APPLICATION OF BUDGETS AND BUDGETARY CONTROL MEASURES IN A NON-PROFIT ORGANIZATION: A CASE STUDY OF APOSTOLIC CHURCH, DELTA
2.1 CONCEPTUAL FRAMEWORK
A budget is can be defined by accountants as “a planned outcome to be generated and for the expenditure to ensure during that period and the capital to be
employed to attain a given objective. Budgets are what organizations must strictly adhere to in other to avoid unnecessary expenses.
Ezeugwu (1998), defined a budget as a quantitative plan of action of how to carry out an operation/process by a business/establishment.
Osisioma (1987), defined a budget as a dierent
phases of business operation aimed at helping management towards the attainment of organizational objectives.
Horngren and Foster (1988), see a budget as a quantitative expression of a plan of action and an aid to coordination and implementation. Matz and Ivory
described a budget simply as a plan expressed in a financial and other quantitative terms and stressed that the terms “Budgeting, Profit and
Planning” are synonymous. Pogues opined that a budget is a plan or target I the form of a quantitative statement for a specified time-span. He stated that a
budget for the future time-span attempts to look over the hill into the future t where the business hopes to be in a future period of time and how it intends to
get there. The budget, therefore, attempt to look at tomorrow’s business world (in a short time frame) and management is forced to think a tomorrow’s opportunities.
Budget was also described as comprehensive and co-ordinated plan, expressed in financial terms, for the operations and resources of an enterprise for some
specifies period in future. A budget involves every level of activity integrating revenue plans, expense plans, asset requirements and financing needs.
To Pandey (1985) a budget is a plan of the organization’s manipulation of relevant variables (controllable and uncontrollable) and reduces the impact of
uncertainty. It activates the management into influencing the environment in the interest of the organization.
According to Osisioma (1989) a budget has a number of characteristics, namely. It is a plan of action
The plan is stated in quantitative or financial terms or both.
It is prepared prior to a defined period of time for the control of performance within the period.
It states performance expectations over a defined period of time, in dierent
phases of business operation – sales, production, marketing and so on.
It integrates the resources and costs of an organization, to plan for anticipated level of performance.
It is aimed at the attainment of organizational objectives
From the foregoing, it could be seen that a budget is a quantitative state of plans in a future period. The process of preparing budget is known as budgeting.
Planning, according to Osisioma (1989) is the management function concerned with the identification of objectives and target and, the selection of policies
and methods necessary to achieve those objectives. Planning is a process of deciding what action should be taken in the future Furthermore, it was defined
by Homegrown and Foster as the delineating of goals, predictions of potentials, results under various ways of attain described results. The purpose of business
planning is to minimize uncertainty about the future and through co-ordination of plans to increase the chances of making a satisfactory profit. Planning is, therefore, required at all levels of an organisation, departmental/sectional plan must synchronize in order to achieve the broad objectives of the organisation.