An Analytical Study of the Purchase Accounting System at the Material Management Complex

Abstract

This study examines the effectiveness of the purchase accounting system at the Material Management Complex (MMC) of NLC India Limited (NLCIL), a Navaratna public sector enterprise engaged in mining and power generation. Purchase accounting plays a vital role in ensuring proper recording, verification, and control of procurement-related financial transactions. The study is based on primary data collected from 110 respondents through a structured questionnaire. Statistical tools such as percentage analysis, mean score analysis, and correlation analysis were applied using IBM SPSS Statistics. The findings reveal that efficient purchase accounting practices, including timely invoice processing, accurate ledger maintenance, and effective use of SAP ERP (FICO module), significantly contribute to financial accuracy and operational efficiency. The correlation results indicate a positive relationship between purchase accounting practices and financial performance. The study suggests enhancing automation, strengthening internal controls, and improving coordination between departments to ensure better transparency, compliance, and overall effectiveness of the purchase accounting system.