BUDGETARY CONTROLS AND MANAGEMENT EFFECTIVENESS IN ORGANISATIONS: A Study of Selected Firms in Port Harcourt

Reference code: C032

ABSTRACT

This study examined the relationship between budgetary control measures and managerial effectiveness in business organisations in Port Harcourt. In order to achieve the objectives of the study, one hypothesis was formulated and data collected through the issue of 72 questionnaires out of which 60 were correctly completed and returned. The data collected was analysed using Pearson Correlation and Statistical Package for Social Sciences (SPSS). Following the data analyses, the following findings were made: there is a significant and positive relationship between budgetary control measures and management effectiveness. The implication of this finding is that as the firm introduces budgetary control measures, management becomes more effective, budgetary control system is an important tool for planning, controlling and coordination the activities in an organization thereby contributing to achieve a higher standard of performance. We concluded that: it is quite necessary for organisations to introduce stringent budgetary control measures in their organisation. We also conclude that management effectiveness will be better achieved when organisations implement good budgetary control measures. Finally, we recommend that: Budgetary control should be the main concern in organizations amongst other control techniques as this will help the organisation in achieving set objectives. The researcher recommends that organizations that desire higher performance must implement and adhere to budgets and budgetary control.

INTRODUCTION

............. Wants are numerous while resources are limited but there is every tendency to waste or under-utilise the limited resources by the human factor involved in the production of goods and services. With various companies competing with one another, only few that are able to produce at least possible cost will survive the growing competition in the market. Therefore, it is paramount for every serious business undertaken to produce at that possible minimum cost so as to remain in business and also achieve the corporate objectives of profitability and stability.
In view of this, there is every need to do a realistic planning of the activities of the firm taking into consideration the limiting factors and the long term objectives of the firm. In order to achieve this, budgeting – a tool of planning and control becomes indispensable. Budgeting is ubiquitous and has long been considered as a necessary tool in managing a company.
A budget has been defined by Chartered Institute of Management Accountants (CIMA), as “a financial or qualitative statement prepared and approved prior to a defined period of time for the purpose of attaining a given objective. It may include income, expenditure and the employment of capital”. CIMA also defined budgetary control as “the establishment of budgets relating the responsibilities of executives to the requirements of a policy and the continuous comparisons of actual with budgeted results, either to secure by individual action the objectives of that policy or to provide a basis for its revision.
Horngreen (1982) defined a budget as “a quantitative expression of a plan of action and an aid to coordination and implementation”. The Oxford Advanced Learners? dictionary defined budget as an estimate or plan of the money available to somebody and how it will be spent over a period of time.
Both Horngreen and the dictionary emphasised the word plan, but planning itself is found in all aspect of human endeavour, hence planning is a blue print of business growth and a road map for development that helps in ..............
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89 Pages

TABLE OF CONTENT

CHAPTER ONE: INTRODUCTION
1.1 BACKGROUND OF THE STUDY  
1.2 STATEMENT OF THE PROBLEM  
1.3 PURPOSE OF THE STUDY  
1.4 RESEARCH QUESTIONS  
1.5 RESEARCH HYPOTHESES  
1.6 SIGNIFICANCE OF THE STUDY
1.7 SCOPE OF THE STUDY  
1.8 LIMITATION OF THE STUDY
1.9 DEFINITION OF TERMS  
1.10 ORGANIZATION OF THE STUDY    
REFERENCES


CHAPTER TWO:  LITERATURE REVIEW
2.0 INTRODUCTION
2.1 CONCEPT OF MANAGEMENT CONTROL
2.2 THE BUDGET
2.2.1 Characteristics of a Budget
2.2.2 Types of Budget
2.3 PREPARATION OF BUDGET & BUDGETARY CONTROLS
2.3.1 The Budget Cycle
2.3.2 The Budget Period
2.3.3 Purposes of Budget Preparation
2.3.4 Budgetary Controls  
2.4 THE BUDGET AS A TOOL FOR MEASURING FINANCIAL PERFORMANCE
2.5.1 BENEFITS OF A BUDGET
2.5.2 CHALLENGES OF A BUDGET
2.6 CRITERIA FOR MEASURING BUDGET PERFORMANCE
REFERENCES

CHAPTER THREE: RESEARCH METHODOLOGY
3.1 INTRODUCTION
3.2 RESEARCH DESIGN  
3.3 POPULATION OF STUDY
3.4 SAMPLE SIZE AND SAMPLING TECHNIQUE
3.5 SOURCES OF DATA
3.5.1 INSTRUMENTS FOR DATA COLLECTION
3.5.3 VALIDITY AND RELIABILITY OF INSTRUMENTS
3.5.4 ADMINISTRATION OF INSTRUMENTS
3.6 METHOD OF DATA ANALYSIS
3.7.1 CORRELATION
REFERENCES

CHAPTER FOUR: DATA PRESENTATION AND ANALYSES
4.1 INTRODUCTION
4.2 DATA PRESENTATION
4.3 HYPOTHESIS TESTING

CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 INTRODUCTION  
5.2 SUMMARY OF FINDINGS
5.3 CONCLUSION
5.4 RECOMMENDATIONS
BIBLIOGRAPHY

CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS
4.0 INTRODUCTION
4.1 DATA PRESENTATION
4.2 DATA ANALYSIS
4.3 TESTING OF HYPOTHESES
4.4 DISCUSSION OF FINDINGS

CHAPTER FIVE: SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
5.1 SUMMARY OF FINDINGS
5.2 CONCLUSION
5.3 RECOMMENDATIONS
REFERENCES
APPENDIX

89 Pages

Reference code: C032

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