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Critical Analysis Of Budgetary Control Its Effectiveness And Efficiency In A Non Profit Making Organization
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CHAPTER ONE
INTRODUCTION
The essence of budgeting is to provide an
essential element of control in an organization in order to facilitate
the achievement of set objectives .The control process is the
fundamental organization link between the manager and the other people
in an organization in a non profit making organization output various
with the objective with which they were established. The objective of
public organization could be social and or development in nature
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however this does not means that public organization can not make profit
if government policy changes to privatizing or commercializing them.
The main structural problem of these type of organization is the
sacrifice of the organization profitability for social efficacy which
must be achieved in research institute Badeggi falls into this category.
With the use of budget as a control tool, there is Ned for planning
a the performance of an organization. Planning as defined by C.I.M.A is
an the establishment of objective and the formulation evaluation and
selection of the formulation of the policies strategies tactics and
action required to achieve these objective, by planning activities in
advance more economical use is made of the organization resource and
facilities and a fairly accurate estimates of it s future resources
requirement can be determined.
One of the outstanding features of
budgetary control is that policy plans resource s and activities of the
organization are coordinated integrated and controlled to achieve the
desired objectives.
Budgetary control is a means of providing some
centralizing control where activities and also responsibilities are
decentralized.
It is also the use of budget for assigning
responsibilities planning and controlling performance and guiding
managerial and other activities of the firm towards the achievement of
organizational objectives. It involves, setting out clearly defined
forgets of output , income and expenditure for each section of the
organization .Embodying these forgets of performance in sectional
divisional and departmental budgets co0mpariing these budget standards
with actual performance .identifying deviations or variances from the
budget and taking corrective action or bringing performance in line with
budget targets .this is because all the heads of departments in the
organization are involved in the preparation and implementation of
budgets, while management5 control the whole activities of the
organization.
Budgets are prepared as a result of committee work
.Each cmmittee constituting of representatives of various departments
and functions to be controlled .the heads of departments are responsible
for the respective department budget
Each executive or manager can
then fully appreciate his responsibilities ,as they are reflected in his
department budget .Any deviation of the actual result from the estimate
and forecast are traced back to the department head or manager.
1.1 PURPOSE OF THE STUDY
Most
of the non_ profit making organization in Nigeria are governmental in
nature, this is because they are mainly set up for social and
developmental purposes, this usually leads to a poor planning and
control measures. The purpose of this study is to critically analyze the
budgetary control system as a planning tool in non_ profit making
organization using National cereals Research institute as a case study.
This research work intend to bring about clearer understanding of the
need for an effective and efficient budgetary control in a nonprofit
making organization which will also be of benefit to other similar
Organization leading to an improvement in government owned organization budgetary control system.
1. 2 STATEMENT OF PROBLEMS
public
sector and other nonprofit making organization are often noted for
inefficiencies and poor management, which is as a result of poor
planning through repetitive budgeting. Recent studies in the area of
budget and resources allocation have shown lack of proper analysis.
There is a general lack of the concept of why we have a budget at all.
This issue calls for immediate investigation of budgeting as a tool for
resources planning and performance control and to recommend how it can
function properly.
1.3. OBJECTIVE OF THE STUDY
The main objective
to be achieved from this research work is that, it will; serve as a
means of measuring the output or the work performed and to compare it
with the cost of input. This comparison provides a basis for indicating
efficiency and effectiveness.
The process of comparing actual
results with planned and evaluating variance if any set a control frame
works which help expenditure to be kept within an agreed limit. If this
deviations are noted, so that action can be taken to correct this in the
future.
1.4 SCOPE OF THE STUDY
The study intend to cover
budgetary control as it affect National cereals Research institutes
{N.C.R I} . it will examine its budgeting control as a measure of
performance.
1.5 RESEARCH QUESTIONS
The followings are the research questions of the study.
1. Historical Background
A Was there any Decree /Act by Government that established the institute? (If any, quote with date.)
B What are the objectives of the Federal Government in establishing the institute?
C How does the institute relates with the ministry?
D What is the organization structure of the institute like?
E Looking at the organization structure, what are the function of this department?
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ABSRACT - [ Total Page(s): 1 ]This research work will be A very crucial study for non- – profit making organization in Nigeria. The role of non – profit making organization in any economy is indispensable. To give this effort proper direction, it is identifiable that the key ingredient in translating this dream into reality is to bring about a clearer understanding of the need for an effective and efficient budgetary control in a non – profit making organization. The research will be carried out through ... Continue reading---
