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 SIGNIFICANCE OF THE STUDY
The importance or significance of this study is that most organization or firms are unable to increase their productivity through budgeting because the top managers do not support the budgeting process, therefore this study will assist all levels of management to involve and support the budgeting process. Thereby compelling the managers to plan for the future because budgeting process make management to look a head and become more effective and efficient in administering the business operations, including self evaluation and indicates the progress in attaining the objectives of the firm.
The enterprise objectives, budget goals, plans, responsibilities, and procedures for implementing plans are clearly written and communicated through the budget and this will help to improve understanding and harmony between manager and their subordinate. The above mention points or details are the importance or the significance of his study.
1. RESEARCH QUESTIONS
The research questions of this study are as follows:-
1. To what extent does lack of support and involvement of all levels of management distorts budgeting?
2. To what extent does inability to develop meaningful forecast and plans especially sales plan prevents increase in productivity through budgeting?
3. To what extent does 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 what extent does most organization or firms are unable to apply the budgeting system in a flexible manner?
5. SCOPE OF STUDY
For the purpose of this study, the researcher will restrict her to the budgetary planning and control as a tool fro increasing productivity using Anamco Emene as case study.
Also the time allowed for this research was too short considering a broad area.
1.7 DEFINITION OF TERMS
BUDGET: According to the advanced learner dictionary of current English budget means. The money that is available to a person or an organization and a plan of how it will be spent over a period of time, usually monthly or annually.
PLANNING: This is the power to make decisions about how the organization production.
MANAGEMENT: The act of running and controlling a business or similar organization.
COST: The amount of money that company need in order to buy goods or raw materials.
CAPITAL: A large amount of money that is invested the business.
PROFIT: The money that you make in business or by selling things especially after paying the costs involved.
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