Budget As A Tool For Efficient Corporate Performance

The main objective of this study is to examine budget as a tool for efficient corporate performance in Akwa Savings and Loans Limited. The population for this study was staff of Akwata savings and loans limited. A total of 134 respondents were selected from the population figure out of which the sample size was determined. The primary source of data collected was mainly the use of a structured questionnaire which was designed to elicit information on budget. Data collected will be analyzed using frequency table, percentage and mean score analysis while the nonparametric statistical test (Chi-square) was used to test the formulated hypothesis using SPSS (statistical package for social sciences). The study might show the effects of budget information to the cooperation and possibly the remedies and the impact it generate on these remedy to effect of the society in general. The study also investigates and evaluates budgetary control measures in Nigeria i.e shell cooperation to its regards. This research design provides a quick efficient and accurate means of assessing information about a population of interest.

Introduction

1.1 Background of the Study

Today the important of budget and budgetary control can never be over emphasized. Thus for survival of any oil cooperation, management need to embark on budget to effect proper planning and control. In this view, budgeting can be seen as a process of planning and control. Proper budgeting can never affect efficient plans of an organization without control. Control as it were is an important tool which must be priced to keep in check with the plans of the firms and for correction of any deviation from the stipulated plan of the organization in question. Hence a budgetary control comprises of both plan of operation with the scope of the plan. In pursuit to this, data were collected from journals and related works. In consequent writings it reviews the response of people and it was made known through questionnaires that the factors that affect the company"s profitability most in general economic conditions in the contrary as the people stated that cash budget is the best type of budget. For any cooperation such as multi-national oil company i.e. shell cooperation, would want to succeed it business executives must make use of budgetary control measure to avoid failure in business.

They are different classes and types of budget for different entities i.e. fixed budget, Flexible budget, Master budget, Zero budget and annual budget for government entities. It should be observed that whatever the class or structure of a budget they are used for maximizing managerial efficiency and also to ensure that the activities of the cooperation are not left to chance. In organization the introduction of budget and budgetary control systems compels members of the cooperation from the top hierarchy to the bottom to plan ahead this is undoubtedly paramount owing to the higher level of uncertainty facing present day managers and accountant. Budgets formulate expected performance andexpress managerial target which gives meaning and direction to the operation in an organization. Budgets are established to guide action within a defined period. At the end of the period the actual result are compared with the budgetary performance, any discrepancies otherwise known as variance is analyzed for the purpose of showing the cause of such discrepancy and initially informed decision to prevent re-occurrence.

These variance that could be favorable are of importance to the day-to-day existence of any organization.
A budget is an agreed plan of action used to provide directions and coordination giving more structure to any organization as well as motivation of staff to achieve it basic objective performance management is described as the process of quantifying the efficiency and effectiveness of an action. To achieve performance manager or top executives have to be in control.

Types of Control arm referring to are

Financial control

Budgetary control

However, the study tends to examine budget as a tool for efficient corporate performance in Akwa Saving and Loans Limited.

1.2 Statement of the Problem

Budget is a managerial aid to planning and controlling the operations of any cooperation, such as planning and controlling involve forecasting into the unforeseeable future an attempt to ensure that the organization is sustained, virtually in all organization managers and executives assumes managerial role of planning and controlling their operation with the use of budgeting techniques which enables them to stand the test of competition among other industries.

For these reason the researcher has carefully observed that the following problem would emerge in an organization and some of these problems arises from the following;

Budgetary control can be seen as pressure device imposed by management to attain its objectives thus resulting toBad labour relations.

Inaccurate record keeping.

Departmental conflicts arises fromDisputes over resource allocation method.

Department blaming each other if targeted objectives are not being attained.

Conflicting objectives.

It"s difficult to reconcile personnel and individual cooperate goal.

Waste arises as managers adopt the view we had better spend it or we will lose it. This sometimes compelled with entire building in order to enhance the prestige of a department.

Managers may over estimate cost so that they will not be blamed in the future, should they over spend.

Organization activities will be characterized by planlessness event will be left to chance and the entire organization would lose directions which could result to organizational inefficiency.

They will be no yard-stick against which actual result can be measured and this management will be tempted to the complacent with any level of performance.

Activities will be sectional and unintegrated, they will be tendency for every part of the organization to formulate it own objectives, strategies and policies which will not in any long-term achieve the entire organization purpose, mission and objectives.

1.3 Objectives of the Study

The main objective of this study is to examine budget as a tool for efficient corporate performance in Akwa Savings and Loans Limited.

Specific objectives include;

To investigate concisely the budgetary control of shell as a cooperation with the view of determining their efficacy in the managerial process of the company.

To find out the extent of use of budgeting as a tool for its managerial planning and control process.

To find out how budgeting is help in coordinating the activity of various department in the company.

1.4 Research Questions

How can budgetary control system be used to predict concisely the operations of the company and determining the efficacy of managerial process.

How far has budgeting control system used as a tool for managerial planning and control process in extracting industry.

How can budgeting control system coordinate the various activities of extracting industry thereby securing its operations?

1.5 Research Hypotheses

The objectives of the study are to find out if persistent deviation of actual expenditure from budgeted expenditure constitutes inefficiency for the above purpose. The following hypothesis can be formulated;

Hypothesis One

H0: Budgeting control system is a not tool be used to predict conciselythe operations of the company and determining the efficacy of its operations.

H1: Budgeting control system is a tool used to predict concisely theoperations of the company and determining the efficacy of its operation.

Hypothesis Two

H0: Budgeting control system cannot improve managerial planning and control process of the firm.

H1: Budgeting control system can improve managerial planning and control process of the firm.

Hypothesis Three

H0: Budgeting control systems do not coordinate the various activities of the organizational operations and securing it.

H1: Budgeting control system coordinates the various activities of theorganizational operations and securing it.

1.6 Significance of the Study

It can be beneficial for the researcher that the study will be of the following;

That the management of shell Petroleum Company in Nigeria is aiding them to policies, the planning and controlling aspect of managerial function will be clearly stated and understood as it is applicable to the cooperation for better achievement of its objectives.

That other cooperate individuals, agents, accountant, businessmen and women, government parastatal, and scholars who may be interested in these form of budgetary system of aforementioned company might make an objective use of it.

The study might show the effects of budget information"s to the cooperation and possibly the remedies and the impact it generate on these remedy to effect of the society in general.

The research work also gives a long way in increasingly the knowledge of students studying budget control system.

1.7 Scope of Study

The scope of the study is as follows

The study is basically restricted to 2001-2005 operating and capital expenditure budget of entering shell cooperation.

The analysis made in this study was based on data made available to the researcher by the company"s staff and head of department and top executives of the firm in response to the researchers question that were administered.

The scope of theses study can only be limited to budgetary control system of shell cooperation in Nigeria.

The study also investigates and evaluates budgetary control measures in Nigeria i.e shell cooperation to its regards.

Summary, Conclusion and Recommendations

5.1 Summary of Findings

The purpose of this study was to examine the budget as a tool for efficient corporate performance in Akwa savings and loans limited

Hypotheses were formulated (generated) to guide the researcher.

Hypothesis One

H0: Budgeting control system is a not tool be used to predict conciselyoperations of the company and determining the efficacy of its operations.

H1: Budgeting control system is a tool used to predict concisely theoperations of the company and determining the efficacy of its operation.

Hypothesis Two

H0: Budgeting control system cannot improve managerial planning andcontrol process of the firm.

H1: Budgeting control system can improve managerial planning andcontrol process of the firm.

Hypothesis Three

H0: Budgeting control systems do not coordinate the variousactivities of the organizational operations and securing it.

H1: Budgeting control system coordinates the various activities of theorganizational operations and securing it.

The objectives of the study were to;

To investigate concisely the budgetary control of shell as a cooperation with the view of determining their efficacy in the managerial process of the company.

To find out the extent of use of budgeting as a tool for its managerial planning and control process.

To find out how budgeting is help in coordinating the activity of various department in the company.

5.2 Conclusion

Control as it were is an important tool which must be priced to keep in check with the plans of the firms and for correction of any deviation from the stipulated plan of the organization in question. Hence a budgetary control comprises of both plan of operation with the scope of the plan. In pursuit to this, data were collected from journals and related works. In consequent writings it reviews the response of people and it was made known through questionnaires that the factors that affect the company"s profitability most in general economic conditions in the contrary as the people stated that cash budget is the best type of budget. For any cooperation such as multi-national oil company i.e. shell cooperation, would want to succeed it business executives must make use of budgetary control measure to avoid failure in business.

They are different classes and types of budget for different entities i.e. fixed budget, Flexible budget, Master budget, Zero budget and annual budget for government entities. It should be observed that whatever the class or structure of a budget they are used for maximizing managerial efficiency and also to ensure that the activities of the cooperation are not left to chance. In organization the introduction of budget and budgetary control systems compels members of the cooperation from the top hierarchy to the bottom to plan ahead this is undoubtedly paramount owing to the higher level of uncertainty facing present day managers and accountant.

5.3 Recommendations

The study recommended that the government should allocate enough funds for police force unit so that they can implement their activities efficiently and effectively.

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