LITERATURE REVIEW

The preceding heading in this chapter provides insight into the Budgetary control in a non profit making organization as it affects National cereal research institute (NCRI) badeggi; also as a focus of discussion, the historical background the organization structure and administration of budgetary control of the N.C.R.I was highlighted with respect to a non profit making organization.

2.1 BUDGETARY CONTROL IN A NON PROFIT MAKING ORGANIZATION

budgetary is a financial planning that serves as the basis for expenditure decision making and therefor  subsequent control of expenditure.

Planning is a systematic and formalized  process for purposely directing and controlling process for purposely directing and controlling future operation towards desired objectives lack of adequate planning will result in an organization “Reacting” to unexpected event which can be costly, risky and socially disruptive. However careful planning gives the organization chance to   and or anticipated danger. It required the  management to be considerable research  before making decision  as which  action to be taken. Every organization some form of budgeting. It is essentially important in non profit making organization especial those whose annual receipts or revenue are fixed or determined to adhere closely to plans as expressed in the budget.  Performance control in the managerial content to direct the organization system is the ability to direct the organization activities towards fulfilling its objective.

Budgeting is a  management control tool used to ensure achievement of organization set objective with indications of performance. Budgetary control system are designed to monitor the variables that determine the discrepancies with executed performance and to take corrective action if those discrepancies would impede the completion of the expected result.

Budget has been defined by M.W. Biggs, a renowned authority on budgeting as “a financial and or quantitative statement prepared prior to a definite period of period for the purpose of attaining a given objective.’[ however it is realized from the definition that budget is a pre- request in performance control processing. Once the budget has been approved and the budget period commence management at once the must being to exert strong efforts to reach the projected goals and to review these efforty as time goes by. This is the essence of budgetary control.

The management accounting in the civil service of Nigeria (1977) defined budgetary control as the establishment of budgets relating to the responsibilities of middle managers to meet the objectives of an organization and the continuous comparison of actual with budgeted result so that if remedial action is necessary, it may be taken at an early stage. The definition satisfies the description  of an operating budget as “An operating short terms plan for managing the resources necessary to carry out a programme.’

Hence, budgets are assented feature of most control system. If well administered, they aid the planning process, provide performing criteria, serve as a communication tool, and co- ordinate organization activities. Thus , this makes it essential for non profit making organization whose service  institute was established along side with other 22 research institutes by a Federal at Ibadan until 1984 when, for output are either social and or developmental to exert all effort to adhere. Strictly to the operating budget.

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