THE PROBLEM

The part of ratio analysis as a tool for decision making have the following area of concern. 75 ratio analysis useful in investment appraisal?

1. Whether management relies on ration analysis for decision making?
2. Do ration analysis really determine the wealth maximization of shareholder? Or
3. It ratio analysis or management tool or technique use in determining the liquidity, stability profitability and efficiency of the organization?
4. Whether ratio analysis can be used to ascertain the strength, weakness, opportunity and treat of the organization.
5. Whether ration analysis can be used to determine the trend of development and performance of the organization over time.

At the time of chooses this topic the above was what the researcher have in mind and therefore pushes to fine out what is the need for  ratio analysis in banking institution like UNITED BANK FOR AFRICA

1.3   OBJECTIVE OF THE STUDY  

The primary objective of this researcher is to fine out how efficient and effectively does the management evaluate its financial position. Also the performance of the institution with regards to the financial analysis or ration analysis in making a quantitative judgment about the institution financial position and its achievement which include. It is further generalized as the following:

1. The effective implementation of the traditional function of banking acceptance of deposit to find lending.
   1. Efficient financial resource mobilization without inflationary money supply expansion for economic development especially when external borrowing is viewed as a last resort.
   1. increasing sense of; commitment and identification with the institutional and it’s good by institution a design and activities of people and adopting a participating or democratic style of management
   1. Maintaining accountability of assets.

1.4   RESEARCH QUESTION

For the purpose of this study, the following question is raised to enable the researcher find possible solution to the identified problem if properly answered.

1. How is the application of ratio analysis useful when it comes to decision making in the organization?
2. In what way is the application of ratio analysis useful in evaluating the financial performance of the organization?
3. How do interested parties in united bank for African apply and use ratio analysis in evaluating the bank before taking their decision?
4. How is ratio analysis of importance when it comes to granting of loan and advances to customer?
5. To what extent does ratio analysis help the chief executive of the back in decision making?
6. How is ratio analysis of importance to the balance sheet of the bank

1.5   SIGNIFICANCE OF THE STUDY

The significance of impact of ratio analysis in financial institution cannot be over emphasized. It is therefore expected that, this research work is bound to be beneficial to the following;

1. Management; most management decision are based on information from ratio analysis. Management planning is also supported by vital information from ratio analysis.
   1.  Shareholders; for shareholders to deter mine their wealth maximization, they rely on information from ratio analysis such as stability ratio and leverage ratio.
   1.   Potential investors; for potential investors to embark on investment in an organization, the need to know how reliable the organization is and for them to know or ascertain the viability of the organization is based on vital information from ration analysis.
   1. Employees; the interest of employees in the organization is on how their welfare can be improved. They are able to obtain information for the agitation for improvement on their welfare through ratio analysis such as profitability ratio.
   1.    Students; it is expected that students mostly undergraduates stand to benefit from this research work because it will serve as a source of ratio analysis.
   1.   Government; government also rely on information from ratio analysis in the assessment of the organization for tax purpose such as profitability and liquidity ratios

1.6   SCOPE OF THE STUDY

The scope of this research work will be specially restricted to UNITED BANK FOR AFRICA PLC ILORIN branch; with regards to its accounting ratio which will help in;

1. The assessment of profitability
   1. Assessment of liquidity
   1. Assessment of activity
   1. Assessment of failure

1.7   LIMITATION OF THE STUDY

          In search of data, problems were faced by the researcher despite all the explanation of the purpose of the study

1. In the first place respondent did not react to the question sent to them this lead to insufficient data.
2. Also cost and time lad a great impact on the study since no adequate means were available and time under consideration was short.

1.8 PLAN OF THE STUDY

        This Research work consist of five chapters chapter one of this research work is made up of the introduction, the statement of the study, the objectives of the study, the significance of the study, the limitation of the study, the definition of terms and the plan of the study.

Chapter two of this research work is the literature review.

Chapter three of this research work also includes research methodology.

Chapter four consist five of this research work includes summary, conclusion and recommendation.

1.9 DEFINITION OF TERMS

The terminologies used in this study are defined below for the better understanding of this work so that research will not to be misinterpreted.

i.        BANK; it a financial institution which primary holds out itself to accept deposits from consumers and payout on demands.

ii.       RATIO ANALYSIS; refer to the determination of the significant relationship which exist between figures as show in a firms performance.

iii.      PROFITABILITY; these measures indicate whether the company is performing satisfactorily. They are used among other things, to measure the performance of management to identify whether a company may be a worth while investment opportunity and to determine a company’s performance relative of it’s competitors.

iv.      MANAGEMENT; management can be describe as the art of working particularly through people, for the achievement of the broad goals of an organization.

v.       LIQUIDITY: liquidity measure the ability of a business to meet short term obligation.

vi.      ACTIVITY; help assess the efficiency of managers actions.

vii.     RETURN ON CAPITAL EMPLOYED: this is the yardstick employed to measure the efficiency of the management in utilizing the assets of the business.