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THE ROLE OF BUDGETING IN GOVERNMENT PARASTATALS ACCOUNTABILITY

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ABSTRACT

The aim of this project is to address the role of budgeting in government parastatals accountability in Enugu State Housing Development Authority. It stresses the usefulness of budgeting and budgeting controls in government accountability. The major problems is the inability of organizations to plan and accomplish goals which can be traced to their inability to apply controls and accountability in the budgeting system. The researcher uses both primary and secondary data but reliance was placed more on primary data because of its relative factual nature.

They include personal observation, interviews, questionnaire, about 60 personnel of the organization were interviewed and their responses analysed by simple percentage. The major findings reveals that there is a great degree of relationship between budgetary implementation and their actual performance. This lack or no implementation of the budget hinders the
achievement of the organizational goal. Budgetary control also as a management tool contributes to efficiency and effectiveness of management productivity.

The researcher based on these findings proposes many recommendations. Which include educating the other levels of management on the
importance of adhering strictly on the provisions of the budgets and implement it as such. The organization should adopt technique that is easy to implement which include flexible and zero based budgeting techniques. The researcher concluded that when budget are effectively implemented at all levels, it will become an essential standard in ensuring actual performance.

Read Also: THE ROLE OF BUDGETING IN THE MANAGEMENT OF PUBLIC INSTITUTIONS 

CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY

This study addresses the role of budgeting as a tool for accountability in government parastatals in Enugu State Housing Development Authority. This is not intended to be a complete work on all budgeting system; rather it stresses on the usefulness of budgets in promoting accountability in government parastatals. Like every other parastatals, Enugu State Housing Development Authority is fast growing, hence the need for accountability becomes necessary with the use of budgeting.
Budgeting system is the process involved in using the scarce resources to achieve the desired goals and objectives of the corporation (Ikpe and Oba, 2004:66).

Budget is also seen as a financial or quantity statement prepared and approved prior to a defined period for the process
of attaining a given goal or objectives. It may include income, expenditure and employment of capital (ICMA; 2008). Therefore in order to achieve these objectives, the organization must deploy the economic resources and discover the means of achieving these goals. These goals can only be realized when the properly planned use of available resources are controlled and coordinated effectively.

Thus the system of managing a business by making a forecast of different activities imperative.
These forecast are guided by the formulation and adoption of planned systems such as techniques in budgeting variance analysis etc. Budgets may be prepared for the firm as a whole
or smaller units like departments, operations like production and sales, financial and resource items like personnel, purchase, cash and capital expenditure etc. Budgetary control at same time is a system of controlling cost through the preparation of budget coordinating departments,establishing responsibilities, relating the responsibilities of the executives to the requirements of a policy. It entails comparism of actual performance with the budgeted
and ensuring that the remedial actions are taken promptly to achieve organizational objectives.

It is therefore germane to say that the level of importance that is attached to these plan and effort made in controlling the variance differ in organizations once goals are set which must be based on the detailed analysis of feasibility within the content of political and social values and the financial plans will be enable to strive towards its attainment. Often than not when these plans are put into operation, condition prevails which tends to cause deviation to the plan and
corrective controls and measures are always taken to steer the business back on the right track.

The process already mentioned as it is applied entails budgets and its control. And to lend credence to goal congruence, suitable techniques should be applied to specific areas needs. Special attention, hence the measurement of budgeted with actual to arrive at variance cannot be over emphasis. A business is said to be on the right track; if the outcome of budgeted estimates is favourable as against the actual.

 

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