This research work was focused on investigation on the use of budgeting as a tool for planning and control in topical manufacturing industry like Nigerian breweries plc, Enugu.
The objective of the study is to show the important of budgeting as a tool for planning and control in operation of a manufacture industry which has profit maximization as its principal objective. The research also aims at identifying the procedures adopted in the formulation of annual budgets of Nigerian Breweries plc.
Based on this, the following hypothesis was formulated for the study. The hypothesis include:
Following the investigation and analysasion of the data, the following finding were made:
From the finding, the conclusion were arrived that budgeting is a very essential and indispensable tool for planning and control. It helps management to be well structure in sustaining the growth and expansion of the organization
Business organizations need planning to achieve their aims and objective. It thorough planning in an organization cannot be done without involving the act of budgeting. The management has the purpose of providing a feed – foreword process.
The concept of feed-forward process in to provide each manager with guideline for making operation decision on a day –to- day basic. Budgeting deals with plans and monitoring activities to ascertain whether they conform to the plans. This is the control and coordination aspect of budgeting.
Manufacturing industries can only achieve profit maximization by proper planned use of available resource. This is sustained when different activities are efficiently coordinated, and decisions taken in the organization are result oriented. Business organization requires the use of some techniques in the formula and adoption of planned and defined system and tools with a view to achiever set goals. Such tools and systems include budgetary variance analysis and budgetary control. The process of setting goals to be achieve in the future time and determining how these goals are to be reached is described as PLANING, while the process of translating this planning into financial target can be described as BUDGETING.
Reg, H. Garrison, in his opinion, defined budget, thus, a budget is a detailed plan showing how resources will be require and used over some specify time interval. It repented a plan for the future expressed in a formal qualitative terms. The act of preperating a budget is called budgeting. The use of budget to control a firms activities is known as budgeting control ‘’.
This project is organized in five chapters, which aimed at finding out the budget process used achieving the goals of a typical. Manufacturing, industry with profit maximization as its main objective with center focuses in Nigerian breweries plc Enugu.
Chapter one is an introduction to the study concerning such issues as:
Chapter two present the literature review, which such issues as:
Chapter three presents the reseach design methodology.
The source of data collected for analysis, and treatment of some of the problems encountered during data collected were examined and analysis in detail to enable us draw conclusion there by making recommendation.
Chapter five contains the summary of the resaech, recommendation and conclusion.
STATEMENT OF THE PROBLEM
The management has his primary duty of achieving the objective of profit maximization of the company through budgeting .due to the state of our economy, and government policies, this goal is much hindered during the period of economic depression which features low capacity utilization, high interest rate shortage of foreign exchange to buy the needed, raw material. Management is filed with the problem of how to make use of available scarce resources your order to achieve the objective of profile maximization. This reseach work is intended to help in dertermingand highlighting the problems that militate against the application and utilization of budgeting as a tool for planning and control in a manufacturing industry The research work will provide solution of the following problems.
(1) Inability of the manufacting company objectives
(2) Insufficient appraisal of the company performance base on budgeting.
(3) Inability of officers in the cost centers to conform to guild line and attain the standard set in the organization. This is applicable to all workers
(4) Inadequate monitory of compliance with and deviation from department and entire budgets.
PURPOSE OF THE STUDY
The purpose of this study includes the following: -
STATEMENT OF HYPOTHESIS
The following are the basic for reseach in this study:
HI: Managers are using budgeting in planning and controlling the the business resources
HO: mangers are not using budging in planning and controlling the business resource.
HI: budgeting is a tool for effective decision making in manufacturing industry.
HI: utilizations of resource is achieved with the use of budgeting and budgetary control
HO: utilization of resource is not achieved e with the use of budgeting and budgetary control.
SCOPES AND LIMITATION OF THE STUDY
The study of budgeting as a tool for planning and control in a manufacturing industry has its scope limited to Nigerian Breweries (NBL) PLC Enugu due to various constraints.
Among the major constraints is the fear of job security by some staff of the company might be unsafe if they grant interviews.
Again funds available to the researcher and cost of printing the questionnaire to and from the respondents.
Moreover there was retaining of time so as to come other course within the limited time.
SIGNIFICANCE OF THE STUDY
In the business world the main objective is to maximize profit by providing goods and services of fair, comparative, and affordable prices no management can ignore profit maximization unless it will be stifled out of business.
Hence, this study is significant with the following reason:
DEFINITION OF TERMS
The institution of cost and management accountants define budget as a plan quantified in monetary terms, prepared and approved prior to a define period usually showing planning income to be generated and or expenditure to be incurred during that period and the capital to be employed to attain that objective.
This is the different between planned (budgeted) and actual result (cost). This may be favorable where actual cost is less than a standard (budget) cost. If it unfavorable where actual cost is greater than standard (budgeted) cost. Alternative terms are MINUS OR PLUS variances, respectively.
This is all establishments whether government or privately owned.
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