BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL (A Case Study of First Bank of Nigeria Plc.)
ABSTRACT
The government is looking to small and medium-sized businesses and entrepreneurs in both developed and developing nations as a way of economic development and a real means of fixing problems. It is a breeding ground for new ideas, technologies, and jobs. Nigeria has a long history of entrepreneurship, which has aided in the expansion of the national economy. SMEs help Nigeria’s economy thrive at the moment, therefore all levels of government have policies that support the expansion and maintenance of SMEs at various points in time.
This article discusses the operational definition and scopes of SME’s and entrepreneurship in Nigeria, as well as the participation, regulation, and facilitation of the Nigerian government both legally and politically in the development of these sectors. It outlines the marketing challenges faced by SMEs and entrepreneurs in Nigeria, as well as the need for and implementation of helpful regulations, infrastructure improvements, ongoing human resource development, direct financial support for SMEs, and the creation of financing institutions to help them. It outlines the contributions made by SMEs to Nigeria’s development and expansion. It covers entrepreneurial ideas, issues, and cutting-edge, effective marketing solutions. It ends by stating unequivocally how important marketing is to SMEs’ and entrepreneurs’ survival.
TABLE OF CONTENT
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
1.2 Statement of the Problems
1.3 Significance of the Study
1.4 Research Hypotheses
1.5 Research Questions
1.6 Method of Data Collection
1.7 Method of Data Analysis
1.8 Scope and Limitations of the Study
1.9 Definition of Terms
1.10 Historical Background of First Bank of Nigeria Plc
CHAPTER TWO
LITERATURE REVIEW
2.1 Introduction
2.2 Techniques for Compiling Budget
2.2.1 Increment Based Budget [IBB]
2.2.2 Zero Based Budgeting (ZBB)
2.2.3 Activities Based Budgeting (ABB)
2.2.4 Programme Planning Budgeting System (PPBS)
2.3 The Budgeting Process
2.4 The Origin of Budget in First Bank of Nig. Plc
2.5 Budget Committee and its Importance
2.5.1 Importance of Budget Committee
2.5.2 The Cooperation of Departmental Head in the Preparation of Budget
2.5.3 The Responsibility of Management in the Preparation of Budget
2.6 Budget Preparation
2.6.1 How Realistic is the Budget
2.6.2 Treatment of Variances
2.7 Branch Office Budget and Management Approval at First Bank Nigeria Plc
2.8 The Importance of the Budget to the Whole Organization
2.9 Effectiveness and Short Comings of Budget
2.9.1 During the Preparation of the Budget
2.9.2 During the Operation of the Budget
2.9.3 During the Comparison of the Budget
2.9.4 How the Shortcoming are Treated
References
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Introduction
3.2 Research Design
3.3 Population of the Stud
3.4 Sample and Sampling Technique
3.5 Method of Data Collection
3.6 Method of Data Analysis
3.7 Scope and Limitation of the Methodology
3.8 Validity and Reliability of Research Instrument
CHAPTER FOUR
DATA ANALYSIS AND INTERPRETATION OF FINDING
4.1 Data Presentation
4.2 Test Hypotheses
4.3 Discussion of Findings
BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL (A Case Study of First Bank of Nigeria Plc.)
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 Summary
5.2 Conclusion
5.3 Recommendations
Reference
Appendix
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
This preface serves as an introduction to the framework supporting the research “Budgeting as a tool of Management Control.” From the very beginning of organization research, the budget has been a crucial instrument for management control.Due to the increasing complexity of the corporate environment and the fierce rivalry in the market, budgeting has become an essential management tool
The management must have a clear vision for the organization’s future state and a plan on how to get there. Thus, creating a set of projections for future costs and revenues in a way that “will coordinate the actions in line with chosen objectives and
1.2 STATEMENT OF PROBLEM- BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL
Research on this topic may run into some issues because budgeting in any business implies future intentions for how the business will be operated. It may be challenging to gain access to some information that the bank may deem to be risky to reveal.The assessment of future plans established with the intention of making decisions is known as budgeting control. Thus, it is important to check that they are the finest in terms of sufficient preparationThe actual result should then be compared with the estimations to determine the discrepancy in order to identify the reason of the variation and the division or department of the bank from which it originatThere might be some issues throughout the procedure.
1.3 SIGNIFICANCE OF STUDY- BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL
Management errors in evaluating and prioritizing budget proposals throughout the course of the year have not gone undetected. It will be easier to achieve the company’s objectives (goals) if they are stated in formal, explicit words to prevent misunderstanding. Additionally, convey expectations to everyone involved in the firm’s management so that they are recognized, embraced, and carried out. They also offer a thorough plan of action for interpreting ambiguity and determining how to best focus individual and group efforts in order to accomplish objectives.
The study is significant in the following ways, too:
Given that it covers practically everything that is necessary for budgeting, it is pertinent to all students of business and other related fields. It may also be used as a resource by anyone getting ready for a pertinent professional test.
This study will also be helpful to bankers since it will act as a guide for their budgeting decisions. Poor budgeting may lead a corporation to become disorganized because it contains plans that are measured in money. Since it will give a workable basis for the evaluation of the profitability of the planned firm, it will be of utmost importance to possible investors, whether they be individuals, corporations, or the government.
In the end, this research activity might lead to new hypotheses that would
1.4 RESEARCH HYPOTHESES- BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL
Two hypotheses concerning investment and financial decisions in the Nigerian economy and how they impact the operation of First Bank of Nigeria plc have been developed in accordance with the study’s objectives and the researcher’s desire in finding answers to the issues at the outset of the investigation.
HYPOTHESIS ONE
Ho: The budgetary method does not provide a benchmark by which to measure the organization’s real performance.
H1: The budgetary system provides a benchmark for measuring the organization’s real performance.
HYPOTHESIS TWO
Ho: Budget as a tool of management control is not necessary in an
organization.
H1: Budget as a tool of management control is necessary in an organization.
1.5 RESEARCH QUESTIONS- BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL
Research questions are the interrogative statements that frequently come up over the course of an investigation and are used to gather data for the investigation. The following research questions will be attempted to be answered in order to fulfill the goal of this research project.
1. Does the budgeting system provide a benchmark by which the organization’s real performance may be determined?
2. Is a budget important for management control in an organization?
3. How does the efficiency and effectiveness of budgeting and budgetary management at a company like First Bank of Nigeria plc relate to the required requirements that must be in place?
4. Is there a connection between an effective budgeting system and a manufacturing organization’s effectiveness?
5. Does budgeting and budgetary control provide a benchmark by which to measure the organization’s real performance?
6. How does First Bank of Nigeria plc’s application of budgeting and budgetary management impact the human element?
7. How much of an impact or influence does the human factor have on the budgeting and budgetary control processes?
1.6 METHOD OF DATA COLLECTION- BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL
Primary and secondary sources will be used to collect the data, including structured questionnaires as well as library searches for pertinent journals, periodicals, newspapers, and books.
1.7 METHOD OF DATA ANALYSIS- BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL
In this study, the data will be analyzed using the descriptive approach, and the chi-square (X2) test will be utilized to test the null hypothesis. The research problem hypothesis, the purpose research questions, the research literature, and other pertinent topics will all be explored in relation to the research study’s findings. There will be findings reached, as well as advice and ideas.
.8 SCOPE AND LIMITATION OF THE STUDY- BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL
Budgeting as a tool of management control does not clearly reflect all the facts behind the project title due to a number of foreseeable restrictions, but the researcher made an attempt to set up this study in a way that it covers the following areas.
The role of the budget committee
Management is accountable for creating the budget.
budgeting for cash preparation
handling of variations
The value of a budget to a whole organization
Managing the budget for a branch office Approval.
The manager responsible for budget development, the level of achievement of budget projections, and the methods of disposal would all be reviewed. The budgeting process of First Bank of Nigeria Plc.
The investigator
In this part, the researcher feels it is crucial to draw attention to a few of the challenges that were faced while doing this study and that the researcher’s goals for information, volume, and educational Hess were hampered by.
It is vital to note that time was a significant constraint on the study since it had to be completed within a very constrained timeframe and, more critically, because the researcher had to balance writing the project with other academic work.
Despite all the limitations described above, this study will be educational, interesting, and valuable to all current and prospective investors, including bankers. Manufacturers, using academic research as insight, setting their own stage
1.9 DEFINITION OF TERMS- BANKING SECTOR IMPACT OF BUDGET AND BUDGETARY CONTROL
1. Budget: A future plan of action or an approved estimate given in both financial and quantitative terms, produced and approved prior to a certain perioad of time of the policy to be pursued in order to accomplish an aim during that period, is what CIMA defines as a budget.
2. Budgeting: This is just the process of creating a comprehensive short-term strategy (budget). It is the process through which the budget’s declared objectives, policies, and policy measures, as well as the requirements, sources, and distribution of funds, are established.
3. Budgetary Control: To put it simply, this refers to the use of a budget or budgets to regulate the organization’s operations and activities. It speaks about the ongoing assessment of a level in relation to the desired outcome so that
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