This research work titled “An evaluation of budget and budgetary control in Nigeria communication industry, with particular reference to mobile Tele-communication Network (MTN) Nigeria ltd.” The researcher examined the extent of budgeting in mobile Tele-communication network (MTN) Nig. Ltd. Examined the effect of budget and budgetary control on decision making process in mobile Tele-communication network (MTN) Nig. Ltd. Identified the various problems associated with budget and budgetary control in mobile Tele-communication network (MTN) Nig. Ltd and proffer possible solutions to the problems identified . Data for the study was sourced from two main sources which include Primary and Secondary sources of data Collection. Primary data: questionnaires and oral interviews were used to collect information from the respondents. Secondary data: journals, and other relevant materials relating to the area of my investigation will be review. Extensive literature review was carried out on the direct literature and indirect literature on books, journals and past works. The research instrument used in this study includes oral interview and questionnaire. The questionnaire is structural as to contain both close and open ended question. Simple tables and percentages were used in treatment of data. The researcher discovered that budget planners should plan in interest of the entire country recommended that the budget unit should make an extensive use of budget document and program budgeting which should enable the planners to know how much spent on the project and the return thereafter.

TABLE OF CONTENTS

Title page ii

Approval page iii

Dedication iv

Acknowledgement v

Abstract vi

CHAPTER ONE:

Introduction

1.1 Background of the study 1

1.2 Statement of problem 6

1.3 Objectives of the study 7

1.4 Research questions 8

1.5 Research hypotheses 9

1.6 Significance of study 10

1.7 Scope of the study 11

1.8 Limitation of the study 12

1.9 Definition of Terms 13

CHAPTER TWO:

Review of Related Literature

2.1 Concept of meaning of budget and budgetary control 16

2.2 Objectives of budgetary control 22

2.3 Scope and Techniques of standard costing and

budgetary control 23

2.4 Requisites for effective budgetary control 25

2.5 Budgetary Control 37

2.6 The planning and control process 39

2.7 Types of Budgets 41

2.8 Performance of Budgeting 50

CHAPTERTHREE:

Research Design and Methodology

3.1 Research Design 54

3.2 Area of the study 55

3.3 Population of the study 55

3.4 Sampling Method 56

3.5 Research Instrumentation 58

3.6 Validity and Reliability of the instrument 60

3.7 Sources of data 61

3.8 Method of Data Analysis 63

CHAPTERFOUR:

Presentation and Analysis of Data

4.1 Presentation and Analysis of Data 64

4.2 Testing of Hypothesis 71

CHAPTERFIVE:

Summary of Findings, Conclusion and Recommendations

5.1 Findings 79

5.2 Conclusion 81

5.3 Recommendation 82

Bibliography

Appendix

Questionnaire

CHAPTER ONE

INTRODUCTION

1.1 Background of the study

The term budget refers to a plan quantified in monetary terms, prepared and approved by appropriate authorities prior to a defined period of time, usually showing planned income to be generated and or expenditure to be incurred during that period and the capital to be employed to attain a given objective.

Abogun (2012) defined a budget as a plan of dominant individuals in an organization expressed in monetary terms and subject to the constraints imposed by the participants and the environments, indicating how the available resource may be utilized to achieve whatever the dominant individuals agreed to be the organization priorities.

Pandey (2003) in his formal definition defines budget as “a qualitative statement for a defined period of time which may include planned revenue, expenses, asset, liabilities and cash flows”.

Institute of cost and management accountants (ICMA) (as cited by Eze 2001), defined budget as “ a financial and or qualitative statement prepared prior to a defined period of time, of policy to the pursued during that period for the purpose of attaining a given objective”.

Lucey (2003) in his recent definition of budget defines it as a qualitative expression of a plan of action prepared for the business as a whole for departments, for functions such as sales and production or for financial resource item such as cash, capital, expenditure, manpower purchase, etc

Morgan (1997) opines that the budget had grown beyond a financial tool. It is above all managerial tool, in essence, it is the best tool for making sure that key resources, especially performance resources are assigned to priorities and to results. It is a tool that enables the manager to know when to review and revise plans, either because results are different from expectation or due to environment economics conditions, market conditions or technologies charge which no longer correspond to the assumption of the budget.

Welsh (2003) opines that budgeting is the only comprehensive approach to managing so far developed that, if utilized with sophistication and good judgment fully recognizes the dominant role of the manager and provide a framework for implementing side fundamental aspects of scientific management.

Budgeting at both management level and operation level looks at the future and lays down what has to be achieved, control checks whether the plans are being realized and put into corrective measures, where deviation or shortfall is occurring. According to Egam (1997) emphasized that without effective controls, an enterprise will be at the mercy of internal and external forces that can disrupt its efficiency and be unaware, when a budgeting and control system is in use, budgets are established which set out in financial terms, the responsibility of the managers in relation to the requirement of the overall policy of the company.

Financial, a budget provides a focus for the organization, aids the coordination activities and facilities control where as control is flexible budgets. The general objective of this study therefore is the way forward in which the research posed to evaluate budget and budgetary control in Nigeria communication industry with emphasis on mobile Tele-communication network Nigeria (MTN) Enugu state as a case study.

The company through planning and control represents several million of naira in investment. The company as at may 31, 2004 had a total of 31 mobile switching centres and over 940 radio base station across the country.

Several more are in the process of being installed on January 20, 2002. MTN commissioned the first phase of its digital microware transmission backbone, Yello balm is Africa’s most extensive transmission infrastructure and has significantly helped to enhance all quality on MTNS network. Yello balm SPS 3400 kilometers and traverse over 120 cities, villages and communities while coverage has been extended do more 90 mager towns and a total of over 5000 villages and communities across Nigeria. The second phase of Yellow balm is currently outgoing and will spend another 4500 kilometers.

MTN subsists on the core brand values of leadership, integrity, innovation, relationships and a “can do attitude” a passionate optimistic focus on the future.

1.2 Statement of problem

Budgetary control problems as a result of poor budget preparation. These arise such that; Problems in budgetary control may reflect a poorly formulated budget for example lack of credibility/realism. And lack of a comprehensive budget may complicate implementation for example separate timetable and rules for capital budget, extra-budgetary funds. And, also, where spending ministries have not been fully involved in their budget formulation so that they understand and own their budget. Also implementation problems can be reflected in lack of correct prediction of economic, social and political scenario or circumstances and the outbreak of situations like war, famine, natural disaster etc can hamper budget implementation. In Nigeria, the emergence of the civil war in May, 1976 really hinders the effective implementation of that fiscal year budget.

Some of the problems includes:

Lack of civil society involvement in budgetary control process in Nigeria Preparation. Delayed publication of financial statements. Lack of transparency and accountability. Lack of expert inclusion in the budget preparation to effectively forecast economic variables.

1.3 Objective of the study

The aim of this research work is to evaluate budget and budgetary control in Nigeria communication industry, with particular reference to mobile Tele-Communication Network (MTN) Nig. Ltd. The general objectives of this research work includes the following;

1. To examine the extent of budgeting in mobile Tele-Communication Network (MTN) Nig. Ltd.

2. To examine budgeting procedures and techniques in mobile Tele-Communication Network (MTN) Nig. Ltd.

3. To examine the effect of budget and budgetary control on decision making process in mobile Tele-Communication Network (MTN) Nig. Ltd.

4. To identify the various problems associated with budget and budgetary control in mobile Tele-Communication Network (MTN) Nig. Ltd. And also proffer possible solutions to the problems identified.

1.4 Research Questions

Based on the above objectives, the researcher developed the following research questions;

1. To what extent does mobile Tele-Communication Network (MTN) Nig. Ltd apply budgeting in their operation?

2. What are the budgeting procedures and techniques in mobile Tele-Communication Network (MTN) Nig. Ltd?

3. Does budget and budgetary control have any effect on decision making process in mobile Tele-Communication Network (MTN) Nig. Ltd?

4. What are the various problems associated with budget and budgetary control in mobile Tele-Communication Network (MTN) Nig. Ltd?

1.5 Research hypotheses

Ho: Mobile Tele-Communication Network (MTN) Nig does not apply budget and budgetary control in their decision making.

H1: Mobile Tele-Communication Network (MTN) Nig applies budget and budgetary control in their decision making.

Ho: There is no problem associated with budget and budgetary control in mobile Tele-Communication Network (MTN) Nig. Ltd.

H1: There are so many problems associated with budget and budgetary control in mobile Tele-Communication Network (MTN) Nig. Ltd.

1.6 Significance Of The Study

It is important to point out that on completion of this work by the researcher, it would be of immense significance to the following:

Researchers: Other researchers on the same or similar topic would find this work helpful as it will form a base of review of related literature and also a stepping-shine for future researchers.

Economy: This work will help to improve the economy through budget and budgetary control. This is because of improvement in the efficiency and effectiveness of the operations as well as the overall success of a country depends on its budgeted plans which will be achieved through adequate implementation.

Shareholders: The wealth of the shareholders will be maximized due to adequate budgetary control.

1.7 Scope of the Study

This project work focuses on the evaluation of budget and budgetary control in Nigeria communication industry, with particular reference to mobile Tele-Communication Network (MTN) Nig. Ltd Ziks avenue Enugu.

1.8 Limitations of the Study

The researcher in carrying out this study encountered numerous problems, which includes:

i) Financial.

ii) Time and several other constraints.

i) FINANCIAL – This included lack of enough fund to move around and visit the various areas in the state, and also lack of money to buy enough research material which constitutes an impediment to the researcher, high cost of transportation in the city due to long distance also imposed its own limitation on the researcher.

ii) TIME – Time is also another constraints to the researcher. This is because the researcher is combining school activities and at the same time this made her unable to cover a lot of interesting areas but therefore limited her research work only at mobile Tele-Communication Network (MTN) Nig. Ltd Ziks avenue Enugu.

From the above points the researcher tried her best to bring out a detailed study on the evaluation of budget and budgetary control in Nigeria communication industry.