IMPACT OF BUDGET AND BUDGETARY CONTROL IN AN ORGANIZATION
- Project Research
- 1-5 Chapters
- Quantitative
- Chi-Square
- Abstract : Available
- Table of Content: Available
- Reference Style: APA
- Recommended for : Student Researchers
- NGN 5000
BACKGROUND OF THE STUDY
Budgeting control has been widely accepted as management techniques which are aimed at controlling the operations of an enterprise towards the realization of predetermined objectives. Organizations are structured into various departments according to individual requirement with specific targets set at each unit for the attainment of corporate objectives.
Budgeting control system is premised on co-ordinating and controlling various activities within the divisional levels such that the overall corporate goal is achieved. Budgeting is of age as the world itself, as it was used to check the kings power over taxation and to control government expenditure. The benefits of budgeting control is presently been used as an essential tool for planning the limited resources in any organization as well as the economy in general. Budgeting control though has received wide acceptance because of it’s crucial importance to government and organizations; it’s controversial nature can general conflicts, frustration and accurate competition from the core organizational resources (Umoren 1985:12). Budgeting is a good setting strategy where conflicts, power differentials and uncertainty are inherent, the system influenced behaviour and action positively and negatively, unfortunately, when control breakdown rather than seeking solutions, some executives are lamed yet others indulge in disclaiming responsibilities (Oliver 1975:125). Budgeting simply implies a political statement aimed at attaining certain economic and social welfare goal by the government or the agencies involved. Budgeting is a series of goals. A more inclusive definition of budget has been given as a plan quantified in monetary terms to be prepared and approved prior to a defined period of time usually showing planned income to be generated and expenditure to be incurred during that period and the capital to be employed to attain a given objective. Budgeting system encourages active concern for the future delegation of responsibilities, authority and influence in organization. There should be adequate organizational structure to form a foundation for a sound budgeting system. Management should maintain a level of authority and responsibilities, a good communication network, proper departmentalization and good relation. Management must however be contented with behaviour of customers, government agencies, trade unions, customs, economic climate and political, which are considered to be external influences. Budgeting system could assist the management in planning, co-ordinating, inter-relation activities and performance evaluation, planning as it is widely accepted in determination of objectives or setting targets, formulation of policies, strategies and alternative priorities. It involves critical examination and analysis of source and application of funds.
STATEMENT OF THE PROBLEM
Based on the purpose of the study, the problems under study can be seen in this context. Due to the dependence of Nigeria on revenue, a crisis in the world market will result to the following: A reduction of oil revenue which will cripple the economy and shatter National Development. Abandoning of capital projects or programmes due to insufficient fund in the economy. In-efficient allocation of limited resources to provide the right caliber of manpower and necessary infrastructure as basis for our national growth. The inability of the management to prepare a concise budget that will enable the organization to achieve its set goal and objective.
1.3 OBJECTIVE OF THE STUDY
Budgeting system in public and private sector of the economy is necessary. The major objective of this research work include among others the following:
- To know the necessity of budgeting control system in the public sector with particular emphasis on the budget office of Niger state, Minna.
- To access the role played by budget towards the controls of government fiscal policies.
STATEMENT OF HYPOTHESIS
This research work solely rest on assumption that
HI: the effective and proper implementation of a good budgetary control system in an organization is a determinant factor of the organization prospects.
HO: the effective and proper implementation of a good budgetary control system in an organization is not a determinant factor of the organization prospects.
SIGNIFICANCE OF THE STUDY
The significance of this research work cannot be over emphasized because it is inequitable in every organization. It will be appreciated by administrators of public utilities as its sets standard of performance which act as day to day guide time for the successful realization of the budget plan and the attainment of government objectives. It serves as a document of reference; the study is also relevant to all public and private sectors as financial resource these days are scare and limited, this budgeting control is inequitable because the limited funds available has to be judiciously utilized allocated and this can only be made possible through budgeting control.
1.6 SCOPE OF THE STUDY
For simplicity and easy analysis of data, the scope of this study is restricted to the budget office of Niger state Minna. It would have been an interesting academic exercise to cover other branches of the budget office within the country, but for easy analysis and data presentation, the researcher decided to restrict her study to Niger State budget office.
1.7 LIMITATIONS OF THE STUDY
The following are the basic limitations of the study:
SECRECY: some of the workers contacted were not only just unco-operative but were also non-approachable. Some of the vital information needed to give this project a better look was not easy to come across.
FINANCIAL CONSTRAINT: another factor that limits the wider coverage of this study is financial constraint as situation of things were not very pleasant at the time of this project work.
HIGH COST OF TRANSPORTATION: as at the time of this research work, there was an increase in the cost of transportation, so the researcher finds it difficult transporting from one place to another in search of research materials.
1.8 DEFINITION OF TERMS.
FISCAL POLICY: fiscal policy refers to that part of government policy concerning the raising of revenue through taxation and other means and deciding on the level and pattern of expenditure for the purpose of influencing economic activities. (Anyanwu T.C 1995).
DEFICIT: this can be defined as the excesses of depts. Over income or estimate revenue of budget. (Public finance in Nigeria by A.S Ilemobayo 1999).
RESOURCES: in its organizational context, it is defined as anything that could be thought of as a strength or weakness of a given firm including tangible and intangible assets (Wernerfelt, 1984:172)
PUBLIC EXPENDITURE: public expenditure is the expenses, recurrent or capital expenses, incurred by the government in the performance of government functions (Anyanwu 1979).
BUDGET: budget is a plan for financing an enterprise or government during a definite period, which is prepared and submitted by a responsible executive to a representative body (or other dully constituent agent) whose approval and authorization are necessary before the plan may be executed. (Fredrick A. Cleveland).
BUDGET EVALUATION: budget evaluation is a process that determines as systematically objectively as possible as the relevancies, efficiency, effectiveness, impact and sustained ability of activeness in the light of the budget.
POLICY: policy can be defined as “what the government choose to do” in response to a problem (Thomas Oye: 1984)
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