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Title Page: - - - - - - - - - - i
Declaration - - - - - - - - - - ii
Approval page - - - - - - - - - iii
Dedication - - - - - - - - - - iv
Acknowledgements - - - - - - - - v
Table of Contents: - - - - - - - - vi
Abstract: - - - - - - - - - - ix
1.1 Background to the Study - - - - - - - 1
1.2 Statement of Problem - - - - - - - 3
1.3 Significance of the Study - - - - - - 4
1.4 Objectives of the study - - - - - - 5
1.4 The research Questions - - - - - - - 6
1.5 Research Hypothesis - - - - - - - 6
1.7 Scope of the Study - - - - - - - 7
1.8 Structure of the Study - - - - - - - 7


2.1 Introduction - - - - - - - - - 9
2.2. Conceptual Framework of Budgeting and Budgetary Control - 10
2.2.1 Meaning of Budget and Budgeting - - - - - 10
2.2.2 The Principles of Good Budgeting - - - - - 12
2.2.3 Importance or Purpose of Budgeting - - - - - 13
2.2.4 The Broad Classification and Preparation of budget - - 14
2.2.5 Types of Budget - - - - - - - - 16
2.2.6 Budgetary Control - - - - - - - - 19
2.2.7 Condition necessary for the Success of a budgetary System - 20
2.2.8 Variance Analysis - - - - - - - 21
2.2.9 When to Investigate Variance - - - - - - 22
2.3 Review of Prior Studies - - - - - - - 23
2.4 Budget Implantation - - - - - - - 25
2.5 Brief History Background of the case study - - - - 27


3.1 Introduction - - - - - - - - 3

3.2 Research Design - - - - - - - 31
3.2.1 Population of the study - - - - - - - 31
3.2.2 Sample of the study - - - - - - - 32
3.2.3 Nature and Sources of Data - - - - - - 32
3.2.4 Techniques of Data Processing Analysis - - - - 34
3.2.5 Instruments and Procedure of data Collection - - - 33
3.2.6 Description of Variables Employed - - - - - 33
3.2.7 Problems and Limitations of Data Collection and Design - - 35
4.1 Introduction - - - - - - - - - 36
4.2 Data Presentation and Analysis - - - - - - 36
4.3 Test of Research Hypothesis - - - - - - 39
4.4 Evaluation of Data and Research Findings - - - - 37
5.1 Chapter Summaries - - - - - - - 44

5.2 Conclusions - - - - - - - - - 46
5.3 Limitation of Study - - - - - - - - 47
5.4 Recommendations of Study - - - - - - 48
5.5 Suggestions for Further Research - - - - - 50
Reference - - - - - - - - - 51
Appendix - - - - - - - - - 53


Budget and budgetary control, both at management and operational level looks
at the future and lays down what has to be achieved. Control checks whether or
not the plans are realized, and puts into effect corrective measures where
deviation or shortfall is occurring. This study examines how budget and
budgetary control can impact on the performance of the BBL, as considered in
this study. We reviewed the performance of BBL in previous and recent times.
We found out that the performance of this industry depends much on the
budgetary system in achieving its objectives. An empirical investigation was
undertaken, using the simple correlation analysis techniques specifically the
Pearson Product Movement Correlation. In most of the cases considered
established the presences of strong relationship between turn over as a variable
of budget and performance indicators-EPS, DPS, and NAS, of BBL. Following
our findings, we advise managers and business operators to pay more attention
to their budgetary control system, for those without an existing budgetary
control system, they should put one in place, and those with a dummy or passive
budgetary control system, It is time they re- establish a result- oriented
budgetary control system as it goes a long way in repositioning the
manufacturing industry from its creeping performance level to an improved
high capacity utilization point.


1.1 Background to the Study
There is hardly any aspect of human Endeavour that does not have
economic implication because economics as a science is essentially
concerned with the study of scarce resources, there allocation,
management and utilization. This reality is what gave birth to a business
budget in the 20
century. The term budget was first put to use in Europe
to refer to first, a leather bag used to carry statement of revenue and
expenditure, and later the term was referred to as the statement itself
and not just the container.
Today, a budget play a greater role in the planning and control
process of basically all organization, be it private or public sector,
ministries and non profit-making organizations.
Organizations developed plans on how to go about its future
operations. While control measures are used to correct any deviation
from the plans. The budgetary process is an integral part of both planning
and control. Budgeting is making plans for the future, implementing those
plans and monitoring activities to see whether they conform to plans. To

do this successfully, it requires maximum commitment by the top
management, corporative and motivated middle management and staff,
and well organized reporting system.
The importance of budget to households, business organization can
never be over emphasized. Most families or members of households have
at point developed a budget to guide them in allocating resources over a
specific period of time. The family budget is a planning tool, but it also
serve as control behaviour of family members by setting limits on what
can be spent within each budget category. Budget enables house to know
how much of their money is being spent. Such a situation can easily lead
family into unexpected debt and severe financial difficulties.
Likewise, budgets play a similar planning and control role for
managers within business units and budgets are a central part of a design
and operation of management accounting system. As in household
budget, budget in business organizations reflects in quantitative term,
how to allocate financial and other resources to each organizational
subunit, based on its planned activity objective. Budgeting activity to
organizational unit can reflect how well unit managers understand the
organizational and provides an opportunity for the organizations top
planners to correct misperceptions about the organizations goal.

Budgeting also aims at coordinating the organizations many activities. For
example, budget show the effect of sales level or volume on purchasing,
production, administrative activities etc.
In reality, budgeting is the most widely used accounting tool for
planning and controlling the activities of organizations. Budgeting system
helps managers to forecast. By looking into the future and planning
managers are able to anticipate and correct potential problems before
they arise. Managers can then focus on exploiting opportunities instead of
fighting fires as one observer said few businesses plan to fail, but many
of those that flop fail to plan (Horngren, et al, 2002; 178).
The research is deeply concerned with the extent to which
management of Brewery companies seize the advantages associated with
budgeting process. The researcher is interested in finding out if managers
of Brewery companies effectively and efficiently design and implement
realistic budgets. Do they use budgets as a potent tool for resource
allocation and control?
The choice of Benue Brewery Limited as a case study for this
research work is informed by the industrys relatively long-life span of
production. Secondly, the relative low level of production at the industry
has also prompted the researcher to investigate its budgetary system.

1.2 Statement of The Problem
Budgeting and budgetary control is one of the essential functions of
every business organization. Survival and growth of any corporate
organization depends on effective budgetary control measures. This
implies that if budgets are effectively designed and implemented, an
organization can achieve massive results.
On the other hand, in Nigeria today, there are incidences of
corporate failure in most organizations. It appears managers are not taking
advantage of the budgetary process to the success of business
The behavioral or human aspect of budgeting is equally worrisome;
how do peoples attitudes affect the budgets, and in turn, how do budget
affect peoples behaviour? The questions intrigued social scientist to
engage in extensive study about the human factors involved in budgeting.
Moreover, the research is aimed at knowing if budgeting and
budgetary control is playing a significant role in achieving the objective of
organizations, to investigate the problems associated with the designing
and implementation of budgets in organization, to find out whether poor
performance in some organizations is attributed to poor implementation
and finally, to investigate the human aspect of budgeting.

1.3 Significance of the Study
The study will be significant in various ways to various parties, as
will be seen below;
It will present in a precise manner, the importance of the role of
budgeting and budgetary control in achieving organizational goals.
To managers and potential managers, the findings of the research,
suggestion and recommendations based on the findings will be a good
guide for future management of resources using budgeting and budgetary
control. The outcome of the study will help widen their horizons on
resource allocation and control. Operating staffs will also be informed on
how they can improve their operation through the use of budgets as guides.
The research report will also serve as a reference material to students
of accounting, especially those with a bias in management accounting.
The research will also provide ample information to external
auditors on how resources of companies are allocated and managed. This
will certainly enhance their audit planning.
Finally, this study is intended to unveil those factors that are
responsible for poor budget implementation frequently leading to their
failures while also highlighting the control mechanisms required for a
successful budget implementation.


1.4 Objectives of the Study
The objective of this research work includes the following:
i. To ascertain the role of budgeting and budgetary control in
achieving the objectives of Brewery industries.
ii. To investigate the relationship that exists between the designing
and implementation of budgets in Brewery industries.
iii. To find out the relationship between poor performance and poor
implementation of budgets in brewery industry.
1.5 Research Question
1. What is the relationship between budgetary control and the achievement
of companies performance
2. Is there any relationship between the designing and implementation of
budgets in companies?
3. What is the relationship between poor performances and poor
implementation of budgets?

1.6 Research Hypothesis

: There is no relationship between budgetary control and the
Achievement of companys objectives

: There is relationship between budgetary control and the achievement
Of companies objective
: There is no relationship between the design and the implementation of
Budgets in companies performance
: there is relationship between the design and the implementation of
In companies performance
: There is no relationship between poor performance and poor
Implementation of budget
: There is relationship between poor performance and poor
of budget.

1.7 Scope of the Study
The research is intended to cover budgetary activities as they affect
the realization of goals and objectives of Brewery industries. However,
due to the diverse nature of Brewery industries with varying objectives

and the time frame required for the report of the research , the research
has been scaled down to a case study of Benue Brewery Limited (BBL),
Makurdi. The period under investigation is from 2009-2012

1.8 Structure of the Study
This research work is divided into five (5) chapters with chapter
one as the introductory chapter which is divided into nine (9) sections
including background to the study, statement of problem, objective of the
study, the research questions, research hypotheses, significance of the
study, scope of the study, the structure of the study and the definition of
Chapter two is the literature review which includes the conceptual
framework of budgeting and budgetary control, review of prior studies,
chapter summary and a brief historical background of the case study
which is Benue Brewery Limited (BBL).
Chapter three (3) is the research methodology made up of the
introduction, research design, population and sample size, nature and
sources of data, instrument and procedure for data collection, description
of variables employed, techniques of data processing and analysis,

problem and limitation of data collection and design and chapter
Chapter four is the data analysis and result which is made up of
introduction, data presentation and analysis, test of research hypotheses,
evaluation of data and research findings.
Finally, chapter five (5) is the summary, conclusions,
recommendations which is made up of summary of findings,
generalization of findings, limitation of study, conclusions,
recommendations of study and lastly the suggestions for further research.
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