Budgetary Planning and Control as a Tool for Increasing Productivity
Budgetary Planning And Control As A Tool For Increasing Productivity (A Case Study Of Anamco Emenu Enugu)
This study is to find out how budgeting control and planning help to increase productivity in Anamco Emene. To gain this project work, four (4) research question. Wee formulated. A review of literature was done to ensure solid conclusion for the study. A structured questionnaire was developed and administered by the researcher to sixty two (62) staff made up of junior and senior staff of Anamco Emene Enugu. Table analysis where data was decoded into mean and standard deviation was used for research questions. Based on major findings of the research, conclusions wee drown and recommendation made to elicit the problems associated with the topic under study.
1.1 BACKGROUND OF THE STUDY
The growing complexity of the business environment and the ever-increasing competition among firms in the modern time, make planning/budgeting an invaluable tool for business success.
Successful management is no longer just a matter of flair, skill and determination, a conscious effort is needed to harness available resources towards the achievements of enterprise objectives. Therefore budgeting is one of the tools adopted by management for effective cost planning, control and increase productivity.
In this study, we are going to find out how budget and budgetary control enhance the management of a firm to increase productivity and reduce cost of production. Additionally, since budgeting is a formal expression of managerial plans n quantitative and financial terms encompassing different phases of assisting management in attaining the organizational objective, we are going to verify some limitations of problems associated with budget and budgetary control and how to tackle them and also how the management of Anamco Nigeria Ltd has utilize budget and budgetary control to achieve the organizational objective, increase productivity and reduce cost of production. In most case, some of the problems, which they encounter, includes that there is no efficient support and involvement of all level of management in decision-making. And also the organization is not able to develop meaningful forecast and plans especially the sales plan in making sales budget.
In addition to this they are unable to educate all individuals to be involved in the budgeting process and gaining their full participation. They cannot apply the budgeting system in a flexible manner, including that some organization cannot maintain effective follow up procedure and adapting the budgeting system when ever the circumstance changes. All the above mention facts are some problems to be discussed in this study and ways of solving them, it will also be discussed including suggestions for further researches in the same topic will also be highlighted.
1.2 STATEMENT OF PROBLEM
The study entitled budget and budgetary control a tool for increasing productivity attempt to determine the way by which some organization or firm especially Anamco Ltd Emene has utilize budget and budgetary control to increase their productivity.
Some of the problems, which they encounter, are as follows;
1. Lack of support and involvement of all levels of management
2. Inabilities to develop meaningful forecast and plans, especially the sales plan.
3. Inability to educate all individuals to be involved in the budgeting process and gaining their full participation.
4. Most organization or firms are unable to apply the budgeting system in a flexible manner.
1.3 PURPOSE/OBJECTIVE OF THE STUDY
The purposes of this study are as follows:-
1. To determine how lack of support and involvement of all levels of management distort budgeting.
2. To find out how inability to develop meaningful forecast and plans especially the sales brings about or prevents increase in productivity through budgeting.
3. To establish how inability to educate all individual to be involve in the budgeting process and gaining their full participation brings about problem in budgeting process.
4. To ascertain the extent by which most organization or firm are unable to apply the budgeting system in a flexible manner.
1.4 Research Question
1.Does lack of support and involvement of all levels of management distort budgeting.
2.Does inability to develop meaningful forecast and plans especially the sales brings about or prevents increase in productivity through budgeting.
3.Does how inability to educate all individual to be involve in the budgeting process and gaining their full participation brings about problem in budgeting process.
4.Are there any extent by which most organization or firm are unable to apply the budgeting system in a flexible manner
1.5 RESEARCH HYPOTHESIS
In this work, the following hypotheses are formulated:
1.Budgetary control increases the profitability of business organization.
2.Budgetary control helps to achieve a profit plan.
3.Budgetary control impacts business performance positively
1.6 SCOPE AND LIMITATIONS OF THE STUDY
The research covers ANAMCO EMENU ENUGU.
Some difficulties were encountered in the course of obtaining the necessary information. For instance, the problem of picking the three Business organizations for case study in this project work was not a small one. Also, on numerous occasions, it was impossible to get in touch with the officers who should supply the needed information.
Moreover, when these staff were reached, it was sometimes impossible to obtain the needed data which most of the officers in these company considered as being very confidential. The huge financial implication as regards my case – studying three related business organizations was also a constraint.
Obviously, all these problems had some effect on the information collected and probably, the conclusions reached.
1.7 SIGNIFICANCE OF THE STUDY
There is presently a high incidence of Industrial failure due to world-wide economic recession. For a country like Nigeria, the problem has become a daunting one. The pegging of exchange and interest rates are invariably increasing the cost of operation of these three related Business organizations, hence decreasing their profit.
Therefore, it is very necessary for every organization to plan its expenditure and ensure costs and still operate profitably in terms of having a return over and above cost of operation. It is the determination of the contribution of budgetary control in this regard that comprises the significance of this study.
1.8 OPERATIONAL DEFINITION OF TERMS
The following operational variables are defined in the context of this research study:
Budget: It is an economic plan, quantified in respect of a period of time, which related an organization’s operating ability and objectives with its financial resources;
Budgetary Control: This is the process of controlling performance and costs by setting target, measuring performance, apportioning responsibilities for costs as shown in budget statement and reports and acting upon deviations from plan.
Profitability: This is the state of minimization of costs or the realization of some returns over and above costs in relation to a company.
An Organization: Is a group of individuals working together to achieve some specified goals.
An Industry: Is a firm that concentrated in the manufacturing of different items or it is a branch of trade contrasted with distribution and commerce.
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