BUDGETING AND BUDGETARY CONTROL IN AN ORGANISATION

By

OGHARANDUKUN JULIET

Presented To

Department of Accountancy

TITLE PAGE II

APPROVAL PAGE III

DEDICATION IV

ACKNOWLEDGEMENT V

TABLE OF CONTENTS VII

CHAPTER ONE

INTRODUCTION OF BUDGET 1

DEFINITION 1

DEFINITION OF BUDGETING CONTROL 2

TYPES OF BUDGET 2

LIMITATION OF STUDY 3

CHAPTER TWO

OBJECTIVES OF BUDGET AND

BUDGETING CONTROL 6

THE USES OF BUDGETING CONTROL 9

ADMINISTRATION OF BUDGETING CONTROL 10

PREPARATION OF BUDGET 12

FORMS OF BUDGET 14

THE BUDGET PERIOD 16

REQUIREMENT FOR AN EFFECTIVE BUDGET 17

CHAPTER THREE

SYSTEM INVESTIGATION AND ANALYSIS 21

PRIMARY DATA COLLECTION 22

SECONDARY DATA COLLECTION 22

INTERVIEN METHOD 22

RECOMMENDATION AND CONCLUSION 22

BIBLIOGRAPHY 24

CHAPTER ONE

INTRODUCTION OF BUDGET

DEFINITION:

The budget is the housekeeping account of the government, which is normally presented to the legislature once a year. It is also commonly understood as the forecast by a government of its expenditure and revenue for a specific period of time. In public finance the period covered by a budget is usually a year known as a financial year or a fiscal year. The word '' BUDGET'' is derived from old French called ''BUDGETTE'' which means little BAG. Originally this was the money bag or the public purse which served as a receptable for revenue and expenditure of the state.

In Britain the term was used to describe the leather bag in which the chancellor of the exchequer carried to parliament the statement of government need and resources. Eventually the term come to mean the document which were contained in the bag namely. The plans of government financial submitted for the approval of the legislature.

Thus when the British chancellor of the exchanger makes his annual financial statement he said to ''open'' his budget.

A budget is not just a matter of finance in narrow sense.

Budgeting process itself, is a pivot point in studying the on going planning and control activities of an organization.

DEFINITON OF BUDGETING CONTROL

Budgeting control can be defined as '' the establishment of departmental budget relating the responsibilities of executive to the requirement of a policy, and the continues companision of actual with budgeted result, either to secure by individual action the objective of that policy or to provide a basic for its rension (CIMA).

TYPE OF BUDGET

1. DEFICIT BUDGET

A budget deficit occurs when the expenditure of the government exceeds its revenue for a given fiscal year under consideration. In order to make up for the deficit, the government has to draw its reserves or it may borrow to meet its financial obligation

2. SURPLUS BUDGET

the government operates a surplus budget when its anticipated revenue is more than its anticipated spending for a given fiscal year. The surplus fund of the government is transferred to the reserve account or invested in the money and capital markets.

SOME BUDGETARY CONCEPTS

1. RECURRENT REVENUES.

These are fund received by the government yearly by means of taxes, fines, and fees e.t.c.

2. RECURRENT EXPENDITURES:

These are expenditure on running costs of governments like salaries and wages, and interest on public debt.

LIMITATION OF STUDY

The study was restricted to only one branch of bottling company and reliance was high on oral interview with the branch manager which most of the internal substantial ling document especially information were treated as highly confidential.

PREAMBLE

The management of coca-cola Nigeria plc is aware of its responsibility hence the application of budgeting and budgeting control is an annual offer. 47 years of successful operations. It has about 200 branches to its credit and adopts a decentralized structure for effective co-ordination. For the purpose of this study. I shall focus on the line function.

Executive director (operational manager)

Four regional controller (deputy general manager)

Seven area manager (area officers)

200 Network of branches each equipment with a responsibility manager and subordinate (see the organizational chart figure 1)

STRATEGIC PLANS AND MISSION STATEMENT

The strategic plan of coca-cola bottling company focuses on the long-term commitment of resources and the mission statement usually stimulates the long-term perspective and the combination factors.