EJEMUTA, Emmanuel Ogheneruna

Effect of Budgetary Control on the Financial Performance of Small and Medium-Sized Enterprises in Lagos State - Dr. AKINYOMI, O. J. - Ibafo Accounting and Finance 2019 - xii,; 83p.

For both developing and developed economies, small and medium sized firms play substantial
roles in the process of industrialization and economic growth. The contribution of small and
medium-sized enterprises (SMEs) has been recognized as the primary support of the economy
because of their ability to boost the production of the economy and improve human
welfare.Small companies in Nigeria, however, were unable to add value to the economy because
of many problems facing their activities. Issues arising from bad funding of small and mediumsized enterprises include lack of skilled leadership resulting from the failure of owners to hire
expert services; use of outdated machinery and manufacturing techniques due to the failure of
owners to access fresh technology; and excessive competition resulting from revenues resulting
from sales.This objective of this study was to identify the effect of budgetary control on the
financial performance of SMEs in Lagos State. Using survey research design, the study comprise
of the population of 492 SMEs operating within the Ikeja Local Government Area of Lagos state
while the population was sampled using the simple random sampling technique. From the study,
142 out of the 221 sample respondents filled-in and returned the questionnaires making a
response rate of 64.25%. This was analysed using the Statistical Package for Social Sciences
(SPSS 22) using descriptive statistics. Independent variables that was used to measure budgetary
control included budget planning, budget monitoring and control, and budget evaluation and
dependent variable was financial performance. Mean and Standard Deviation within a range of
five points was used to measure all the independent variables. The data was subjected to Linear
Regression Analysis to test the research hypotheses. The probability level was set up at 0.05
significance. The result of the Linear Regression Analysis hence indicates thatbudget planning
has a significant relationship with financial performance of Small and medium-sized enterprises
in Lagos State (p value =0.000<0.05), budget monitoring and control has a significant
relationship with financial performance of Small and medium-sized enterprises in Lagos State (p
value=0.000<0.05), budget evaluation has a significant relationship with financial performance
of Small and medium-sized enterprises in Lagos State (p value=0.000<0.05). The study
concluded that financial performance increases proportionately with more inclusive using of
budget. This study however recommends that managers and owners of SMEs should hold budget
conferences and meetings regularly to review performance. Furthermore, the study also
recommends that organizations should develop more formal practice in the development of
budgetary controls, that is, Planning, Monitoring and Control and budget evaluation.Overall, the
study indicated that budgetary control contribute to the financial performance of SMEs in Lagos
State.


Accounting

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