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PROJECT TOPIC AND MATERIAL ON BUDGETING AND BUDGETARY CONTROL AS A TOOL FOR FINANCIAL PLANNING AND CONTROL
The Project File Details
- Name: BUDGETING AND BUDGETARY CONTROL AS A TOOL FOR FINANCIAL PLANNING AND CONTROL
- Type: MS Word (DOC)
- Size: 51.5kb
- Length: 32 Pages
TABLE OF CONTENT
- Background of the study
- Statement of the problem
- Objectives of the study
- The hypothesis of the study
- Scope of the study
- Significance of the study
- Plan of the study
- Definition of terms
CHAPTER TWO: Literature review
2.2 Concept of Budget
2.2.2 Budgeting and Budgetary control
2.3 Budget cycle and budget process
2.4 Benefits of budget
2.5 Conditions for a successful budgeting
2.6 Effects of limiting factor on budget
2.7 Behavioural Implication of Budget
2.8 Application of budgeting to non-profit making organization
2.9 Budget Improvement Techniques
2.10 Review of empirical studies on budgeting and budgetary control
CHAPTER THREE: Research Methodology
3.1 Historical background of the case study
3.2 Research Design
3.3 Population of the study
3.4 Sampling method and sample size
3.5 Sources of data method of data collection
3.6 Method of data analysis
3.7 Limitation of the study
CHAPTER FOUR: Data presentation and analysis
4.1 Presentation of Data
4.2 Data Analysis
4.3 Test of Hypothesis
4.4 Discussion of findings
CHAPTER FIVE: Summary, conclusion and recommendation
1.1 BACKGROUND TO THE STUDY
Budgeting has become one of the indispendable tools in modern day management (for both profit and non-profit making organizations). This is because budget and budgetary control, both at management and operational level looks at the future and lays down what has to be achieved. Budgetary control checks whether or not plans are realized and puts corrective measures into effect where deviations or shortfall is occurring.
In view of above blucher and Chan (1999), believed that a good management implements planned operations to attain the target results. Planning is a process of charting the future course to attain goals, recognize opportunities and minimize the adverse effects of uncertain and unavoidable events. Budget however, is one of the tools of planning used by many organization, profit or non- profit, large or small, service or manufacturing. However, budgeting at the early stage of its development was concerned with preparing and presenting credible information to legitimize accountability and to permi correct performance evaluation and consequently rewards.
Over the year, the functions and focus of budgeting has shifted considerably and business organizations become more complex and their environment becomes dynamic coupled with the emergence trend, the term budget has been differently defined and examined by various scholars in several ways.
Budgetary control is part of the overall system of responsibility accounting within an organization. It is the system that provides a basis for maintaining the progress of the organization as a whole and of its components parts, toward the achievement of the objectives specified in the budgets. This study aim at examining the impact of budgeting and budgetary control on the effective financial planning and control and the overall performance of a tertiary educational institution.
1.2 STATEMENT OF THE PROBLEM
Following the uncertainties prevailing in the business environment today, managers must prepare to compete favourably under these rapidly shifting conditions. In order to survive the environmental complexities, managers of organizations (profit and non-profit) need sharp tools, proven management techniques to forecast the major changes which are likely to affect the socio- economic environment while they choose future direction and dimension of resources needed to attain selected goals.
Budgetary control as proven management tool helps organization management, and enhances improved performance of any economic in different ways. Its primary functions is to serve as guide in financial planning operation; its also helps administrative officials to make careful analysis of all existing operation.
Budgetary and budgeting control entails a distinct pattern of decision in an organization which is capable of determining its objective, purpose or goals and how these goals are achieved by establishing principal policies and plans. However, the inability to recognize the problem concerned and fixing a boundary off investigation creates an obstacles for the successful implementation of budgetary and control (steward,1993). Some organization only look for narrow ranges of alternatives which the arrive at from their past expenses and present situations, other management levels even avoid long term planning and budgeting in favour of today’s problems thereby making the problem of tomorrow more severe.
The above reflects the need for organization to set up a formal mechanism for scanning its environment for opportunities and give early system of future problem, this course of action will improve the system of budgeting and budgetary control, resulting in an expectation of improved performance, in business and also in non-profit making organization like an educational institution as seen in this study.
1.3 OBJECTIVE OF THE STUDY
This research emphasized on how effective budgeting and budgetary control can assist in achieving the objectives of educational institutions at the tertiary level. Other secondary objectives are:
- Examine the role of budgetary system as a tool for effective financial planning and control in a tertiary educational institution.
- Identify various ways that budget is being applied as a means of financial control in tertiary institution
- Examine the motivational effect of a good budgetary system on the employees of a tertiary educational institution
1.4 HYPOTHESIS OF THE STUDY
H1: Budgetary system does not have not a role to play in the effective financial planning and control of an educational institution.
H2: Budgeting and budgetary control do not serves as a tool for financial planning and control.
H3: The application of budgeting and budgetary control in educational institution does not have motivational effect on the employees
1.5 SCOPE OF THE STUDY
The research used university of Ilorin, Nigeria, a tertiary educational institution as a case study which uses budgeting and budgetary control as a technique or tool also considered the ways in which budgets are being formulated and applied in an organization
1.6 SIGNIFICANCE OF THE STUDY
Several researches have been successfully conducted in relation to budgeting and budgetary control and their importance in various organizations. However, only few emphasized on the effect of budgetary system on financial planning and control, especially of an educational institution. For instance, False (2003), limited his work on types of budgeting and budgetary operation in organizations to this end, this research work concentrated more on budgeting and budgetary control as tool for financial planning and control in an educational institution. Budgetary system was been considered as a tool to eliminate poor financial planning and control and some other sub-optimalities in organizations.
Also budgetary in its nature of setting standards for employees may serve as a motivation factor for labour efficiency because every employee works towards the target ahead of them. Herefore, this study also examined whether and how budgetary systems motivates employees in the performances of duties.
1.7 PLAN OF THE STUDY
This research is divided into five chapter, chapter one highlights on general introduction, background of the study, statement of the problem, objectives of the study, Hypothesis of the study, scope of the study, significance of the study, plan of the study and definition of terms.
Chapter two highlights on literature revue, control budgeting cycle and budget process, benefits of budget, conditions for a successful budgeting, effects of limiting factor on budget, behavioral implication of budget, application of budgeting to non-profit making organization, budget improvement techniques, and review of empirical studies on budgeting and budgetary control.
While, chapter three highlights on research methodology, historical background of the case study, research design , population of the study, sampling method and sample size, sources of data method of data collection, method of data analysis and limitation of the study.
Also chapter four highlights on analysis of data and presentation, responses to questionnaire, data presentation, purpose of budget in Unilorin and test of hypothesis.
Finally, chapter five highlights on summary, conclusion and recommendations.
1.8 DEFINITION OF TERMS
Budgeting is the mechanism involved in developing a budget while budget can be define by the institution of cost and management accountant “1982” (ICMA as a financial and qualitative statement prepared and approved prior to a defined period of time, of the policy to be pursued during that period for the purpose of attaining a given objective it may include income, expenditure and employment of capital. From these definitions it can be deduced that budget is a statement which is prepared prior to the commencement of the operation of the organization and this statement express not only monetary terms of the business and intend to achieve with the spans of time covered in the budget. Such policies, programme and strategies and the totality of all programmes aimed at systematically achieving the cooperate objectives. In 2009 Amos A. Abohi describe budget as the qualification of a plan of action proposed towards some future objectives it gives written details of a plan shown activities required to achieve the objectives, the inter-relationship of the activities and most importantly the available resources required for each activities and cost involved, it will be seen from the above definition that budget are qualitative statement that translate the intention of the business organization
ENCYCLOPEDIA BRITANICAL 1971
Defines a business budget as a financial document representing management best estimated plans for the performance of a company during a definite future period. It also involves the integrated group of forecast of expenditure, the receipt profit and changes in assets. It therefore follow that the business budget is a representation of the best and most promising conceivable plans of a business in matching the expected level of expenditure, receipt, income and change in various definitions are major features of a most controlled system.