Effect of Budgetary Planning and Control on the Profitability of Manufacturing Companies: A Study of Flour Mills Nigeria Plc.

Abstract:

The study examined the impact of budgetary, planning and control on the profitability of manufacturing companies: A study of flour mills Nigeria plc. Budgetary, planning and control remains indispensable and pivotal in any organizational setting be it profit making or not. Resources are often scarce and limited with an array of needs and expenditures to be met. Budgetary planning and control ensures efficiency in the utilization of resources through methods and techniques of cost management that includes budget creation, assigning responsibilities to units/ departments, comparing actual performance to the budget, and acting on the results to maximize profit. Financial controls on the other hand are procedures, processes and policies by which organizations monitors and control the direction, allocation and usage of its financial resources optimally. The study adopted the quantitative research design, data were collected from both primary and secondary sources and analysed using the simple regression and descriptive statistical technique. The study result revealed that budgetary control and financial controls have significant and positive effect on return on assets of Flour Mills Nigeria Plc. The study recommended that firm’s strategies to attain budget targets should be dynamic and realistic, budget targets should always align with companies objectives as well as revenue estimates. Management should strive to constantly review existing standards and introduce measures that strengthens the internal control system to prevent inadvertent override of controls.