BUDGETING AND BUDGETARY CONTROL AS TOOLS FOR ACCOUNTABILITY IN GOVERNMENT PARASTATA

Parastatals. (A case study of Enugu State Housing Development Corporation). Budgetary control is a quantitative expression of plane of action prepare in advance of period to which it relate. The organization is face with the problem of lack of budgeting while planning and controlling their activities. The objective of the study is to determine if budgeting and budgetary control affect the quality of services delivery in government parastatals. The research also aims at determining if budgetary control contributes to the improvement of management efficiency and high productivity. Data were collected from primary and secondary source. Secondary source of data were collected from textbooks, periodic articles and journals. Questions were distributed as well as personal interviews with functional and departmental heads were conducted. The sample size of 60 were used and was chosen among the number of department / section using Bowleys proportional allocation formula Data were analyzed using table and simple percentage, hypothesis were tested using chi-square statistics. We discovered among other things that budgeting and budgetary control affect the quality of service delivery in government parastatals. It was also revealed that budgeting and budgetary control contributes to the improvement of management efficiency and high productivity. In line with the above, we recommend among other things that the budget plan and preparation should be a corporate duty of the unit heads with head of department in the corporation, improving legislation, realistic budget target. Adherence in the budgeting provision should be practiced by top management.

TABLE OF CONTENTS

Title page

Approval page…………………………………………..…………..……i

Dedication .……………………………………..……………….....…...…ii

Acknowledgement.…………………………………………...……...…iii.

Abstract.……………………………………..…………………….….................…iv

Table of contents.……………………………………..……....................................v

CHAPTER ONE:

1.0     Key words / introduction.………………………………………...…………1

1.1             Background of the study .……………………...……………………………1

1.2             Statement of problem.…………………………………………….…………4

1.3             Objective of the study.………………………………………………………4

1.4             Research Question.……………………………………………………..……5

1.5             Hypotheses of the study.……………………………………….……………5

1.6             Significant of the study.………………………………………..……………6

1.7             Scope and limitation .……………………………………………………..…7

1.8             Definition of terms .…………………………………………………………8

CHAPTER   TWO

2.0     Review of related literature .……………………………….………………10

2.1     Budgeting and budgets.……………………………….……………………10

2.2     Current literature on theories models.……………………………….……..19

2.3     Empirical study.……… …………………….…….……..21

2.4     Features of budgets.… ……………….……..23

2.5     Budgetary control.…………… ………………..….……..37

2.7     Advantage of zero based budgeting.……………………………………..44

2.8     Disadvantage of zero based budgeting .………… ……..44

CHAPTER  THREE:

3.0     Research Methodology.………………… ………..…..48

3.1     Research design.……………… ………………..……..48

3.2     Source of data .………………… ………………………..49

3.3     Population of the study.……………… ……….………………50

3.4     Sample / sampling technique.……………… …………..…..51

3.5     Instrument  for data collection .………… …………...………..53

3.6     Reliability / validity of  research instrument .………… ……...…54

3.7     Method of  data Analysis .……… ………………………....…54

3.8     Decision criterio validation of hypothesis .………………...……55

CHAPTER FOUR:

4.0     Data Presentation  and Analysis .…………………………56

4.1     Data presentation.………………..........................………………56

4.2     Testing Hypothesis .………………...………………..………75

CHAPTER  FIVE:

5.0     Summary of Findings / Conclusion and Recommendation……..……….87

5.1             Summary of Findings .………………...........................................87

5.2             Conclusion .………………...................................………………88

5.3             Recommendation .………………............................……………53

References................................................………………91

Appendix 1.……………….....................................………………93

Questionnaires .………………...................................……………94

                                      CHAPTER   ONE

  1.0       INTRODUCTION

  1.1       BACKGROUND OF THE STUDY

The efficiency and effectiveness of the operations of a business

depends on the control available to management in almost every business organization, there are a number of activities going on at the same time such as producing, purchasing, distributing, selling and financing a product. These are interrelated in such a way that they affect the attainment of the organization goals.

The institution of cost and management accountant(ICMA)defined budget as a financial or quantitative statement prepared and approved prior to defined period of time of the policy to be pursed during the period for the purpose of attaining a given objectives. It may include income, expenditure and the employment capital.

Therefore in order to achieve these objectives or goals, the

organization must economize resources and discover the means of achieving these goals. These goals can only be realized when the property planned use of available resource are controlled and co-ordinate effectively. Thus a system of managing a business by making forecast of the different

 activities and applying a financial to each forecast becomes imperative. These forecasts

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Are guided by the information and adoption of planned system such as techniques in budgeting, variance analysis. Etc.

Pandy (2008) defines budgeting control as the establishment of departmental budget relating the responsibilities of the executive to the requirement of a policy, and the continuous comparison of actual budgeted result either to secure by individual actions. The objective of that policy is to provide a firm basis for its revision.

Osisoma, (2000) opined that budgeting is a systematic and formalized approach for accomplishing the planning, co-ordination and control responsibilities of management. It is a process of preparing in advance of the period to which it relates a summary statement of plans expressed in quantitative terms, which if utilized with sophistication and good judgment, would enhance the attainment of an organization’s objectives. A budget therefore, is a plan quantified in monetary terms, prepared and approved prior to a defined period of time, usually showing planned income to be generated and /or expenditure to be incurred during that period, and the capital to be employed to attain a given objectives.

A budgetary control is described by lacey, (2002) as a quantitative expression of a plan of action prepared in advance of the period to which it relates. Budget may be prepared for the business as a whole, for

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Departments, for functions such as sales and production, or for financial and resources items such as cash, capital expenditure, manpower, purchase. Etc. the process of preparing and agreeing budgets is a means of translating the overall objectives of the organization into detailed, feasible plans of action. It is therefore, germane to say that the level of importance that is attached in this plan and effort made in controlling the finance differ in organizations. Once the goals are set, which must be based on the detailed analysis of feasibility within the content of the political and social value the plans will enable it to strive towards its attachment.

Often than not when these plans are put into operation, conditions prevail which trends to cause deviation from the plan and corrective measures are always taken to steer the business back on the right track. The process already mentioned as it is applied entailed budget and its control. And to lend credence to goal congruence suitable techniques should be applied to specific areas that need special attention hence measurement of budgeted with actual to arrive at the finance cannot be over emphasized. A business is said to be on the right track if the outcome of the budgeted estimate is favorable as against the actual. The little that is said concerning this project has encompassed all avenues in which the subject can aid