BUDGETING AND BUDGETARY CONTROL IN A BUSINESS ORGANIZATION (A CASE STUDY OF AFRI BANK NIGERIA PLC. ILORIN)
In carrying out on investigation into an Afri -Bank of Nigeria plc, the major objective of any business Organization is base on profit maximization and improved future which leads to use of budgeting and burglary control, business organization to enhance growth and survival of the organization.
Chapter one of this project work : Will explain what study of background is all about the statement of problems, the aims and objectives of the study , the significant and scope of the study , the limitation and research hypothesis and definition of terms and concept.
Chapter two: Will review the relative literature e.g the Historical development, meaning and usefulness of budgeting and budgetary control in business organization,
Types and budgeting process, preparation and administration of budget, fundamental principles and budget implementation and control including Budgetary improvement techniques.
Chapter three: this chapter will expose the research methodology ie research design, characteristic of the study population, sampling method, research instrument and as well method of data process.
Chapter four of this project work will simply talk of presentation interpretation and analysis of it shows that the organization’s staff agreed that the organization prepare budget.
Chapter five: This will be the last chapter of the research work and it‘ll summary, conclusion and recommendation and questionnaire, the reliant and useful point of action that will solve the study problems.
TABLE OF CONTENT
Table of content
1.1 Background of the study
1.2 Statement of the problem
1.3 Aims and objective of the study
1.4 Significant of the study
1.5 Scope of the study
1.6 Limitation of the study
1.7 Research hypothesis
1.8 Definition of terms and concepts
2.2 Historical development of budgeting
2.3 Meaning of budget, budgeting and budgetary control
2.4 Usefulness of budgeting in business organization
2.5 Types of budget
2.6 Preparation and administration of budget
2.7 Budgeting and administration of budget
2.8 Fundamental principles of budget
2.9 Budgetary improvement techniques
2.10 Budget implementation and control
3.1 Research methodology
3.2 Characteristics of the study population
3.3 Sampling method
3.4 Research instrument
3.5 Method of data process
PRESENTATION INTERPRETATION AND ANALYSIS
4.1 Presentation of data
4.2 Analysis of data
SUMMARY, CONCLUSION AND RECOMMENDATION
1.1 BACKGROUND OF THE STUDY
The fundamental question which should be asked about any enterprises is “How well is it doing?” ad his can be rightly answered accessing the extent to which the objectives of the enterprises are achieved.
The major objectives of the enterprises are achieved, base on profit maximization and improved future profit tend to enhance growth and survival. The increasing complexity of the business and ever changing condition of the business environment, social environment technological and political changes have made companies investors and management to realize the need for new techniques to protect and improve performance.
To achieve the Afro- mentioned objects it becomes imperative for management of business organization to develop ways of attaining them.
The available instrument at Management’s disposal is the adoption of adequate planning and control. one of the basic device used in planning and controlling the activities of business enterprise is by means of financial standard and management of budgeting and budgetary control.
To many the terms can not retraining influence on action service the needs or opportunity which the enterprise would like to service budgeting remains the most tactical budget is essentially on agenda setting. It is carefully designed, packaged and aimed at achieving the goals and objective of business organization or individual with the limited resources at their disposal.
According to fubara( 1988) in his book “ business management principle and strategies.
He further and described budgeting is a means of utilizing collective knowledge of an enterprise to prepare a co-ordinate plan for future activities.
Budgeting control is a techniques that emphasizes control of plan by companing actual result against target to identify variance upon which corrective measure should be taken to improve the performance of the enterprises.
The primary function of business organization is production of goods and services and make it available for the consumers when ever is needed. All these functions are performed in order to achieve the organizations goals which is profit maximization. Performances are evaluated based on the actual result. To achieve the organizational objectives there is need for adequate planning and control, efficient budgeting and effective budgetary control system in business organization.
1.2 STATEMENT OF THE PROBLEM
Budgeting and budgetary control is very important in business organizational due to its function in relation to planning , organize coordinating and controlling functions of management forwards.
Successful realization of the organizational objective. Performance evaluation in business organization is usually base on effective decision making and efficient resources allocation. These have been affected due to the incorporate of budget and budgetary control.
This improper budgetary control responsible for poor performance of some business organization most business organization do prepare budget. Yet there are deviation from such budgets and they fail to investigate the causes deviation and thus take appropriate corrective measures to prevent re-occurrence most business organization sues budgeting as just useful for planning purpose but refuse to take cognizance of its benefits whom to revise budgets to make it reflect prevailing situation or whom to hold responsible for budget vacancies.
1.3 AIMS AND OBJECTIVE OF THE STUDY
The main aim of this research work is to examine budgeting and budgetary control in business organization in order to see the extent to which it’s to be applied in management planning and control.
These are some of the aims of the research work.
i. To examine the procedure for drawing up budget in business organization and to know how budget are being approved implanted, improved and revised.
ii. To know who there budgeting and budgetary controls assist the managements of business organization effective decision making and efficient resources allocation.
iii. To know whether the use of budgeting and budgetary control is indispensable to achieve organizational goals and objective.
iv. To evaluate performance by comparing budgetary with actual result of the business stand
v. To know whether budgeting and budgetary control serves as a communication tools between the top management and the low staff.
vi. To provide a useful l recommendation on the application of budgeting and budgetary control as means of improving business performance.
1.4 SIGNIFICANCE OF THE STUDY
Several research work have been carried out on budget and budgetary control in various business organization like manufacturing , pharmaceutical and oil industries.
This research work can be said to be a fair work on the topic. This research will share more light on the efficient resources and effective decision making in business organization.
This research work can be said to be a fair work on the topic. This research will share more light on the efficient resources and effective decision – making in business organization.
It will also help the student to know how relevance budgeting and budgetary control is to an individual and business organization.
1.4 SCOPE OF THE STUDY
This research work will examine in details budgeting and budgetary control with emphasis on how its application aids in planning and controlling of activities of business organization to enhance or improve performance.
There are different types of banks as a business organization but commercial bank are the prominent types of business organization because of the n umber size therefore this research work is limited to commercial bank with Afri Bank Plc as a case study.
6. LIMITATION OF THE STUDY
Firstly, this research has the limitation of financial problems in the cause of carrying out the study.
Secondly, it was that due to time factor as the research was carried out along with academic work. Also, detailed budgeting statement and the corresponding actual result are not made available by the bank because of high confidentiality and very competition in the banking industries.
However, it is the researchers believe that the finding of the research will represent the pictorial of budgeting and budgetary control of the study.
1.7 RESEARCH HYPOTHESIS
The research shall focus and test the following alternative hypothesis.
The hypothesis is denoted with Ho alternative is denoted with Hi
i. Ho: There is no proper budgeting and effective budgetary in business organization.
ii. Hi: applications of budgetary control system do performance of business organization in terms of objectives realization.
1.8DEFINITION OF TERMS AND CONCEPTS
Budget is a document containing words and figures which proposes expenditure for certain items and purpose.
Budget is a document or a collection of document that refers to the financial condition of an organization.
Budget is also merlya plan expressed in quantitative terms.
TERMS OF BUDGET
1. Budget cycle: Public budgeting system which are devise for selecting society ends and consist of numerous participants
2. Budget preparation and submission: phase of the budget is carried out by the executive aim of the government.
3. Budget authorization: Having compiled the various department estimates, the draft budget is new to be sent to the legislatures for authorization
4. Executive of the budget: Budget execution commences the moment the presidents signs the general warrant incur expenditure execution invest the transaction of financial outlays approved in the budget plants of action.
5. Line item budgeting: Is the tradition budgeting it is oldest types of budget.
6. Performance budget: was aimed at enhancing effectiveness and improving efficiency in public budgeting.
7. Planning programming budgeting system: Approach to budgetary decision making is a system approach that attempts to influence the choice.
SOME BUDGET CONCEPTS
i. Recurrent revenue: This include the year to year revenue of government from sources like taxes fines free specific charges profit.
ii. Capital receipt : These are in form of loan and graint
iii. Capital expenditure : This involves expenditure on productive economic activities i.e on agricultural road , Hospital and university etc..