Download the complete accounting project topic and material (chapter 1-5) titled Budget and Budgetary Control as a Tool for Accountability in Government Parastatals (A Study of Remo-North Local Government) here on PROJECTS.ng. See below for the abstract, table of contents, list of figures, list of tables, list of appendices, list of abbreviations and chapter one. Click the DOWNLOAD NOW button to get the complete project work instantly.
The Project File Details
Nigeria is a country endowed with all kinds of resources; human, material, capital and others. However, in spite of her huge potentials, the country is still either believed to be a third world country or a developing one. A major tool government and firms uses for planning and control of their activities is budget. Horngren et al. (2008), define budget as a quantitative expression of a plan of action.
Atkinson et al. (1997), also define budget as a quantitative expression of the money inflows and outflows to determine whether a financial plan will meet organization goal. The definitions above do not mention the object of time to which a budget relates. A budget should always be in respect of a period of time, it could be half yearly, yearly, quarterly, monthly, weekly, daily, or other time periods (Harper, 1995; Frederick, 2001). A budget is also not just a quantitative expression of a plan of action but a quantitative economic plan. For a plan of action to be referred to as a budget it must be in economic term (Harper, 1995). The literature also posits that a budget is a quantitative expression of a plan of action prepared in advance of the budget period (Lucey, 2000). Lucey identifies that budgets may be prepared for the business as a whole, for departments or functions with a link with the overall objectives of an organization. The valuable use of budgets for translating organizational objectives to feasible plan of action is a major breakthrough against the ordinary use of budgets for cutting cost, restricting spending and allocating scarce resources.
In extant literatures, most people associate the word budget primarily with limitation on spending (Horngren et al., 2008; Theiss, 1935; Burkhead, 1947). For example, government often approves a spending budget and then maintains expenditure within the limit prescribed by the budgets (Ehrhart et al., 2006). In other word, budget was viewed as just a statement that shows the estimate of expenditure and possible revenue for future period. It is believed that as soon as budget proposals are approved or signed into law, a contract exists and nothing more. It becomes an authorization for spending and raising revenue.
There is a widespread belief that government can and should take actions designed to influence key economic variables such as inflation and unemployment. Experience has shown that daunting poverty and under-development has persisted in the face of tremendous national wealth and potentials (Ariyo, 1998 in Okpala, 2012). The need for a reduction in the rate of national unemployment and inflation becomes essential if economic development is desired, and we believe the government can do this with the budget as a fiscal policy tool. Oladipo and Akinbobola (2011) confirm our view when they asserted that government has greater influence on the nation’s economic activities through the operation of budgets. Budget as fiscal policy tool could be expansionary or contractionary depending on the desired macroeconomic objectives of the government.
Business organization as integral part of the broad national economy cannot be left out in a bid of achieving macroeconomic objectives as its activities contribute immensely to economic development. It is therefore, very essential for business organizations to carefully forecast and plan for the policy to pursue over a defined period, coordinate its functions and control performance and cost in such a manner that any deviations from plan, corrective action may be taken without delay. The best tool for effective planning and control of business activities is the budget.
Budgeting system is the process involved in using the scarce resources to achieve the desired goals and objectives of the corporation (Ikpe and Oba, 2004:66).
Budget is also seen as a financial or quantity statement prepared and approved prior to a defined period for the process of attaining a given goal or objectives. It may include income, expenditure and employment of capital (ICMA; 2008).
Therefore in order to achieve these objectives, the organization must deploy the economic resources and discover the means of achieving these goals. These goals can only be realized when the properly planned use of available resources are controlled and coordinated effectively. Thus, the system of managing a business by making a forecast of different activities imperative. These forecasts are guided by the formulation and adoption of planned systems such as techniques in budgeting variance analysis etc. Budgets may be prepared for the firm as whole or smaller units like departments, operations like production and sales, financial and resource items like personnel, purchase, cash and capital expenditure etc.
Budgetary control at same time is a system of controlling cost through the preparation of budget coordinating departments, establishing responsibilities, relating the responsibilities of the executives to the requirements of a policy. It entails comparism of actual performance with the budgeted and ensuring that the remedial actions are taken promptly to achieve organizational objectives.
It is therefore germane to say that the level of importance that is attached to these plan and effort made in controlling the variance differ in organizations once goals are set which must be based on the detailed analysis of feasibility within the content of political and social values and the financial plans will be enable to strive towards its attainment. Often than not when these plans are put into operation, condition prevails which tends to cause deviation to the plan and corrective controls and measures are always taken to steer the business back on the right track.
The process already mentioned as it is applied entails budgets and its control. And to lend credence to goal congruence, suitable techniques should be applied to specific areas needs. Special attention, hence the measurement of budgeted with actual to arrive at variance cannot be over emphasis. A business is said to be on the right track; if the outcome of budgeted estimates is favourable as against the actual.
The success of any business organization rest upon its ability to adopt a well organized budgeting and budgetary control system. Lack of budgeting system in planning and controlling has resulted in indiscriminate spending of scarce funds meant for use in viable projects and activities. The results in many problems for many organizations which include;
The major focus of this study is to examine budget and budgetary control as a tool for accountability in government parastatals. Accordingly, among other reasons, the objectives of this study include the following:
The research is so useful in several ways:
Firstly, the government will benefit immensely from the findings and recommendations. This study will highlight the problems associated with inadequate budgetary control in government business. It will also help government on how they will effect controls in their businesses.
Secondly, corporate organizations will utilize the recommendations to effect proper budgetary control is all their affairs to ensure accountability in all its businesses.
Thirdly, the society will benefit because accountability will eradicate corruption. This will ensure that all projects and activities budgeted for are completed and on the specified periods to their benefit.
Finally, this project study will be useful for academic purposes. It will act as a data bank to those who will carry out further study on the field in the future.
The hypotheses for the study are stated here and they are stated in null forms
Hi: There is relationship between budgetary implementation and their actual performance.
Hi: Budgetary control as a management tool contributes to efficiency and effectiveness of management productivity.
Hi: Budgetary control can be used in assessing management budgeting accountability.
The population of this study is large, but due to certain factors such as time, financial, and academic constraint, this research work will concentrate only on the staff of Remo Local Government.
Government: The obligation of an individual or organization to account for its activities, accept responsibility for them, and to disclose the results in a transparent manner. It also includes the responsibility for money or other entrusted property.
Budget: An estimate of costs, revenues, and resources over a specified period, reflecting a reading of future financial conditions and goals.
Budgetary control: Budgetary control refers to how well managers utilize budgets to monitor and control costs and operations in a given accounting period.
Expenditure: Payment of cash or cash-equivalent for goods or services, or a charge against available funds in settlement of an obligation as evidenced by an invoice, receipt, voucher, or other such document.
Firms: A firm is a business organization, such as a corporation, limited liability company or partnership, that sells goods or services to make a profit.
Fiscal policy: Fiscal policy is the government spending and taxation that influences the economy.
Goals: A goal is an idea of the future or desired result that a person or a group of people envisions, plans and commits to achieve.
Government: It sets and administers public policy and exercises executive, political and sovereign power through customs, institutions, and laws within a state.
Income: Income is money that an individual or business receives in exchange for providing a good or service or through investing capital.
Management: Management is the process of reaching organizational goals by working with and through people and other organizational resources.
All project works, files and documents posted on this website, projects.ng are the property/copyright of their respective owners. They are for research reference/guidance purposes only and the works are crowd-sourced. Please don’t submit someone’s work as your own to avoid plagiarism and its consequences. Use it as a guidance purpose only and not copy the work word for word (verbatim). Projects.ng is a repository of research works just like academia.edu, researchgate.net, scribd.com, docsity.com, coursehero and many other platforms where users upload works. The paid subscription on projects.ng is a means by which the website is maintained to support Open Education. If you see your work posted here, and you want it to be removed/credited, please call us on +2348159154070 or send us a mail together with the web address link to the work, to [email protected] We will reply to and honor every request. Please notice it may take up to 24 – 48 hours to process your request.