Budgeting As An Instrument Of Administrative Control Of Public Agencies In Nigeria

Budgeting and budgetary control will continue to play a significant role in public organizations in Nigeria, considering the need to compete favorably with other organizations(both public and private) and make sure the organization is a going concern. The main aim of the study is to examine budgeting as an instrument of administrative control of public agencies in Nigeria. This study traces the extent by which budgeting can used as a good planning and controlling tool in Ministry of Finance, Uyo. From the analysis, it is deduced that budgeting aid effective planning and control. It is induced that budgetary controls are used as an instrumental instrument of enhancing organizational performance. Based on the findings of this study and subsequent recommendations, it has been concluded that government budget in Nigeria and its nature are a control device itself which specifies expenditures for projects and expressed in monetary estimates: Types of government budgetary system. If properly adhered to government budgets are the most effective tools for curbing corruption and inculcating discipline in Nigerian society.

Introduction

1.1 Background of the Study

Budgeting and budgetary control will continue to play a significant role in public organizations in Nigeria, considering the need to compete favorably with other organizations (both public and private) and make sure the organization is a going concern, most government agencies have adopted budgets and budgetary control techniques to effectively and efficiently allocate resources and achieve stated goals.

Every Business oriented organization is aimed among other at making profits as high as possible. All efforts, therefore are diversified at effective planning process with a maximum cost involvement in its decision making drive towards achieving the desired objectives, management often provides basic guideline which are quantified in financial terms and it mineral values.

Budgeting is required to achieve many deferent aims within an organization, if not only aid in planning, coordinations and communicating the activities of the organization, but also as a control and motivating devices in the management of the management of the organization.

Budgeting call for effective monitoring and controlled by the head of the organization since budget animates from different sections departments and all the branches of a company which no company is an exception so as to guarantee its reliability and also minimize deviation from plans. Budgeting starts with the setting out of the objectives of the organization by the management for the budget year according to government"s fiscal and monetary guideline and policies. The top management staffs must communicate the policy affect the long term plan to those who are responsible for preparing the current year budget. The manager prepare the minimal budgets for those area for which they are responsible and submit it to their supervisory officer while the budget is examined and summarized into master budget which consists of budgeted profits and loss accounts, balance sheet and the cash statement.

The approval of the master budget constitute authorities of the manager countered in carrying out the plants while are contained in each budget.

For management to provide adequate control over the over the budget of an organization, It should coordinate all the various phrases of the firms activities and the collaboration of the responsible parties in achieving the actual results with budget to establish the variance. It should trace the variances to where it arose so as to control the various effectively.

1.2 Statement of the Problem

The decision as to how to distribute limited financial and nonfinancial resources, in an effective and efficient manner, is an important challenge in all organizations. In government agencies, this task would be nearly impossible without budgeting. Without effective budget analysis and feedback about budgetary problems, many organizations and government agencies would become bankrupt. Some of the problems arise from inadequate data to formulate and implement a proper budget; and non existence of well defined structure, which leads to overlapping of duties. These deficiencies can therefore be addressed through the use of budgeting instrument. Therefore, this study traces the extent by which budgeting can used as a good planning and controlling tool in Ministry of Finance, Uyo.

1.3 Objectives of the Study

The main aim of the study is to examine budgeting as an instrument of administrative control of public agencies in Nigeria. Specific objectives of the study are:

To find out whether budgetary aid effective planning and control in Ministry of Finance, Uyo.

To examine whether budgeting control is used as an instrument of enhancing organizational performance.

To examine whether budgetary control affect the working performance of employees in Ministry of Finance, Uyo.

To determine whether budgetary control has contributed to the success of Ministry of Finance, Uyo.

1.4 Research Questions

Inorder to guide the study and achieve the stated objectives for the study, the following research questions was formulated:

Does budgeting aid effective planning and control in Ministry of Finance, Uyo?

Does budgetary control used as an instrument of enhancing organizational performance?

Has budgetary control contributed success of Ministry of Finance, Uyo?

Does budgetary control affect the working performance of employees of Ministry of Finance, Uyo?

1.5 Research Hypotheses

Hypothesis 1

H0: Budgetary does not aid effective planning and control in Nigeria in Ministry of Finance, Uyo.

Hypothesis 2

H0: Budgetary control does not used as an instrument of enhancing organization.

1.6 Significance of the Study

The addition of knowledge is basically the aim of every research and this research work seeks to achieve just that. More importantly, this research is necessary in understanding how the budgetary control is established, and also how it affects organizational performance.

It is a tool which measures managerial performance of an organization and promotes good morale and harmony in the organization. It enable the organization verify whether or not the plans of the organization are understood by all members, and put into effect corrective measures where deviation or under deviation is occurring.

Since budget is a tool for planning, and financial planning is of almost significance to a business man, it enables the organization project the future consequences of present decisions in order to avoid surprises and understand the link between present and future decision.

1.7 Scope of the Study

The study examines budgeting as an instrument of administrative control of public agencies in Nigeria, using Ministry of Finance, Uyo as a study area.

1.8 Limitation of the Study

The study limitation was inability of management to divulge certain information which they consider sensitive and fear of publication which might be detrimental to their operation.

Distance and its attendant cost of travel in order to obtain information which to write this study was also a major limitation. Another limitation to the study is short time factor which did not give time for thorough research work, hence gathering adequate information becomes very difficult.

Finally, lack of materials on the topic; this is new in the area of budgeting as an instrument of administrative control of public agencies in Nigeria. Therefore, the researcher resolved to seek friendly approach in order to obtain the needed materials or information from the organization under study through the administration of questionnaire.

1.9 Definition of Terms

Budget:

The chartered institute of management Accountants (CIMA) defines budget as "a plan quantified in monetary terms, prepared and approved prior to a defined period usually one year, showing planned income to be generated and expenditure to be incurred during that period, and he capital to be employed to attain that objective.

Budgetary Control:

This is the establishment of a budget relating the responsibilities of executives to the requirements of a policy and the continuous comparison of actual with budgeted results either to secure the individual actions with the objective of that policy or to provide a basis for its revision.

Planning:

This is the establishment of objectives, and the formulation, evaluation and selection of the policies, strategies, tactics, and action required to achieve these objectives.

Control:

This s the process of ensuring that a firm"s activities conform to its plans and that its objectives are achieved.

Variance:

This is the difference between planned (budgeted) and actual results.

Favourable Variance:

This is excess of the budgeted result over the actual result, in the case of cost. But in the case of revenue it is the excess of that result over the budgeted.

Unfavourable Variance:

This is the excess of actual result are the budgeted in terms of cost and viceversa in terms of revenue.

Business:

Any establishment which has profit motive or maximization as its major objectives.

Organization:

All establishment whether government or privately owned

Summary, Conclusion and Recommendations

5.1 Introduction

This chapter presents the summary, conclusion and recommendations for further studies.

5.2 Summary

This study was carried out to examine budgeting as an instrument of administrative control of public agencies in Nigeria. To achieve this objective, the study revealed that:

In table 2 it was discovered that 45 (60%) of the respondents indicates yes that budgeting aid effective planning and control in Ministry of Finance, Uyo while 17 respondents representing 23% indicates no and 13(17%) of the respondents pointed no idea. Based on this analysis, it is deduced that budgeting aid effective planning and control in Ministry of Finance, Uyo.

Table 3 also shows that 40 (53%) of the total respondents pointed yes and 15(20%) respondents opted no, while another 20 respondents representing 27% indicated no idea on the question. From the analysis, it is induced that budgetary control is used as an instrument of enhancing organizational performance.

Table 4 revealed that 50 respondents representing 67% indicate yes that budgetary control contributed success of Ministry of Finance, Uyo. Also, 10 (13%) respondents asserted no while 15 (20%) of the respondents pointed no idea. Based on the analysis, it is deduced that budgetary control contributed to the success of Ministry of Finance, Uyo.
In table 5 it was found out that 18 respondents (24%) pointed yes while 45 (60%) of the respondents indicates no and also 12 respondents representing 16% asserted no idea on the question. From this analysis, is deduced that budgetary control affect the working performance of employees of Ministry of Finance,Uyo.

5.3 Conclusion

Based on the findings of this study and subsequent recommendations, it is concluded that government budget in Nigeria and its nature is a control device itself which specifies expenditures for projects and expressed in monetary estimates: Types of government budgetary system. The government budget can rely on the use of any budgetary systems. Also the function of government budget clearly shows its control posture of government at all levels. If properly adhered to government budgets are the most effective tools for curbing corruption and inculcating discipline in Nigerian society.

5.4 Recommendations

Based on the findings of this research work, the researcher made the following recommendations:

Governments budgets at all levels should be regarded as an effective means ofcontrolling public sector.

Implementation of budgets should be strictly observed in a yearly basis.

One of the lingering issues between executive and legislative arms of government isthe non-implementation of government budgets. There is need to burry this issue soas to create a conducive working environment.

Government budgets should replace people"s needs not elites want.

Budgets are the easiest means of portraying government policy thrusts.

Public policies can be easily identified and implemented through public budgets.

Public budgets and budgetary control should serve as a tool for inter-governmental relations.

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