APPRAISAL OF ISSUE OF SHARES AS A SOURCE OF FINANCE IN PUBLIC LTD.  LIABILITY COMPANIES
(AN ANALYTICAL REVIEW OF FISRT BANK OF NIG. PLC.)
PROPOSAL
            Floating of shares is one of the permanent source of finance available to the public companies. A public company that desires to have its securities quoted in the Nigerian stock  exchange must meet the requirements and the legal procedures for the issue of shares.
            The researcher aim critically to find out why most of the companies are not quoted despite the objectives and decrease in the requirement, why shares of some companies quoted in the Nigerian stock exchange are not subscribed for, whether the legal procedures are adequate and still stringent and to find out whether the roles of the Nigerian stock exchange are adequate.
            To facilitate the objective, the researcher collected data from the research base and administered  questionnaire as well as conducted oral interview.
            In carrying out this project, work, the researcher is faced with certain limitations among which are time limit and finance limit.
            Having analyzed the data collected, it was found out that most companies do not quote the securities in the Nigerian stock exchange due to high cost of registration, stringent requirements, ignorant of the management, loosing control of the business and for the evasion of tax as less amount will be paid as tax because accurate financial position of the companies is not disclosed to the public.
            Furthermore, it was revealed that shares of companies which are not financially sound and profitable an whose business is illegal are not subscribed for even through they are quoted in the Nigerian stock exchange.
            However, the Nigerian stock exchange, still need to embark on extensive enlightenment. Company programme to educate the public and small indigenous companies who are ignorant.
TABLE OF CONTENT
Chapter one
1.0              Introduction
1.1       Statement of problem
1.2              Objective of the study
1.3              Significance of the study
1.4              Research hypothesis
1.5              Scope and limitation of study
1.6              Brief history of first bank of Nigeria
References
Chapter two
2.0              Review of related literature
2.1       Listing requirement
2.2              First  tier security market
2.3              Second tier security market
2.4              Rational for a second tier market
2.5              The rate of Nigeria stock exchange in respect  of issue of share and debenture
2.6              Operation of the stock exchange
2.7              Kinds of securities traded on
2.8              Share transfer
2.9              Accounting requirements
2.10          Problems associated with the issue and transfer of shares
References
Chapter three
3.0              Research methodology
3.1       Research design
1.2              Method of data collection
1.3              Population
1.4              Sample design
1.5              Method of data analysis and information
Chapter four
4.0              Data presentation and analysis
4.1       Analysis of data
4.2              Testing of hypothesis
4.3              Discussion of finding
Chapter five
5.0              Summary, conclusion and recommendation
5.1       Summary
5.2              Conclusion
5.3              Recommendation
Bibliography
Questionnaires
CHAPTER ONE
1.0              INTRODUCTION
There are various sources of finance available for companies. Companies can rise finance by borrowing from financial institution (i.e commercial banks), friends, relative or even suing personal savings.  Also finance can be raised by issue of shares.
A share is the interest of a shareholder in the company measured by a sum of money for the purpose of ability and interest.  The main types of shares are
-                      Ordinary shares (owner’s equity)
-                      Deferred or founders hares and
-                      Preference shares.
However, the companies act of 1968 do not allow all companies to issue shares.  Companies which issue shares are those quoted in the stock exchange.
Companies quoted in the stock exchange are those incorporate under the companies and allied matters decree 1990 (AMD) under co-operate affairs commission.
Furthermore, when a company had been incorporated, it proceeds with the task of raising fund or capital by issuing prospectus to the general investing public.
A prospectus is an invitation, circular, notice and advertisement to the public to subscribed or purchase any securities of a company.  The essence of the prospectus is to enable the investing public (prospective investor) have laid down detailed possible information about the affairs of the company they intend to invest in.  companies which are quoted in the stock exchange raised their fund through the issue of shares and they enjoy many benefits like limited liability companies but only few companies are quoted in the stock exchange.  The reason may be that management are ignorant of the benefit associated with the incorporation and that they are not enlightened or being adequately informed about the roles of the Nigerian stock exchange.
Also shares of some companies which are quoted are not subscribes for, it may be that the company has no sound financial base or that it is not profitable.
The high standard requirements provided by the cocmpanies act 1968 many also be the reason why companies are reluctant in quoting their shares in the stock exchange market.  Source of these requirements are that any company seeking quotation in the stock exchange market must have up to 500 share holders and paid up share capital of N600,000,
Moreover, securities market growth in Nigeria is handicapped mainly because of the  buy and keep attitude of the investors, lack of exposure and  awareness on the part of Nigerian public in respect of shareholding and then the indifferent attitude of indigenous companies towards the activities of the stock exchange.
1.1       STATEMENT OF THE PROBLEM
Issue of shares is one of the sources of finance available for companies.  Companies which are quoted  in the Nigerian stock exchange market issue shares to the public for the purpose of raising funds or finance.
1.                  Quotation or incorporation is open to every established companies, still only few companies are quoted in the Nigerian stock exchange.  This could be because the Nigerian stock exchange do not perform their role adequately or because the management are not adequately motivated or mobilized
2.                  Some companies shares which are quoted in the Nigerian stock exchange are not being subscribed for this might be due to insufficient financial base of the company.
3.                  companies which are not quoted in their companies in order to evade tax and their profit are use for the expansion of the business
4.                  Management are ignorant of the benefits of the incorporation and the role of the stock exchange.  They believe that quotation is for those that are financially buoyant and that huge amount will be paid for tax.
 Funds are raised by issue of shares yet few companies only raise funds through the issue of shares and many other complain of inadequate finance where as they  can quote their shares in thee Nigerian stock exchange market.
1.2 OBJECTIVE OF THE STUDY
the objectives of this research work are as follows:-
i.                    To find out why some companies in Nigerian stock exchange market to enjoy the benefits of limited liability.
ii.                  To find out why shares of some companies are not subscribed for while other  companies have over subscription.
iii.                To find out whether  the legal procedures for incorporations are adequate or stringent.
iv.                To notify whether the Nigerian stock exchange perform their functions adequately.
1.3 SIGNIFICANCE OF THE STUDY
The significance of the study is to make recommendation where appropriate to Nigerian stock exchange, public limited liability companies, general public and to provide basis for further investigation by future  generation.
1.4 RESEARCH HYPOTHESIS
for effective  conduct and understanding in this research work, some  research hypothesis have been formulated.
1.      NULL HYPOTHESIS [ HO]
The non –subscription  or  under-subscription of shares of some companies is due to insufficient financial base illegally of the business of the company and poor performance [ Non – profitability)
ALTERNATIVE HYPOTHESIS [HI ]
The non – subscription of share of some companies is  not due to insufficient financial base, non – profitability and illegality of the company.
2.      NULL HYPOTHESIS [ HO]
The Nigerian stock exchange perform their roles adequately to motivate the management.
ALTERNATIVE HYPOTHESIS [H1]
  The  Nigerian stock exchange do not perform their roles adequately to motivate the management.
3.      NULL HYPOTHESIS [ HO ]
Many companies in Nigerian are  not quoted due to the profit benefits of the company, ignorant of the management profit benefit of the company and high registration fee.
1.6 BRIEF HISTORY OF FIRST BANK OF NIGERIAN PLC
     The first bank of Nigeria plc was founded in 1894. By a shipping magnate from liver pool, sir Alfred Jones and it compared as a small bank in the office of Elder Dempster  and company  in Lagos.
            It was incorporated as a limited liability company in London on 31ST march 1984 with its head  office in liver pool under the corporate name of the bank for British west Africa. With a paid up capital of  30,000  pounds sterling. The bank started business after absorbing the African Banking corporation which was established earlier in 1892.
Over the year, the bank has experienced phenomenal growth, with shareholders fund of N99,000,000 in 19, and how it has it has risen to N11,307 in 1999.  The deposit base was N127, 230 million in March 31st 2000 against the total deposit of N84,531 million attained on 31st March 1999 i.e. 50.5% increase in growth. As at 31st March 2002 the capital base was 26.6.356 against 212, 901 in 2001 period (an increase of 25.11%)
The total deposit for the year ended 31st March 2002 was N168,175 billion in the 2001 (financial year.  The gross earning for the current year is N41,717 as against N29,098 ( an increase of 43.37%).
The profit before tax after provision for exceptional item of N10.694 billion was N5.087 billion as against N6.201 in 2003 when the bank began operation in 1894.  It had a staff of six comprising three Europeans and three Africans.  Its staff strength has increased to 7550 staff as at 31st March 2000 with 312 branches but as at today the staff strengthen to higher rate with 327 branches in Nigeria.
In 1957 at the even of Ghana’s and Nigerian’s independence, he bank changed its name to bank of west Africa.  It was incorporated locally in 1969 to become standard bank of Nigeria ltd.  This was in response to the distates of the company’s decree of 1968.  Further changes in the name of the bank were made in 1997 and 1991 to first bank of Nigeria plc respectively.
The federal government under its privatization programme disposed of its 44.8% equity in the bank through offer for sales to the public.  The issue were now fully owned by Nigerian citizens and associations.
Today first bank of Nigeria plc boasts of diversifies loan portfolio and credit facilities to various sectors of economy.  The bank’s rural baby any other bank while it’s agricultural credit facilities through community  farming loan scheme has given peasant farmers Tremendous access to needed bank credit.  It came first for 4 years at CBN former merit award as at 1994.
The bank is very much alert to it’s social responsibilities. It continues to identity with and contribute generously to worldly social philanthropic cultural, educational and sporting events.