Beruflich Dokumente
Kultur Dokumente
BY
UMEILEKA NGOZIKA
ACC/2009/545
DEPARTMENT OF ACCOUNTANCY,
FACULTY OF MANAGEMENT AND SOCIAL
SCIENCES, CARITAS UNIVERSITY, AMORJI- NIKE EMENE
ENUGU.
AUGUST, 2013.
i
TITLE PAGE
BY
UMEILEKA NGOZIKA
ACC/2009/545
ENUGU
AUGUST, 2013.
ii
APPROVAL PAGE
Accounting.
_________________ _________________
Project Supervisor
________________ ________________
(Head of Department)
_________________ __________________
DEDICATION
care and mercy, and also being with me to the completion of this work,
ACKNOWLEDEGEMENT
his guidance, grace and strength for not only leading me through in this
research work, and also for the successful completing the tasks required
him, I would not have been able to complete this project work.
Ann Umeileka and my lovely father Mr. Angus Umeileka for their
their constant closeness and financial support during the course of the
programmes and in research difficulties. May God bless you all. I also
and encouragement.
debt to several authors whose articles in journals and books have been
ABSTRACT
TABLE OF CONTENT
Title Page i
Approval page ii
Dedication iii
Acknowledgement iv
Abstract v
CHAPTER ONE
1.0 Introduction 1
Reference 9
viii
CHAPTER TWO
Administration 28
Historical background 50
References
CHAPTER THREE
CHAPTER FOUR
CHAPTER FIVE
Recommendation 95
5.2 Conclusion 96
5.3 Recommendations 97
Bibliography
Appendix
s
1
CHAPTER ONE
1.0 INTRODUCTION
organization, there are a number of activities going on at the same time such
These are interrelated in such a way that they affect the attainment of the
organization goals.
to defined period of time of the policy to be pursed during the period for the
these goals. These goals can only be realized when the property planned use
generated and /or expenditure to be incurred during that period, and the
departments, for functions such as sales and production, or for financial and
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
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
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
4
business.
The growth of the business hinges, or better put, rests squarely units
tools in any business situation. This study then is aimed at assessing and
evaluating the event to which budgetary control has been a tool for the
indiscriminate use of fund meant for more viable activities. Again the
the budget system by middle and low level of management staff. Other
problems are shortage of stocks and shut down. These and many more are
The primary purpose of this study is four fold. They include the
following:
5
high productivity.
ii. What are the connection between the type of budget implemented
iv. How can budgetary control be used for assessing Managers budget?
1. H0: Budgeting and budgetary control does not affect the quantity of
managers budget.
managers budget.
Budgeting is necessary to make matters simple and hence life easy to handle.
utilities etc.
of the overall funds that the concerned government will spend on various
sectors, the kinds of tax that would be levied and how the prices of essential
writers who may wish to carry further study on budget and its control
apparatus.
regards to giving out information. Time constraints are also a limiting factor
8
in undertaking this study. The availability time and short period of the study
made it difficult for the researcher to carryout a wider and more through
is very few.
estimate.
result.
REFERENCE
CHAPTER TWO
have limited resources and these limited resources impose limit on the
number and range of goals that the organization can hope to attain. One
concern.
On the other hand in a small firm the owner jot down his budget on a piece
of scrape paper or even on the back of a used envelope, some even manage
without writing anything down at all they have done the budget in their
the entire organization. The origin of budgeting can be traced to Egypt the
12
The word budget comes from the friends for a small bag or purse
environment and the ever increasing competition among firms in the modern
and usually monetary terms every a specific period of time. Normally the
period covered is one year and this makes it a short term plan. Practically all
large organization bothn in the private and public sectors prepare annual
budgets. He is of the view that budget is a short term financial plan which
advance of the period to which it relates. Budgeting may be prepared for the
feasible plans if actions. This is usually prepared for a stated period of time
usually one year. A budget may be prepared simply using paper and pencil
pursued during that period for the purpose of attaining a giving objective.
Adams (2009) is of the view that budget is a future plan of action for
spend government fund without the approval of the parliament. The budget
economy and the expected future trends. He states that the primary
could be used.
ii. To plan, control and estimate the amount to be received and spent
work force.
their domains.
economic activities. For instance government obtain its revenue from taxes
and other sources which are use for current operations. Government budget
Drury (2004) agrees that budget as the design of a desired future and
desired objective for periods extending beyond one year. Budget on the
other hand must accept the environment of today, and the physical, human
planning efforts.
16
the operations and resources of an enterprises for some specific period in the
during that period and the capital to be employed to attain a given objective.
From the above definition of budget one can deduce that the purpose
departmental plan must happen at the same time in order to achieve the
super a budget is, it is bound to fail if it is not back up with effective control
plan.
areas namely:
a. The budgeting process sets the basis for judging whether actual
performance and
There are avenues for achieving an end and these avenues relates to
the forms, processes and method involved, and consequently the planning
various forms of budget through with the planning and control are affected
The commonly widely used types are fixed and flexible budgets.
permitted cost levels to suit the level of activity actually attend. The process
by which this is done is by analyzing costs into their fixed and variable
elements so that the budget may be fixed according to the actual activity. For
control purpose this vital that fixed budgeting is used. Only by comparing
20
what the cost should have been with the expenditure incurred at the actual
activity level can any control be exercised. The major purpose of a fixed
budget is at the planning stage when it serves to define the board objectives
The procedure for developing a flexible budget are simple enough but the
results obtained from flexibility a budget Are only accurate if the costs
been are in the ways predicted. A flexible budget on the other hand estimate
volume of activity.
imperative to state here that a company win a steady run but secondary
drafting budgets when the budgets are drawn up the one main objectives
must be ,upper most in the mind of top management that is the budget are
for:
for the whole business. Each part must inter lock with the others parts.
b. Control: Just because a plan is set down it does not mean that the plan
will carry itself out. Control is exercised in the budgets, thus the name
is given a guide to help them to produce certain desired results and the
TYPES OF BUDGET
of the operating budgets that is the expected cash in flows and cash
out flow. Financial position and other operating results. The most
operations.
24
costs and flows of each project. Such project require large sum of
money and have long term implications for the firm. Capital budget
long term have to be made and they involve a great deals of risks and
uncertainty.
and budgeting provides the ideal place where such planning can be
3. Managers can see how their works shots into the activities of the firm.
persons because managers can identify their positions within the firm
and can see their job really are essential to the proper functioning to
the firm.
4. The budgets for a firm cannot be set in isolation. This means that the
situation of the business, the nature of its products and its workforce
etc, must be seen against the economic background of the country. For
paying higher than normal wage rates. Increasing the sales target
shortage of money upon the demand for the firms goods and so on.
output, or lorry mileage, etc. The effect that each of them has upon
that his haulage fleck of Lorries cockers until the cost of doing such a
may be then and only then that be starts to search for possible
that fewer mites are covered and yet the same delivery services is
all.
OBJECTIVES OF BUDGETING:
1. STATE OF EXPECTATION:
firms.
2. COMMUNICATION OF EXPECTATION:
does not mean that the goals will be achieved. The manager
should know that the gods are, they should understand and support
them.
3. PLANNING:
results.
materials and other resources so that goals of the firm are attend at
ADMINISTRATION
organizational structure may be in the form of line and staff, admitted, line
of all executives involved in the setting of goods and devising the polities
activating from the lowest may construct his own budget and submit it is the
following:
30
company from its operation as well as the focus of much that is done within
a company. It also serves as a units per month the stock levels would usually
have to be more than 100 units, whilst if the stock were to be kept at 100
unit minimum the production figures each mambo would equal the sales
figure.
2. PURCHASING BUDGET:
beginning inventory and the desire ending inventories. The unit of material
This is because indirect costs are included in the manufacturing altered costs
4. CASH BUDGEGT:
31
Osisioma (2000) opines that cash budget represent the cash receipts
and payments and the estimates cash balanced for each in flows and
out flows over the budget periods. The objective of the cash budget
agreed period usually a year. The cash budget is used to plan the
balance to meet its needs and uses the idle cash in the most
profitable manner.
budget period the term runs out of cash funds. When talking about cash in
32
budget we are also usually including have funds, and therefore in this book
cash and cheque received. Cash is therefore also budgeted for so that any
concerned with lending of money certainly resent most strongly one of their
customer needing a bank overdraft without proper warning when in feet the
advance which rejected the need for cash fund on a particular date.
The finance needed may not just be way of borrowing from a bank or
finance house it may well be a long term need that can only be satisfied by
a. Having to think a head and plan for the future and express the plans in
about the future will not do. A general optimistic feeling that all will
be well often not stand up to scrutiny when views of the future are
mean that you can negotiate for a loan in advance, rather than at the
same time when you have actually out of cash. Bankers and others
In borrowing money you have to give the under the confidence that
the loan will be repaid at the proper time plus any interest and charges
any calmly thought-out plan will not inspire such confidence and will
often laid to the loan terming refused ass the lender may think that the
It is not only that you risk the loan been refused. Lender will
often realize that they have at their money and will change much
34
higher rate of interest and impose other conditions that otherwise they
c. Knowing about the need to borrow in advance also widens the possible
investors other than bankers rarely have large sums of cash quickly
available. They need time to run their own investments into cash
d. Alternatively you may find that you will have cash funds surplus to
properly how you can invest this surplus cash until required , thus
matter how large the amount. Bonus often have deposit accounts into
then transferring the necessary sums back into the current account
when required by the business. There are also other sorts of short term
investments which your back or account can advise you to put your
financial effect of the total plans for the business. The master budget
sheet.
ale
budg
et
36
Sale
Budget
Selling Inventory
Budget
Production
Budget
Selling Expenses
Budget
Admin Expenses
Budget
Budget Income
Statement
results with the budgeted data, evaluation for difference and the taking of
budget and actual data could occur only after actual accounting data have
been accumulated.
necessary for moving into new fields. For instance, products are brought
help.
38
control and that each budget has the action of the people their performance
accounting and budgeting he was of the view that accounting system and
budget are built around the organization structure and both are information
system concerned with the same operation and financial situation. The
budgeting process helps to organize and formulate the planning required for
the extent to which the plans have been achieved. Budgetary control is
results.
budgets are comprised; they will be largely ineffective run less an efficient
routine is in operation for comparing result with the budget and explaining
cause of this variance are sought out and checked thus enabling management
Ama (2003) explains budget control for a cool for planning while
budgetary control services as the yard stick for the measuring actual
perhaps negatively.
budget target.
42
Investigate the
difference variance
actions
2.7 INNOVATION IN THE AREA OF BUDGET ZERO-BASED
BUDGETING (Z.B.B)
Each functions budget state with the assumption that the fractions
does not exist and is at zero cost. Increments of the cost are compared with
43
approach whereby it is assumed that the allowance for an item is zero and
will remain so until the manager responsible justifies the existence of the
cost item and the benefits the expenditures brings. Using this method, a
questioning altitude is developed whereby each cost item and its level has to
be justified in revelation to the way it help to meet objectives and how the
introduced in the early 70s in United States of America and its aimed at
department.
motivation.
decision packages and for the ranking process. The skill may not exist
in the organization.
threats can rise at any time and organization must be flexible enough
who may prefer the cost status quo and who sees the details of
e. There are considerable problems inn ranking ;packages and there are
quantitative benefits.
Zero Based Budgeting (ZBB) cab be divided into three stages, thus
forms of activity task and expenditure to carry out the same job
benefits.
will then rank all the packages in the basis of their benefits for the
different activities some of which already exist and others that are
new.
children will make provision for vehicles, medicines and technical staff
rather the salaries and wages and other objects of the expenditure.
ways:
programmer to be provided.
characteristics.
of meeting them.
in the future.
programme, and
49
feature.
activity.
Fourthly, there must be multi year costing which also permits the
policy objectives.
HISTORIC AL BACKGROUND.
back to the days of east central state housing development cooperation that
with the responsibility of building houses and estates to be used for both
owing to the splitting of the then east central state into Anambra and Imo
state.
51
was established in 1976, to take over the functions of the east central
government in 1991, carved not Enugu state from the old Anambra state
facilities of the former east central and Anambra state thrusting development
corporation while the staff was made up of party employees of the former
ORGANIZATION STRUCTURE:
shows the juilisim which perform the actual function of the corporation and
those that perform the auxiliary function such as the public relations
function of the board hence section 5 of the edit stipulated that the board is
b. Manage all the business and keep and preserve all the property of the
corporation and
52
appoint and disserve the board ties with the governor of the state.
2. Sub jut to this edict and the constitution of the federations the
corporation may do all such things are in its opinion, necessary for, or
conducive to, the proper discharge of its functions under the edict.
53
REFERENCE
Adams R.A (2009) Public Sector Accounting and Finance made Simple,
Revised edition 2. Lagos; corporate publisher veneers
CHAPTER THREE
conduct the research. It provides the glue that holds the research project
together.
Zita and Ozougwu (2010) define research design as the function of the
objective and the specific information requirements. They also went further
that should be used to collect and analyze the data needed by the decision
makers.
Eze and Agbo (2005) opines that research design is the specification
of procedures for collecting and analyzing data necessary to help solve the
problems at hand, such that the difference between the cost of obtaining
PRIMARY DATA:
Bordens and Abbot (2002) define primary data as those containing the
full research report including all details necessary to duplicate the study. The
study.
in government parastatals.
Development Cooperation.
primary sources. It is also a data cited y someone other than the user. The
secondary data were obtain through reading material from Enugu State
notes, periodicals, journals etc. the secondary data were relied upon for the
literature reviewed while much reliance was out of primary sources for
This research work took the researcher to use the following libraries.
which involves the list of questions structured using open-ended and close-
establish the validity of the questionnaire it was subjected to test and retest
area over a number of items to respondent who scored and returned the
critical sample copies given to them. The copies were analyzed and found to
have been properly scared meaning that the respondents understood the
intended to measure.
CORPORATION
Departments Population
Finance 21
Health 15
Security 10
Housing 13
Insurance 11
Total 70
part of the population from which a part of the entire population can
inperred.
population:
60
Where n =sample
N =population
The sample size of the population is 60 and the researcher issue the
applied.
Where:
N = population size
Finance:
61
Health:
Security:
Housing:
Insurance:
percentage to analyze the data collected to ensure that results arrived at were
62
valid and not out of chance while chi-square was used for testing the
hypothesis.
= Summation
Fo = Observed frequency
Fe = Expected frequency
HYPOTHESIS
REFERENCE
CHAPTER FOUR
The data collected was presented in simple table. The data analysis
was based on the answer to question raised from the staff of Enugu State
Questionnaire Administration
Table 4.1.1
Returned 60 92
Not Returned 5 8
Total 65 100
92% were returned as duly completed while 5 that is 8% were not returned.
Table 4.1.2.
Male 35 58
Female 25 42
Total 60 100
Table 4.1.3
Single 20 33
Married 40 67
Total 60 100
shows that a good number of the staffs are either single or married.
Table 4.1.4
Question 3: Age
Below 18 years 12 20
18 29 years 15 25
30 39 years 20 33
40 49 years 9 15
50 and above 4 7
Total 60 100
within below 18 years, 25% representing 15 respondents fell within the age
years, 15% representing 9 respondent fell within the age of 40 49 year and
Table 4.1.5
WAEC 10 17
NCE/OND 18 30
HND/BSC 30 50
Total 60 100
Table 4.1.6
Question 5: Department
Finance 20 33
Health 12 20
Security 9 15
Housing 10 17
Insurance 9 15
Total 60 100
Table 4.1.7
Strongly agree 30 50
Agree 21 35
Undecided 4 7
Disagree 4 7
Strongly disagree 1 2
Total 60 100
means of planning.
70
Table 4.1.8
Strongly agree 20 33
Agree 26 43
Undecided 3 5
Disagree 7 12
Strongly disagree 4 7
Total 60 100
respondents strongly agree that budget are used as basis for controlling, 43%
representing 12% disagree that budget are used as the basis for controlling,
controlling.
71
Table 4.1.9
Option No of Percentage %
Respondent
Strongly agree 24 40
Agree 10 17
Undecided 16 27
Disagree 2 3
Strongly disagree 8 13
Total 60 100
working. The inference is confirmed by the data in table 4.1.9 in which 40%
Table 4.1.10
parastatal
Strongly agree 35 58
Agree 19 32
Undecided 6 10
Disagree - -
Strongly disagree - -
Total 60 100
Table 4.1.11
Strongly agree 35 58
Agree 16 27
Undecided - -
Disagree 7 12
Strongly disagree 2 3
Total 60 100
Table 4.1.12
in budget
Strongly agree 29 48
Agree 12 20
Undecided 5 8
Disagree 10 17
Strongly disagree 4 17
Total 60 100
Table 4.1.13
75
Strongly agree 40 66
Agree 13 22
Undecided 7 12
Disagree -- -
Strongly disagree - -
Total 60 100
Table 4.1.13 shows that budgetary and budgetary control affect the
strongly agree that budgeting and budgeting control affects the availability
respondents agree that budgeting and budgeting control affects the quality of
Table 4.1.14
Option No of Percentage %
Respondent
Strongly agree 30 50
Agree 18 30
Undecided - -
Disagree 12 30
Strongly disagree - -
Total 60 100
Table 4.1.15
77
managers budget
Option No of Percentage %
Respondent
Strongly agree 40 67
Agree 20 33
Undecided - -
Disagree - -
Strongly disagree - -
Total 60 100
strongly agree that budgeting and budgeting control is used for assessing
Table 4.1.16
Option No of Percentage %
Respondent
Strongly agree 20 35
Agree 16 27
Undecided 9 15
Disagree 10 17
Strongly disagree 5 8
Total 60 100
that there is connection between the type of budget implemented and actual
Table 4.1.17
Question 16: Budget forces management to think about and plan for
the future.
Option No of Percentage %
Respondent
Strongly agree 34 57
Agree 14 23
Undecided 10 17
Disagree - -
Strongly disagree 2 3
Total 60 100
agree that budget forces managers to think about and plan for the future,
about and plan for the future, 17% representing 10 respondents are
Table 4.1.18
Option No of Percentage %
Respondent
Strongly agree 28 47
Agree 16 27
Undecided 3 5
Disagree 8 13
Strongly disagree 5 8
Total
Table 4.1.19
Option No of Percentage %
Respondent
Strongly agree 35 58
Agree 15 25
Undecided 10 17
Disagree - -
Strongly disagree - -
Total 60 100
agree that budgeting process can answer potential business before they
Table 4.1.20
Option No of Percentage %
Respondent
Strongly agree 28 47
Agree 14 23
Undecided 12 20
Disagree 6 10
Strongly disagree - -
Total 60 100
Table 4.1.21
Question 20: Budget define goals and objectives that serves as benley
Strongly agree 20 33
Agree 15 25
Undecided 13 22
Disagree 5 8
Strongly disagree 7 12
Total 60 100
that budget define goals and objectives that serves as bench mass for
disagree.
Having presented all the information and data gathered from the staff
= Summation
Fo = Observed frequency
Fe = Expected frequency
Df = (r 1) (c 1)
= (5 1)(2 1)
= (4)(1)
=4
HYPOTHESIS ONE
Strongly agree 35 58
Agree 16 27
Undecided - -
Disagree 7 12
Strongly disagree 2 3
Total 60 100
agree
Agree 16 10 6 36 3.6
Undecided 0 10 - 10 100 10
Disagree 7 10 - 3 9 0.9
Strongly 2 10 - 8 64 6.4
disagree
Total 60 83.4
86
Therefore Df (r 1) (c 1)
= (5 1)(2 1)
= (4)(1)
=4
X2 tabulated = 9.49
Decision Rule
calculated, accept the alternative hypothesis (H1) and reject the Null
hypothesis.
Decision
hypothesis (H1) when state that budgeting and budgeting control affect the
HYPOTHESIS II
research question.
Strongly agree 30 50
Agree 18 30
Undecided - -
Disagree 12 20
Strongly disagree - -
Total 60 100
88
Agree 18 10 8 64 6.4
Disagree 12 10 2 4 0.4
disagree
Total 60 66.8
Therefore:
Df (r 1) (c 1)
= (5 1)(2 1)
= (4)(1)
=4
X2 tabulated = 9.49
89
Decision Rule
calculated, accept the alternative hypothesis (H1) and reject the Null
hypothesis (Ho).
Decision
hypothesis (H1) which state that budgeting and budgeting control contribute
accepted while the Null hypothesis (Ho) which state that budgeting control
productivities is rejected.
HYPOTHESIS III
managers budget.
budget.
research question.
90
managers budget.
No. of
Options Percentage %
Respondent
Strongly agree 40 67
Agree 20 33
Undecided - -
Disagree - -
Strongly disagree - -
Total 60 100
91
Agree 20 10 8 100 10
Total 60 130
Therefore:
Df = (r 1) (c 1)
= (5 1)(2 1)
= (4)(1)
=4
X2 tabulated = 9.49
92
Decision Rule
calculated, accept the alternative hypothesis (H1) and reject the Null
hypothesis (Ho).
Decision
hypothesis (H1) which state that budgeting and budgeting control is used for
which state that budgeting control is not used for assessing managers budget
is rejected.
HYPOTHESIS IV
actual performance.
research question;
Strongly agree 20 33
Agree 16 27
Undecided 9 15
Disagree 10 17
Strongly disagree 5 8
Total 60 100
Agree 16 10 6 36 3.6
Undecided 19 10 1 1 0.1
Disagree 10 10 0 0 0
Total 60 16.2
Therefore:
Df = (r 1) (c 1)
= (5 1)(2 1)
94
= (4)(1)
=4
X2 tabulated = 9.49
Decision Rule
calculated, accept the alternative hypothesis (H1) and reject the Null
hypothesis (Ho).
Decision
hypothesis (H1) which state that there is connection between the type of
hypothesis (Ho) which state that there is no connection between the type of
CHAPTER FIVE
RECOMMENDATIONS.
from chapter four of the research project and the researcher had to
implementation.
ii. Most of the members of the staff whom the researcher issued
iii. Many members of the staff believe that budget serves as an effective
means of planning
vi. That most of the number of the staff are university graduate.
ix. That budgeting and budgeting control is used for assessing mangers
budget.
5.2 Conclusion
budgeting control in the organization and roles they play toward determining
the cooperate objectives, profit making, one could rightly conclude that it is,
revenue, which in turn will lead to increase in profit. Though budgeting and
performance, it should be noted that it is not magic stick that could replace
The findings of the research shows that when budgets are effectively
performance.
5.3 Recommendations
On the whole, the finding of the study support the conclusion that
performance of an organization.
recommended:
That budget plan and preparation should be cooperate duty of the unit heads
with the head of development in the corporation as the case may be.
That the approval of budget should be made public and should avoid
corruption.
the cooperation because without budgeting well, the corporation will keep
would be impossible.
Constant review and periodic review of the budget at intervals would enable
them to correct deviations, which occurred within the interval before they
get out.
99
BIBLIOGRAPHY
Adams, R. (2009). Public Sector Accounting and Finance Made Simple, (2nd
Edition). Lagos: Cooperate Publishers Venture.
Emeka, A.O. (2008). Public Policy Analysis and Decision Making. Onitsha:
Book Point Educational Limited.
Eze, O., & Agbo, B. (2006). Research Method; (Basic issues and
Methodology). Enugu: Benalice Publication.
APPENDIX
Department of Accountancy,
Caritas University,
Amorji-Nike
Enugu state.
Dear Sir/Madam,
sc degree in Accountancy.
letter by filling the necessary space. The required answers and the
Yours faithfully,
Umeileka Ngozika.
102
QUESTIONNAIRE
Instruction, please read the question carefully and thick any answer
Section A
1. Gender;
a. Male
b. Female
2. Marital Status;
a. Single
b. Married
3. Age
a. Below 18 years
b. 18 29 years
c. 30 39 years
d. 40 49 years
e. Above 50
4. Academic qualification
a. WAEC
b. NCE/OND
103
c. HND/BSC
d. Others
5. Sections/Department
SECTION B
performance.
15.Budget force managers to think about and plan for the future.
17. The budgeting process can uncover potential bitterness before they occur
19. Budget defines goals and objectives that serve as bench mass for
evaluating.