BUDGETING AND BUGETARY CONTROL TECHNIQUES IN GOVERNMENT PARASTATALS, A STUDY OF OFFICE OF THE SECRETARY OF GOVERNMENT TO THE FEDERATION

BUDGETING AND BUGETARY CONTROL TECHNIQUES IN GOVERNMENT PARASTATALS, A STUDY OF OFFICE OF THE SECRETARY OF GOVERNMENT TO THE FEDERATION

CHAPTER ONE

INTRODUCTION

1.1          Background to the Study

The word ‘budget’ originated from a French word bougette meaning little bag. In Britain, the word was used to describe the leather bag in which the chancellor of the exchanger used to carry to the parliament. The statement of government needs and sources as described by (1). After several thoughts of consensus, the budget became the document contained in the bags which represent plans of government expressed in money and submitted to legislatives for approval.

Government use budgets as a guiding tool for planning and control of its resources, be it financial or otherwise, the use of budget involves knowing how much money you earn and spend over a period, particularly one year. When a budget of an establishment, department or ministry is created, it means creating a plan for spending and saving money. The process of preparing budget requires a call circular to the various departments, establishments, ministry or representatives who are expected to participate in the budget discussion as well as serve as budget committees. The person who heads the budget committee is known as the budget director. The director heads the budget committee and receives departmental or organisational submission for onward transmission to the chairman for authentication and verification. On receipt of the budget submission, the chairman is expected to go through the documents, make any necessary adjustment, correction, medications, additions based on the mission or corporate objectives, and then forward it to the legislative arm of the council as a bill document.

The legislative council reads the budget document carefully discuss every aspect of it, make any amendment if any and send it to the executive for his consent and authentication. Once the executive sign the document, it becomes a legal document to be used for spending and control of money at any tier of government.

The aim of this study is to evaluate budget in the public sector from balanced scorecard perspectives. Towards the purpose, the specific objectives of the study are to investigate how budge performance differs from state to state in Nigeria and to carry out a correlation appraisal surveyed states and response obtained on budget performance of the selected state in Nigeria from years 2000 to 2010.

1.2          Statement of the Study

Over the years’ experience has shown that budgeting has proven ineffective in the public sector as a result of the following problem that prompt the study of these nature in order to find a lasting solution. This is to know whether the problem is as a result of thus:

1.    Lack of qualified and professional budget staff in the public sector organisation

2.    Whether budgeting and budgetary control sustain an improved performance in public sector.

3.    Whether budgeted and actual figure are regularly or not compare for proper accountability.

4.    Whether the independent of the audit is encroached upon.

5.    Whether the impediment enclave by mismanagement on resources pose great defect on the sector.

1.3          The Objectives of the Study

The main objective of this study is to examine how the budgeting process sets the overall goals of the government parastatals as well as the specific goal for individual unit section and department. Other objectives include:

i.              Budgets provide a means of coordinating the activities of the different departments of an organisation so that each aspects of the operation is integrated and pulled in the same direction.

ii.             Budgets provide a means of communicating managements plans to all the staff involved.

iii.            A budget also is a motivating device, with clearly delineated expected results. For the budget period, employees know what is expected of them. This in turn sustains morale and motivates people to work to attain the budgeted goals. The budget of an organisation that employs participative budgeting involving all or most personnel to formulate all or part of it often can further motivate employees to attain the budgeted goals because the employees identify the budget as their own (Blocher, et al. 2002:341).

iv.           The budgeting process compels planning. The budgeting process forces managers to decide in advance “what to do, how to do it, when to do it, and who is to do it” without the necessity to prepare a budget. Many managers would spend all of their time dealing with emergencies.

v.            Budgets define foals and objectives that can serve as bench marks for evaluating the performance of individual departments, divisions or the entire company.    

1.4          Research Question

This seeks to address every important question on budgeting and budgetary control techniques in government parastatals, as thus:

-          Does budgeting and budgetary control sustain an improved performance in the public sector? Yes or No

-          Are there qualified and professional budget staff in public sector organisation? Yes or No

-          Are budget and actual figures regularly compared? Yes or No

-          Mismanagement is one of the main sectors for the non implementation of budget provision in government? Yes or No

-          Budget assists in economic control and growth of government parastatal? Yes or No   

1.5          Research Hypothesis

The following hypothesis was formulated to serve as guidelines for the researcher for the purpose of this study.

-          There are standard institutions responsible for budgeting and budgetary control and monitoring system in government parastatals.

-          There are adequate experience and professional staff to formulate and implement government budgeting policies in Nigeria.

TOPIC: BUDGETING AND BUGETARY CONTROL TECHNIQUES IN GOVERNMENT PARASTATALS, A STUDY OF OFFICE OF THE SECRETARY OF GOVERNMENT TO THE FEDERATION

Chapters: 1 - 5
Delivery: Email

Number of Pages: 65

Price: 3000 NGN

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