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PROJECT TOPIC- ROLE OF BUDGETING IN GOVERNMENT PARASTATALS ACCOUNTABILITY (A CASE STUDY OF ENUGU STATE HOUSING DEVELOPMENT AUTHORITY)

PROJECT TOPIC- ROLE OF BUDGETING IN GOVERNMENT PARASTATALS ACCOUNTABILITY (A CASE STUDY OF ENUGU STATE HOUSING DEVELOPMENT AUTHORITY)

 

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.

CHAPTER ONE
INTRODUCTION

1.1 BACKGROUND OF THE STUDY

This project 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.
Enugu State Housing Development Authority a Historical Background
The history of Enugu State Housing Development Authority started in the days of East Central State Housing Development Corporation that was established in 1971; by Ajei Ukpabi Asika’s administration.
It was charged with the responsibility of building houses and estates to be used for both industrial and residential purposes.
However, following the creation of states by the then Murtala Mohammed government in 1976, the corporation was renamed Anambra State Housing Development Corporation owing to the splitting of East Central State to Anambra and Imo States.
In 1991, the government of Ibrahim Babangida once again created Enugu State from the Old Anambra State thus changing the name once again to the present Enugu State Housing Development Corporation.
The corporation began its operation by utilizing the premises and facilities of the old East Central State and Anambra State Housing Development corporation, while the present staff were made up of employees of former corporation of Enugu State origin and new employees.

PROJECT TOPIC- ROLE OF BUDGETING IN GOVERNMENT PARASTATALS ACCOUNTABILITY (A CASE STUDY OF ENUGU STATE HOUSING DEVELOPMENT AUTHORITY)

Organizational Structure

The corporation followed the line and staff method of organization. It shows who performs the actual functions of the organization and those that performs the support or auxiliary function.
Line functions are those who performs the functions as plan, layout, location and actual construction of the buildings while the support functions are those who do the other administrative function, like, personnel department, public relation departments etc.
Edict No. 10, of 1991, clearly established the corporation and stipulates the functions of the board in section 5 which is the governing body of the corporation and shall in its capacity, manage the corporation, Exercise all the functions and powers of the corporation, and perform all other business functions as relate tot he edict.

1.2 STATEMENT OF PROBLEM

The success of any business organization rest upon its ability to adopt a well organized budgeting and budgetary control system.
Lack of budgeting system in planning and controlling has resulted in indiscriminate spending of scarce funds meant for use in viable projects and activities. The results in many problems for many organizations which include;
1.Inability of the company to plan and accomplish goals which can be traced to their inability to apply controls and accountability in the budgeting system.
2.Budgeting goals are not fully realized due to low level of understanding of middle and low level managements.
3.Improper accountability of past jobs performed has resulted in management not being able to use past information to make proper and accurate budget for the future which leads to ineffectiveness and inefficiency.
4.Improper coordination of various cost centres and information on job progress are delayed and this results in delay of prompt management decisions.

1.3 OBJECTIVES OF THE STUDY

The primary purpose of this study are:
1.To find out the role of budgeting and budgetary control in government parastatals.
2.To find out whether there is a relationship between budgetary implementation and their actual performance.
3.To determine whether budgetary control as a management tool contribute to efficiency and effectiveness of management productivity.
4.To find out whether budgetary control can be used in assessing management budgeting accountability.

1.4 RESEARCH QUESTIONS

The following questions will be addressed in this study.
1.What role do budgeting and budgetary control play in your organization?
2.To what extent do budget implementation and their actual performance relates?
3.To what extent does budgetary control enhances management productivity?
4.What are the significant relationship between budgeting control and management accountability?

PROJECT TOPIC- ROLE OF BUDGETING IN GOVERNMENT PARASTATALS ACCOUNTABILITY (A CASE STUDY OF ENUGU STATE HOUSING DEVELOPMENT AUTHORITY)

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