ABSTRACT
This study is aimed at finding out the role commercial banks play over the small scale industries and the problem the small scale industries encounter.
This study, has been divided into five (s) chapters thus:.
Chapter one is the introduction, sitting out the background of the study. The researcher highlighted that the performance of small scale industries are financed by commercial banks and other financial institutions. This study is of paramount importance because it help s to discover the problems facing the small scale industries in the course of financing themselves.
Chapter two is a review of related literatures, it started by the definition of the small scale industries, the definition of the small scale industries, the financial institution involved, assistance provided by commercial banks to small scale industries, government policies for promoting small and medium scale industries etc.
Chapter three decals with the research design and methodology employed in the study. Here data were collected from secondary sources.
Chapter four, the research state the finding or result collected in the course of this research work.
Finally, Chapter five state the conclusion and recommendation of this study.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The concept of dependent has occupied a central place in the economic development over the year, basically as a manifestation of the various attempts by the developing world to chart new economic strategies which would reliever them of economic dependence on their former colonial master in Europe. Today the concept of dependent continues to be misunderstood in its fundamental ramifications and has remained difficult in large sections of the developing world. In Nigeria, neither the mixed economy approach, appeal to have responds to the dictates of economies dependent.
However, in pursuit of dependent in the developing world like Nigeria, the central government enacted a decree called “enterprises promotion decree”. When there was a need for small scale enterprises, owned and managed by Nigeria to be promoted. The importance of small enterprises in the promotion of economic development has always been at the forefront of the development strategies. Many developing countries have failed to adopt this strategy owing to their belief that it is a relatively slow process of industrialization. But in the recent times due to the scarcity of foreign exchange, attention has began to be focused once again on development of ingenious. Without the development of small scale industries in Nigeria, the Nations request fort industrialization will certainly remain forever at a state.
Furthermore, several financial institutions are invested in entrepreneurship development in Nigeria in ways. Some of them are set up by the gove3rnment for specific functions, there main functions are to provide findings, relief from financial consequences of uncertainty, and advisory services for business enterprises, public and private. The government plays the role of financial companies.
Some of these institution include: Nigerian Bank for commerce and industry (NBCI) Nigerian Agricultural and development Bank (NDB), peoples bank of Nigerian (PBN), the commercial sourcing for fund and enough funds cannot be mobilized from friend and relations, the next things that comes to mind is to try the banks. The commercial banks for instance, is the center of the leading market and makes the greatest number and varity of loans. The commercial banks are very conservative in lending. The commercial banks look at many things apart from the ability of entrepreneur to provide the needed collateral and may be interested by looking at the feasibility report, the experience of the entrepreneur, his personal credit records, profit potentials.
More so, Apart from the banks, financial institution like the insurance companies provide relief from financial loss and especially from fear of loss is perhaps is one of the fastest growing melustries in Nigeria. It is the important for the entrepreneur who want to be free from the uncertain loss in threat of loss to have adequate insurance.
Finally, the role of banks in the development of small scale enterprises cannot be over emphasized due to the role it plays in the country over the small scale industries.
1.2 STATEMENT OF THE PROBLEM
Some financial institution in Nigerian are involved in entrepreneurship development in many ways. Some of them are set up by the government for specific function while others are set up by private organization. They provide funding, relief from financial consequences uncertainty and advisory services for business enterprises etc. Stile on this, there is problem of development in small scale industries. Why is it that our small scale industries are not yet developed despite all the functions performed by financial institutions in Nigeria. Could it be that the credit granting for entrepreneurship developments from banks are not adequate for funding them. The answer to this question will come in the subsequent chapter of this research work.
1.3 PURPOSE I OBJECTIVES OF THE STUDY
For the purpose of this research the researcher has come out with the following objective.
(1) To know what small scale industries is all about
(2) To know specific function perform by the government in developing small scale industries.
(3) To know some of the financial institutions involved in the development of small scale industries in Nigeria.
(4) To know some of the assistance provided by commercial bank in the area of small scale industries.
(5) To know some of the government policy for promoting small and medium scale enterprises.
(6) To know some of the government roles in encouraging small industries
(7) To know the affect of government policies on the small scale industries
(8) To know the problems of scale and medium scale industries.
Finally, to give solution or suggestion on how to tackle the problems of small scale enterprises in Nigeria.
1.4 SIGNIFICANCE OF THE STUDY
This research work will be of great importance to so many beneficiaries, specifically to both private and public owners of business. Individuals who are into small scale business will equally benefit and also those who enter into the business of small scale industries will equally benefit from this research work.
However, financial institution will equally benefit are returns from the small scale industries will deposited in their custody. When profits are generated effective utilization of this research work.
1.5 LIMITATION OF THE STUDY
The Research has already said that the scope of the research work is limited to commercial banks and the reasons for this had been given. The limitation that is tucked about here will be taken to mean the problem already and will still be encountered by the researcher. It is always said and believe that, “nothing good comes easy” and “with out pains no gains”.
The Research is at present undergoing and still anticipates more of economic problems. The research of this nature should normally required a lot of money, which an average student just cannot afford especially with the present economic situation in Nigeria.
However, with the little financial support from my parent and aids from friends and well-wishers, even relatives, I hope to overcome, this constraint.
On the other hard, time factor is another problem confronting the researcher in this study. A regular full time under-graduate student especially of Institution of Management and Technology who carries the normal semester load does not have the full necessary time required for a research work of this kind. He attends lectures from Monday to Friday. However, with deviation and commitment and by the special grace of God, I hope to and will succeed.
TABLE OF CONTENT:
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
1.2 Statement of the Research Problem
1.3 Objectives of the Study
1.4 Significance of the Study
1.5 Research Questions
1.6 Research Hypothesis
1.7 Conceptual and Operational Definition
1.8 Assumptions
1.9 Limitations of the Study
CHAPTER TWO
LITERATURE REVIEW
2.1 Sources of Literature
2.2 The Review
2.3 Summary of Literature Review
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Research Method
3.2 Research Design
3.3 Research Sample
3.4 Measuring Instrument
3.5 Data Collection
3.6 Data Analysis
3.7 Expected Result
CHAPTER FOUR
DATA ANALYSIS AND RESULTS
4.1 Data Analysis
4.2 Results
4.3 Discussion
CHAPTER FIVE
SUMMARY AND RECOMMENDATIONS
5.1 Summary
5.2 Recommendations for Further Study
Bibliography
HOW TO GET THE FULL PROJECT WORK
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(3) Payment Name
(4) Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: COMMERCIAL BANKS ROLE IN FINANCING SMALL SCALE INDUSTRIES IN NIGERIA
ABSTRACT
This study is aimed at finding out the role commercial banks play over the small scale industries and the problem the small scale industries encounter.
This study, has been divided into five (s) chapters thus:.
Chapter one is the introduction, sitting out the background of the study. The researcher highlighted that the performance of small scale industries are financed by commercial banks and other financial institutions. This study is of paramount importance because it help s to discover the problems facing the small scale industries in the course of financing themselves.
Chapter two is a review of related literatures, it started by the definition of the small scale industries, the definition of the small scale industries, the financial institution involved, assistance provided by commercial banks to small scale industries, government policies for promoting small and medium scale industries etc.
Chapter three decals with the research design and methodology employed in the study. Here data were collected from secondary sources.
Chapter four, the research state the finding or result collected in the course of this research work.
Finally, Chapter five state the conclusion and recommendation of this study.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The concept of dependent has occupied a central place in the economic development over the year, basically as a manifestation of the various attempts by the developing world to chart new economic strategies which would reliever them of economic dependence on their former colonial master in Europe. Today the concept of dependent continues to be misunderstood in its fundamental ramifications and has remained difficult in large sections of the developing world. In Nigeria, neither the mixed economy approach, appeal to have responds to the dictates of economies dependent.
However, in pursuit of dependent in the developing world like Nigeria, the central government enacted a decree called “enterprises promotion decree”. When there was a need for small scale enterprises, owned and managed by Nigeria to be promoted. The importance of small enterprises in the promotion of economic development has always been at the forefront of the development strategies. Many developing countries have failed to adopt this strategy owing to their belief that it is a relatively slow process of industrialization. But in the recent times due to the scarcity of foreign exchange, attention has began to be focused once again on development of ingenious. Without the development of small scale industries in Nigeria, the Nations request fort industrialization will certainly remain forever at a state.
Furthermore, several financial institutions are invested in entrepreneurship development in Nigeria in ways. Some of them are set up by the gove3rnment for specific functions, there main functions are to provide findings, relief from financial consequences of uncertainty, and advisory services for business enterprises, public and private. The government plays the role of financial companies.
Some of these institution include: Nigerian Bank for commerce and industry (NBCI) Nigerian Agricultural and development Bank (NDB), peoples bank of Nigerian (PBN), the commercial sourcing for fund and enough funds cannot be mobilized from friend and relations, the next things that comes to mind is to try the banks. The commercial banks for instance, is the center of the leading market and makes the greatest number and varity of loans. The commercial banks are very conservative in lending. The commercial banks look at many things apart from the ability of entrepreneur to provide the needed collateral and may be interested by looking at the feasibility report, the experience of the entrepreneur, his personal credit records, profit potentials.
More so, Apart from the banks, financial institution like the insurance companies provide relief from financial loss and especially from fear of loss is perhaps is one of the fastest growing melustries in Nigeria. It is the important for the entrepreneur who want to be free from the uncertain loss in threat of loss to have adequate insurance.
Finally, the role of banks in the development of small scale enterprises cannot be over emphasized due to the role it plays in the country over the small scale industries.
1.2 STATEMENT OF THE PROBLEM
Some financial institution in Nigerian are involved in entrepreneurship development in many ways. Some of them are set up by the government for specific function while others are set up by private organization. They provide funding, relief from financial consequences uncertainty and advisory services for business enterprises etc. Stile on this, there is problem of development in small scale industries. Why is it that our small scale industries are not yet developed despite all the functions performed by financial institutions in Nigeria. Could it be that the credit granting for entrepreneurship developments from banks are not adequate for funding them. The answer to this question will come in the subsequent chapter of this research work.
1.3 PURPOSE I OBJECTIVES OF THE STUDY
For the purpose of this research the researcher has come out with the following objective.
(1) To know what small scale industries is all about
(2) To know specific function perform by the government in developing small scale industries.
(3) To know some of the financial institutions involved in the development of small scale industries in Nigeria.
(4) To know some of the assistance provided by commercial bank in the area of small scale industries.
(5) To know some of the government policy for promoting small and medium scale enterprises.
(6) To know some of the government roles in encouraging small industries
(7) To know the affect of government policies on the small scale industries
(8) To know the problems of scale and medium scale industries.
Finally, to give solution or suggestion on how to tackle the problems of small scale enterprises in Nigeria.
1.4 SIGNIFICANCE OF THE STUDY
This research work will be of great importance to so many beneficiaries, specifically to both private and public owners of business. Individuals who are into small scale business will equally benefit and also those who enter into the business of small scale industries will equally benefit from this research work.
However, financial institution will equally benefit are returns from the small scale industries will deposited in their custody. When profits are generated effective utilization of this research work.
1.5 LIMITATION OF THE STUDY
The Research has already said that the scope of the research work is limited to commercial banks and the reasons for this had been given. The limitation that is tucked about here will be taken to mean the problem already and will still be encountered by the researcher. It is always said and believe that, “nothing good comes easy” and “with out pains no gains”.
The Research is at present undergoing and still anticipates more of economic problems. The research of this nature should normally required a lot of money, which an average student just cannot afford especially with the present economic situation in Nigeria.
However, with the little financial support from my parent and aids from friends and well-wishers, even relatives, I hope to overcome, this constraint.
On the other hard, time factor is another problem confronting the researcher in this study. A regular full time under-graduate student especially of Institution of Management and Technology who carries the normal semester load does not have the full necessary time required for a research work of this kind. He attends lectures from Monday to Friday. However, with deviation and commitment and by the special grace of God, I hope to and will succeed.
TABLE OF CONTENT:
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
1.2 Statement of the Research Problem
1.3 Objectives of the Study
1.4 Significance of the Study
1.5 Research Questions
1.6 Research Hypothesis
1.7 Conceptual and Operational Definition
1.8 Assumptions
1.9 Limitations of the Study
CHAPTER TWO
LITERATURE REVIEW
2.1 Sources of Literature
2.2 The Review
2.3 Summary of Literature Review
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Research Method
3.2 Research Design
3.3 Research Sample
3.4 Measuring Instrument
3.5 Data Collection
3.6 Data Analysis
3.7 Expected Result
CHAPTER FOUR
DATA ANALYSIS AND RESULTS
4.1 Data Analysis
4.2 Results
4.3 Discussion
CHAPTER FIVE
SUMMARY AND RECOMMENDATIONS
5.1 Summary
5.2 Recommendations for Further Study
Bibliography
HOW TO GET THE FULL PROJECT WORK
PLEASE, print the following instructions and information if you will like to order/buy our complete written material(s).
HOW TO RECEIVE PROJECT MATERIAL(S)
After paying the appropriate amount (#5000) into our bank Account below, send the following information to
08139462710 or 08137701720
(1) Your project topics
(2) Email Address
(3) Payment Name
(4) Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: COMMERCIAL BANKS ROLE IN FINANCING SMALL SCALE INDUSTRIES IN NIGERIA
TABLE OF CONTENTS
Title page
Approval page
Dedication
Acknowledgement
CHAPTER ONE: INTRODUCTION
1.1 Background of the study
1.2 Statement of the study
1.3 Objectives of the study
1.4 Definition of the study
CHAPTER TWO: REVIW OF RELATED LITERATURE
2.1 What is a Bank?
2.2 Basic principle of commercial banking lending
2.3 Nigeria commercial Banks lending
2.4 Factors that determine lending in commercial Banks
2.5 Impacts of lending policies on Nigeria Economic
CHAPTER THREE: RESEARCH AND METHODOLOGY
3.1 Sources of Data
3.2 Location of Data
3.3 Method of Data collection
CHAPTER FOUR: SUMMARY OF FINDINGS
4.1 The following were observed during the analysis
4.2 The full compliance to the lending policies
4.3 The credit facilities
4.4 Limit Approved
4.5 Its proper implementation
CHAPTER FIVE: CONCLUSION AND RECOMMENDATION
5.1 Conclusion
5.2 Recommendation
Bibliography
CHAPTER ONE
1.1 BACKGROUND OF THE STUDY
Back credit and lending function as we are aware evolved from a rather humble beginning as a result of the discovery made by the gold smith some continues ago, though only a small proportion of the money kept with him for security purpose was indeed required by the depositors at any one time and that he could safely lend the rest to borrowers and make interest charge thereon. The banking habit that latter inherited such practice felt that only about nine(9) to ten (10) percent of the bank deposit at a give time were therefore demand by the depositors.
However the commercial banks role of pooling funds together for the more surplus economics units to the deficit units of the country’s economy is what is regarded to as their leading function banks have in recent time been described as a machine of economic growth in an economy for the fact they perform this resources allocation function by mobilizing and channeling resources from savings surplus economic units to savings defeit units. In this position, they help in accelerating the trend of economic activities in various sectors of the economy, there by increasing the level of utility and wants of individuals and corporate bodies.
Well, as the above function is met, they would be more involved in the development of the economy because their raw material (money) is where other sector and sub-sector of the economy rotate.
More so, commercial banks have proved and are likely to remain the dominate financing intermediaries in Nigeria for they at present account for over 520 of the resources of the financial system to the economy and seemed to be more then units or sub-sectors able in all respects to influence the course of development.
This is why, not with standing the deregulation of the economy, banking is yet regarded as one of the most controlled or regulated in Nigeria. In monetary amendment guideline circular No 21 of January, 1987 the central bank of Nigeria (CBN) quoted as this in order to enhance the development of financial position and achieve a realistic resource allocation, the following change effected all control on interest rates were then removed in line tooth the emphresis on deregulation of the economy the second condition without in order to server as a signed to the desired direction of interest rate changes, the minimum rediscount rate would continue to be fixed by the central bank. This has gone further to show the benefits of commercial banks in the growth of the country’s economy. This is because in spite of the deregulation in the whole economy. The banks are still kept in check always and forced to operate within the policies of the monetary authorities.
1.2 STATEMENT OF THE PROBLEM
In Nigeria, as in most other developing countries of the world, poor banking awareness (especially in the rural areas) and under-litches militating against economic development. This ugly trend is as a result of poor and under develop banking system which has been identified for long. Actually, failure to develop a favourable bank lending policies and implication was pointed out as a major short coming of the west African currency Board (WACB) promoting the establishment of the central bank of Nigeria in 1958.
It was in 1937 that internal autonomy was achieved another commission was set up. During this period the federal government engaged the service of another financial expert of the bank of England, Mr. J.B. Loynes, it was his recommendation that led to the establishment of the central bank of Nigeria by the central bank of Nigeria ordinance of 17th march, 1959. it commenced of N1.5million of which N1.25 million was the amount paid up what infact appears annoying is that since the establishment of central Bank, the problem has remained unsolved despite all efforts made so far to get the bank improved in tending policies in Nigeria.
According to Iheneta (1988) he said that banks should shoulder some more social responsibilities to the shareholders. “It must be realized that bank are not charitable organizations like the international Red Cross”. They are in business to make profit and have compelling responsibilities to the their shareholders.
More so, the urge to a standard investigative research. A competitive Analysis of commercial banks lending policies and their implications.
1.3 OBJECTIVE OF THE STUDY
The aim of this research work is to undertake an in-depth analysis of the implications of lending policies on borrowers, commercial banks and the economy as a whole. Other specific objectives include:.
i. Assessing the extent to which commercial banks comply with statutory allocation of credit to the different sectors of the economy view the central bank credit guidelines.
ii. To test the rigidity of the commercial banks lending policies and their effect on the borrowing customers.
iii. To draw out lines of credit offered by these banks and their appraised process, highlighting the environmental influence that impinges on commercial banks lending policies in Nigeria.
Lending is of paramount importance in the economic hence the research work will investigate lending policies and practices of commercial banking system with country, finding out how realistic set making recommendation and suggesting ways to ensure effective implementation of those policies to achieve the desire objectives.
1.4 definition of terms
i. What is a bank: This is a financial institution that deals with money, in form of receiving drawing against such deposits on demand, issue of cheque and lending to customers.
ii. Financial intermediation: This is defined as the process by which financial houses serving as mediators accepts savings from individuals and house holds and lend these savings to the users.
iii. Funds mobilization: This is the process by which financial intermediaries put idle funds into effective use by collecting savings from those who have surplus idle funds (Net savers) and making them available to other (Net borrower’s) who need them for investment.
iv. loanable funds: This defined as the amount of bank founds which it can lend to its customers (or the public) at a particular time after making provision for legal reserve requirement.
v. Monetary policy:- It is a policy which deals with the discretionary control of money supply by the monetary authorities in order to achieve started or desired economic goals.
vi. Lending policy: The establishment of the direction and use of the funds from stock holder depositions others to control the composition and size of the loan portfolio and the determination of the general circumstance under which it is appropriated to make a loan. it is specifically designed by the management of the bank by which as lending practices are designed and controlled.
vii. Effective lending: A quantum of lending which maximizes the bankers objectives of liquidating and profitability and the economy’s objective of development.
viii. Lending: The facilities which a bankers offers to his customers or non-customer on the ground that such facility will be returned to the banker offer a specified time, on payment of some changes by the customers.
ix. PLC: Public Limited Company
x. CBN: Central Bank of Nigeria
Xi. WACB: West African Currency Board
Xii UBA: United Bank Of African PLC
Xiii. UBU Union Bank Of Nigeria.
HOW TO GET THE FULL PROJECT WORK
PLEASE, print the following instructions and information if you will like to order/buy our complete written material(s).
HOW TO RECEIVE PROJECT MATERIAL(S)
After paying the appropriate amount (#3000) into our bank Account below, send the following information to
08139462710 or 08137701720
(1) Your project topics
(2) Email Address
(3) Payment Name
(4) Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: COMMERCIAL BANKS LENDING POLICIES IN NIGERIA AND THEIR IMPLICATIONS (COMPAITIVE CASE STUDY OF THREE SELECTED COMMERICAL BANKS IN ENUGU ZONE
TABLE OF CONTENTS
Title page
Approval page
Dedication
Acknowledgement
CHAPTER ONE: INTRODUCTION
1.1 Background of the study
1.2 Statement of the study
1.3 Objectives of the study
1.4 Definition of the study
CHAPTER TWO: REVIW OF RELATED LITERATURE
2.1 What is a Bank?
2.2 Basic principle of commercial banking lending
2.3 Nigeria commercial Banks lending
2.4 Factors that determine lending in commercial Banks
2.5 Impacts of lending policies on Nigeria Economic
CHAPTER THREE: RESEARCH AND METHODOLOGY
3.1 Sources of Data
3.2 Location of Data
3.3 Method of Data collection
CHAPTER FOUR: SUMMARY OF FINDINGS
4.1 The following were observed during the analysis
4.2 The full compliance to the lending policies
4.3 The credit facilities
4.4 Limit Approved
4.5 Its proper implementation
CHAPTER FIVE: CONCLUSION AND RECOMMENDATION
5.1 Conclusion
5.2 Recommendation
Bibliography
CHAPTER ONE
1.1 BACKGROUND OF THE STUDY
Back credit and lending function as we are aware evolved from a rather humble beginning as a result of the discovery made by the gold smith some continues ago, though only a small proportion of the money kept with him for security purpose was indeed required by the depositors at any one time and that he could safely lend the rest to borrowers and make interest charge thereon. The banking habit that latter inherited such practice felt that only about nine(9) to ten (10) percent of the bank deposit at a give time were therefore demand by the depositors.
However the commercial banks role of pooling funds together for the more surplus economics units to the deficit units of the country’s economy is what is regarded to as their leading function banks have in recent time been described as a machine of economic growth in an economy for the fact they perform this resources allocation function by mobilizing and channeling resources from savings surplus economic units to savings defeit units. In this position, they help in accelerating the trend of economic activities in various sectors of the economy, there by increasing the level of utility and wants of individuals and corporate bodies.
Well, as the above function is met, they would be more involved in the development of the economy because their raw material (money) is where other sector and sub-sector of the economy rotate.
More so, commercial banks have proved and are likely to remain the dominate financing intermediaries in Nigeria for they at present account for over 520 of the resources of the financial system to the economy and seemed to be more then units or sub-sectors able in all respects to influence the course of development.
This is why, not with standing the deregulation of the economy, banking is yet regarded as one of the most controlled or regulated in Nigeria. In monetary amendment guideline circular No 21 of January, 1987 the central bank of Nigeria (CBN) quoted as this in order to enhance the development of financial position and achieve a realistic resource allocation, the following change effected all control on interest rates were then removed in line tooth the emphresis on deregulation of the economy the second condition without in order to server as a signed to the desired direction of interest rate changes, the minimum rediscount rate would continue to be fixed by the central bank. This has gone further to show the benefits of commercial banks in the growth of the country’s economy. This is because in spite of the deregulation in the whole economy. The banks are still kept in check always and forced to operate within the policies of the monetary authorities.
1.2 STATEMENT OF THE PROBLEM
In Nigeria, as in most other developing countries of the world, poor banking awareness (especially in the rural areas) and under-litches militating against economic development. This ugly trend is as a result of poor and under develop banking system which has been identified for long. Actually, failure to develop a favourable bank lending policies and implication was pointed out as a major short coming of the west African currency Board (WACB) promoting the establishment of the central bank of Nigeria in 1958.
It was in 1937 that internal autonomy was achieved another commission was set up. During this period the federal government engaged the service of another financial expert of the bank of England, Mr. J.B. Loynes, it was his recommendation that led to the establishment of the central bank of Nigeria by the central bank of Nigeria ordinance of 17th march, 1959. it commenced of N1.5million of which N1.25 million was the amount paid up what infact appears annoying is that since the establishment of central Bank, the problem has remained unsolved despite all efforts made so far to get the bank improved in tending policies in Nigeria.
According to Iheneta (1988) he said that banks should shoulder some more social responsibilities to the shareholders. “It must be realized that bank are not charitable organizations like the international Red Cross”. They are in business to make profit and have compelling responsibilities to the their shareholders.
More so, the urge to a standard investigative research. A competitive Analysis of commercial banks lending policies and their implications.
1.3 OBJECTIVE OF THE STUDY
The aim of this research work is to undertake an in-depth analysis of the implications of lending policies on borrowers, commercial banks and the economy as a whole. Other specific objectives include:.
i. Assessing the extent to which commercial banks comply with statutory allocation of credit to the different sectors of the economy view the central bank credit guidelines.
ii. To test the rigidity of the commercial banks lending policies and their effect on the borrowing customers.
iii. To draw out lines of credit offered by these banks and their appraised process, highlighting the environmental influence that impinges on commercial banks lending policies in Nigeria.
Lending is of paramount importance in the economic hence the research work will investigate lending policies and practices of commercial banking system with country, finding out how realistic set making recommendation and suggesting ways to ensure effective implementation of those policies to achieve the desire objectives.
1.4 definition of terms
i. What is a bank: This is a financial institution that deals with money, in form of receiving drawing against such deposits on demand, issue of cheque and lending to customers.
ii. Financial intermediation: This is defined as the process by which financial houses serving as mediators accepts savings from individuals and house holds and lend these savings to the users.
iii. Funds mobilization: This is the process by which financial intermediaries put idle funds into effective use by collecting savings from those who have surplus idle funds (Net savers) and making them available to other (Net borrower’s) who need them for investment.
iv. loanable funds: This defined as the amount of bank founds which it can lend to its customers (or the public) at a particular time after making provision for legal reserve requirement.
v. Monetary policy:- It is a policy which deals with the discretionary control of money supply by the monetary authorities in order to achieve started or desired economic goals.
vi. Lending policy: The establishment of the direction and use of the funds from stock holder depositions others to control the composition and size of the loan portfolio and the determination of the general circumstance under which it is appropriated to make a loan. it is specifically designed by the management of the bank by which as lending practices are designed and controlled.
vii. Effective lending: A quantum of lending which maximizes the bankers objectives of liquidating and profitability and the economy’s objective of development.
viii. Lending: The facilities which a bankers offers to his customers or non-customer on the ground that such facility will be returned to the banker offer a specified time, on payment of some changes by the customers.
ix. PLC: Public Limited Company
x. CBN: Central Bank of Nigeria
Xi. WACB: West African Currency Board
Xii UBA: United Bank Of African PLC
Xiii. UBU Union Bank Of Nigeria.
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OR
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Tags: COMMERCIAL BANKS LENDING POLICIES IN NIGERIA AND THEIR IMPLICATIONS (COMPAITIVE CASE STUDY OF THREE SELECTED COMMERICAL BANKS IN ENUGU ZONE
TABLE OF CONTENTS
Title page
Approval page
Dedication
Acknowledgement
CHAPTER ONE: INTRODUCTION
1.1 Background of the study
1.2 Statement of the study
1.3 Objectives of the study
1.4 Definition of the study
CHAPTER TWO: REVIW OF RELATED LITERATURE
2.1 What is a Bank?
2.2 Basic principle of commercial banking lending
2.3 Nigeria commercial Banks lending
2.4 Factors that determine lending in commercial Banks
2.5 Impacts of lending policies on Nigeria Economic
CHAPTER THREE: RESEARCH AND METHODOLOGY
3.1 Sources of Data
3.2 Location of Data
3.3 Method of Data collection
CHAPTER FOUR: SUMMARY OF FINDINGS
4.1 The following were observed during the analysis
4.2 The full compliance to the lending policies
4.3 The credit facilities
4.4 Limit Approved
4.5 Its proper implementation
CHAPTER FIVE: CONCLUSION AND RECOMMENDATION
5.1 Conclusion
5.2 Recommendation
Bibliography
CHAPTER ONE
1.1 BACKGROUND OF THE STUDY
Back credit and lending function as we are aware evolved from a rather humble beginning as a result of the discovery made by the gold smith some continues ago, though only a small proportion of the money kept with him for security purpose was indeed required by the depositors at any one time and that he could safely lend the rest to borrowers and make interest charge thereon. The banking habit that latter inherited such practice felt that only about nine(9) to ten (10) percent of the bank deposit at a give time were therefore demand by the depositors.
However the commercial banks role of pooling funds together for the more surplus economics units to the deficit units of the country’s economy is what is regarded to as their leading function banks have in recent time been described as a machine of economic growth in an economy for the fact they perform this resources allocation function by mobilizing and channeling resources from savings surplus economic units to savings defeit units. In this position, they help in accelerating the trend of economic activities in various sectors of the economy, there by increasing the level of utility and wants of individuals and corporate bodies.
Well, as the above function is met, they would be more involved in the development of the economy because their raw material (money) is where other sector and sub-sector of the economy rotate.
More so, commercial banks have proved and are likely to remain the dominate financing intermediaries in Nigeria for they at present account for over 520 of the resources of the financial system to the economy and seemed to be more then units or sub-sectors able in all respects to influence the course of development.
This is why, not with standing the deregulation of the economy, banking is yet regarded as one of the most controlled or regulated in Nigeria. In monetary amendment guideline circular No 21 of January, 1987 the central bank of Nigeria (CBN) quoted as this in order to enhance the development of financial position and achieve a realistic resource allocation, the following change effected all control on interest rates were then removed in line tooth the emphresis on deregulation of the economy the second condition without in order to server as a signed to the desired direction of interest rate changes, the minimum rediscount rate would continue to be fixed by the central bank. This has gone further to show the benefits of commercial banks in the growth of the country’s economy. This is because in spite of the deregulation in the whole economy. The banks are still kept in check always and forced to operate within the policies of the monetary authorities.
1.2 STATEMENT OF THE PROBLEM
In Nigeria, as in most other developing countries of the world, poor banking awareness (especially in the rural areas) and under-litches militating against economic development. This ugly trend is as a result of poor and under develop banking system which has been identified for long. Actually, failure to develop a favourable bank lending policies and implication was pointed out as a major short coming of the west African currency Board (WACB) promoting the establishment of the central bank of Nigeria in 1958.
It was in 1937 that internal autonomy was achieved another commission was set up. During this period the federal government engaged the service of another financial expert of the bank of England, Mr. J.B. Loynes, it was his recommendation that led to the establishment of the central bank of Nigeria by the central bank of Nigeria ordinance of 17th march, 1959. it commenced of N1.5million of which N1.25 million was the amount paid up what infact appears annoying is that since the establishment of central Bank, the problem has remained unsolved despite all efforts made so far to get the bank improved in tending policies in Nigeria.
According to Iheneta (1988) he said that banks should shoulder some more social responsibilities to the shareholders. “It must be realized that bank are not charitable organizations like the international Red Cross”. They are in business to make profit and have compelling responsibilities to the their shareholders.
More so, the urge to a standard investigative research. A competitive Analysis of commercial banks lending policies and their implications.
1.3 OBJECTIVE OF THE STUDY
The aim of this research work is to undertake an in-depth analysis of the implications of lending policies on borrowers, commercial banks and the economy as a whole. Other specific objectives include:.
i. Assessing the extent to which commercial banks comply with statutory allocation of credit to the different sectors of the economy view the central bank credit guidelines.
ii. To test the rigidity of the commercial banks lending policies and their effect on the borrowing customers.
iii. To draw out lines of credit offered by these banks and their appraised process, highlighting the environmental influence that impinges on commercial banks lending policies in Nigeria.
Lending is of paramount importance in the economic hence the research work will investigate lending policies and practices of commercial banking system with country, finding out how realistic set making recommendation and suggesting ways to ensure effective implementation of those policies to achieve the desire objectives.
1.4 definition of terms
i. What is a bank: This is a financial institution that deals with money, in form of receiving drawing against such deposits on demand, issue of cheque and lending to customers.
ii. Financial intermediation: This is defined as the process by which financial houses serving as mediators accepts savings from individuals and house holds and lend these savings to the users.
iii. Funds mobilization: This is the process by which financial intermediaries put idle funds into effective use by collecting savings from those who have surplus idle funds (Net savers) and making them available to other (Net borrower’s) who need them for investment.
iv. loanable funds: This defined as the amount of bank founds which it can lend to its customers (or the public) at a particular time after making provision for legal reserve requirement.
v. Monetary policy:- It is a policy which deals with the discretionary control of money supply by the monetary authorities in order to achieve started or desired economic goals.
vi. Lending policy: The establishment of the direction and use of the funds from stock holder depositions others to control the composition and size of the loan portfolio and the determination of the general circumstance under which it is appropriated to make a loan. it is specifically designed by the management of the bank by which as lending practices are designed and controlled.
vii. Effective lending: A quantum of lending which maximizes the bankers objectives of liquidating and profitability and the economy’s objective of development.
viii. Lending: The facilities which a bankers offers to his customers or non-customer on the ground that such facility will be returned to the banker offer a specified time, on payment of some changes by the customers.
ix. PLC: Public Limited Company
x. CBN: Central Bank of Nigeria
Xi. WACB: West African Currency Board
Xii UBA: United Bank Of African PLC
Xiii. UBU Union Bank Of Nigeria.
HOW TO GET THE FULL PROJECT WORK
PLEASE, print the following instructions and information if you will like to order/buy our complete written material(s).
HOW TO RECEIVE PROJECT MATERIAL(S)
After paying the appropriate amount (#5000) into our bank Account below, send the following information to
08139462710 or 08137701720
(1) Your project topics
(2) Email Address
(3) Payment Name
(4) Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: COMMERCIAL BANKS LENDING POLICIES IN NIGERIA AND THEIR IMPLICATIONS (COMPAITIVE CASE STUDY OF THREE SELECTED COMMERICAL BANKS IN ENUGU ZONE
ABSTRACT
This topic was designed to highlight the importance and prominence budgeting in a very dynamic economy like ours as well as the difficulty to forecast the rate of inflation with accuracy and the problem posed by changing price level and how these problems are addressed in making budgeting decisions.
Highlighting the advantages as well as he problem associated with budgeting will enhance the managers skill and ability in the preparation and implementation of budgets. They will also see the correlation between budgeting and success as well as appreciate it students on the dynamics, complexities and mechanics of today’s business decision making. a part from making some contribution to knowledge, the study would also add to the existing. Finally, the study is significant as it is in partial fulfilment of award of (?) in Accountancy. This study report is five chapters. The first chapter introduces the topic, present the nature of the problem, the objective of the study significant of the study, the significant of the study the scope of the study as well as statement of hypothesis. The chapter also given a brief history of the company and the aware ship structure. Hence the first chapter serves as a prelude to the main study.
The second chapter examines the work of the other people on the study. Review is divided into sections top cover areas like of meaning and purposes of budget and the techniques of the data treatment will be explained and the limitation to which we are subjected in the data treatment. The data collected will be analyzed and discussed so as to develop our findings in the context of the purpose for which the study was conducted chapter four.
Here, the statement of fact in connection with the study will be made. The finding of the study will determine whether the hypothesis were true or not.
Finally, in chapter five, statement of findings is made, conclusion are draw remarks and recommendations based on the study are made.
TABLE OF CONTENTS
Title Page II
Approval page III
Certification IV
Dedication V
Acknowledgement VI
Abstract VIII
Table of contents X
CHAPTER ONE
1.0 Introduction 1
1.1 Background statement 1
1.2 Nature of the problem 3
1.3 Statement of hypothesis 5
1.4 Objective of the study 6
1.5 Research question 7
1.6 Significance of the study 8
1.7 Scope of the study 9
1.7.1 Brief history of the company 10
1.7.2 Ownership structure 11
1.8 Organisation of the study 11
1.9 Definition of terms 12
CHAPTER TWO
2.0 Review of related literature 16
2.1 Introduction 16
2.2 Meaning and purpose of budgeting 21
2.3 Types of budgeting 23
2.3.1 The operating budget 23
2.3.2 The finance budget 26
2.4 Stamps in preparing budget 28
2.5 Techniques of budget 29
2.6 Meaning of inflation 31
2.7 Rates of inflation 32
2.8 Types of inflation 33
2.9 Pos and cons inflation 35
2.10 causes of inflation 36
2.11 Control of inflation 39
2.12 How Binez Hotels Ltd, Aba take care of inflation in
their budgets. 40
2.13 Budget planning implementation and control in Binez Hotel Ltd. 41
2.14 Types of budget prepared in Binez hotel 42
2.15 Budget preparation implementation and control procedures in Binez Hotel Ltd. 43
2.16 Data presentation, interpretation and various analysis. 45
2.17 Summary 45
CHAPTER THREE
3.0 Research design and methodology 47
3.1 Research design 47
3.2 Area of study 48
3.3 Determination of sample size/population 48
3.4 Sample and sampling procedure 49
35 Types of data used 49
CHAPTER FOUR
4.0 Data presentation and analysis 53
CHAPTER FIVE
5.0 Findings, recommendation and conclusion 67
5.1 Introduction 67
5.2 Recommendations 69
5.3 Suggestions for further research 70
5.4 Summary/conclusion 71
Bibliography 72
Appendix 77
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND STATEMENT
The concept of budgeting is as old man. In history, we learnt that the early man had to determine whatever he needed in advance before it eventually materialized. This very obvious in the present days in lives of individual, a state or a nation, as nation plans ahead in terms of revenue and disbursements within a specified period of time. Every establishment, be it public or private, finds it necessary to prepare budget and institutes budgetary control for the purpose of translating policies the best possible activities as well as financial control in order to achieve the best result. A budget had been defined as “a financial and /or quantitative statement prepared and approved prior to a defined period of time of the policy to be pursed during that period for the purpose of attaining a given objective. It may include income, expenditure and the employment of capital. The institute of cost of management accountants (ICMA) defines budgeting control as’ the et of departmental budgets relating the responsibilities of executives to the requirements of a policy and the continuous comparison of actual with budgeted results, either to serve by individual action the objective of that policy or to provide a firm basis for its revision. In a nutshell a budget is a permute which measures the actual achievement of people , artments, ministries, firms etc.
Statement for review and control purposes. These financial statement as a guide to chief executives had of parastatals etc. In the operation of the resources at their disposals.
However, in recent times, increases in the general level of prices has in no small way unlimited the numerous advantages of budgeting planning as well as increased the degree instability and uncertainly in the business environment. No rigid reliance on budgeting as a management tool to provide direction basis for performance appraisal and for profit measurement can be grossly misleading inflationary result in reduced profits. It can equally create a false sense of well being for a company. For instance, where a company makes holding gains by merely deliberately holding its stock and reselling at a much higher price when actual supervisor managerial ability has not been demonstrated nor has capacity utilization or sale volume increased. Also during inflation, the value of fixed assets are usually understated because the replacement or current cost of the assets are usually higher than their book values. This is turn understates the amount of deprecation charged for these assets and consequently overstate profit. The distribution of this Phony profit as dividends may result in capital depletion. This a negation of fundamental principle of income determination, which state that provision should be made to maintain the of existing capital intact.
Budgeting in an inflationary environment therefore requires considerable forecasting and predication of the economic, social political, and even legal trends in the business environment and their impact on both the centre economic factor in today’s activities of the particular business enterprise. As a recurring factor in business environment the need to recognize and incorporate inflationary pressure in budgeting decision is therefore very paramount.
1.2 NATURE OF THE PROBLEMS
The dynamic complex, unstable and competitive environment under which Nigerian operates to day has made advance planning very crucial and infact a key factor for success. a business plan is usually actualized through the use of a budget. However, no matter how through and painstaking the preparation of a budget may be unforeseen fluctuations in general price level may cause unfavourable distributions or deviations between actual and budgeted activities.
As a result of the dire need to plan effectively and keep pace with developments in the business environment, the following problems are addressed.
- Inflationary pressures are incorporated in budgeting decision.
- This is no flexibility in the preparation and implementation of budgets in order to contain changes in volume of activities or other variables.
- To de-emphasis the under reliance on historical cost accounting be it presents a worry picture of the state of affairs in on inflationary environment as a result of the decline in the purchasing power of money during inflation.
- Also the need to de-emphasis the use of budgets as the sole basis for performance evolution inspite of the deviations and fluctuations which price level increases or even decreases can create.
1.3 STATEMENT OF HYPOTHESIS
All scientific enquires are geared towards providing or disproving a phenomone or a preconceived notion about issues social. Scientific, economic or political. The particular issue to be examined and the objective of the inquiry often deman the formulation of certain hypothesis which would be validated or disproved through the scientific testing of the data generated from that enquiry. Hypothesis in this case refers to tentative statement of fact that is subject to empirical validation by treating.
The following are the hypothesis to be tested.
1. Ho: Increased in the general price level do not affect
budgeting decision in Binez Hotel Ltd Aba.
Hi: Increased in the general price level affect
budgeting decision in Binez Hotel Ltd Aba.
2. Ho: A company cannot succeed without budgeting.
Hi: A company can succeed without budgeting.
3. Ho: Variance between actual and budgeted revenue and
expenditure in Binez hotel are accounted for by inflation.
Hi: Variance between actual and budgeted revenue and
expenditure in Binez hotel are accounted for by inflation.
1.4 OBJECTIVE OF THE STUDY
The use budgeting as on indispensable managerial tool in today’s business decision, has become very necessary as a result of the highly competitive and complex business environment under while business operate. The risk of just forging ahead without a concrete plan is enormous. Businessmen and investors fear leaving their fortunes to chance. To survive an remain profitable, a business must continually assess its strengths and weaknesses, its current position, where it is today where it wants to be tomorrow, the means of getting there well as the constraints that ill militate these goals and objective and how to contain them.
The objective of the research, which is conducted with particular reference to Binez Hotel Ltd Aba include the following:
- To examine the procedure and techniques employed by the economy in budgeting decision.
- To examine how the management of Binez Hotel copes with inflationary pressures in its periodic budgeting decisions.
- To examine to problem posed by inflation in the economy generally and Binez Hotel Ltd in particular and how it is addressed.
- To find out the possibility of the company to operate without budgeting its activities in today’s uncertain business environment.
- The study will equally evaluate the soundness or otherwise of the budgeting procedures employed by Binez Hotel ltd Aba.
1.5 RESEARCH QUESTION
- The what extent has procedure and technique employed by the company influenced its budgeting decision.
- How to periodic budgeting decision copes inflationary pressure in Binez Hotel Ltd.
- How to Binez operate without budgeting its activities.
- To what extent has budgeting procedure by Binez Hotel evaluate its operations.
1.5 SIGNIFICANCE OF THE STUDY
This topic was designed to highlighted the importance and prominence of budgeting in a very dynamic economy like ours as well as the difficulty to forecast the rate of inflation with accuracy and the problems posed by changing price levels and how those problem are addressed in making budgeting decisions.
Highlighting the advantages as well as the problems associated with budgeting will enhance the managers skill and ability in the preparation and implementation of budgets. They will also see the correlation between budgeting and success as well as appreciate its difficulties during inflation.
The study is also intended to enrich students on the dynamics, complexities and mechanics of today’s business decision making. Apart from making some contribution to knowledge, the study would also add to the existing body of knowledge, and literature in the subject area of budgeting finally the study is significant as it is in partial fulfilment of the Polytechnics requirements for the award of a Higher National Diploma (HND) in Accountancy.
1.7 SCOPE OF THE STUDY
The subject matter of the research budgeting in an inflationary environment is broad so that a very comprehensive and detailed analysis of its may not possible because of the limitations on its volumes as well as the constraints of time and money. In order to make the cost the result affordable and to be able to finish within the short time available, the study was restricted only to Binez Hotels Ltd Aba.
The finding from the research may be peculiar to the company under study only and may not have necessarily represented the situation or what is obtainable in similar comprises in the same or related industry. Therefore the result cannot be very confidently generalized but may indicate a picture. The result study examined the types of budgets and the types of budgetary. Preparation and procedures adopted by Binez Hotel Ltd Aba. The study equally elicited answers form questionnaires administered on how Binez Hotel addresses the problem of inflation in it budgeting decision.
Finally a comparative analysis of the budgeted and actual revenue and expenditure of the company of company for the period of 1997 – 2000 was also made.
1.7.1 BRIEF HISTORY OF THE COMPANY
What we now know as Binez Hotel ltd was formally called Binez Hotels and was incorporated a private limited liability company in 1997, with an authorized share capital of N3,000,000 with ordinary share of N1.00 each.
Following the advent of a new Binez Hotels the share capital was increased to N50,000,000 with an ordinary share of N1.00 each issued and fully paid in.
1.7.2 OWNERSHIP STRUCTURE
The company is owned by Nze Dr C. O. Maduako with directors of which he is also one of them. The directors are:
Nze (Dr) Maduako
Late joy Maduako
Bar Chimezic Ogiabo
Mr. Uchenna Maduako
Mr. Nnanna maduako
1.8 ORGANISATION OF THE STUDY
This study report is in five chapter introduces the topic present the nature of the problem the objective of the study significance of the study the scope of study as well as statement of hypothesis. The chapter also gives a brief industry of the company and ownership structure. Hence this first chapter serves as a pretend to the main study.
The second chapter examines the work of other people on study review of related literature. This chapter is divided into section to conver area like meaning and purpose of budget and the techniques of budgeting, it also cover the meaning types and pros and constitution of inflation.
The third chapter deals with the methodology of research. In this chapter, the source of data and method of collection will be discussed analytical techniques of the data treatment will be explained and the limitation to which we are subjected to the data treatment. The data collected will be analyzed and discussed so as to develop our finding in the context of the purpose for which the study was conducted in chapter four.
Here he statement of fact in connection with the study will be made the finding of the study will determine whether the hypothesis were true or not.
Finally in chapter five statement of finding is made conclusion are draw remarks and recommendation based on the study are made.
1.9 DEFINITION OF TERMS
In this research study, the following words terms or concepts are used either in a bread or restricted sense.
A. BUDGET
This refers to a quantitative and financial expression of a future plan of action. The chaptered institute of management accountant s (CIMA) defined, it as a plan quantified in monetary term prepared and approved prior to defined period of term usually showing planned income to be generated and/or the expenditure incurred during that period and the capital to be employed to attain a given objective.
B. BUDGETING
This is the process of predicting the financial behaviour of a business enterprise over a specified period of time.
C. BUDGETING CONTROL
This has been defined as the establishment of department budgets relating the responsibilities of executive to the requirement of a policy, and the continuous comparison of actual with budgeted result, either top to secure by individual action the objective of that policy or to provide a firm basis for its revision in a nutshell budgetary control ensures that actual result are positively in accordance with the overall financial and policy objective of an establishment.
D. INFLATION
This refers to the rise in the general level of prices in the economy as a whole as distinct from a rise in the level of prices in a given sector of the economy in other words, inflation is a high and persistent rise in the general price level. But not all price increase are inflationary for example an increase in the price level, which is not remnant, cannot be regarded as inflationary. When the price level is rising very rapidly – hyper inflation or galloping inflation. When it is rising gently – creeping inflation.
E. EFFICIENCY
This simple means the accomplishment of desired objective with minimum resources or lost.
F. EFFECTIVENESS
This term is defined as the degree success with which a give objective is accomplished.
G. HOLDING GAINS
Profit arising during inflationary periods as a result of just holding goods in stock and not from the or ordinary occurs of business.
H. VARIABLE
This refers to the difference between actual and budgeted activity or performance.
HOW TO GET THE FULL PROJECT WORK
PLEASE, print the following instructions and information if you will like to order/buy our complete written material(s).
HOW TO RECEIVE PROJECT MATERIAL(S)
After paying the appropriate amount (#3000) into our bank Account below, send the following information to
08139462710 or 08137701720
(1) Your project topics
(2) Email Address
(3) Payment Name
(4) Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: BUDGETING IN ALL INFLATIONARY ENVIRONMENT (A CASE STUDY OF BINEZ HOTELS LTD ABA)
ABSTRACT
This topic was designed to highlight the importance and prominence budgeting in a very dynamic economy like ours as well as the difficulty to forecast the rate of inflation with accuracy and the problem posed by changing price level and how these problems are addressed in making budgeting decisions.
Highlighting the advantages as well as he problem associated with budgeting will enhance the managers skill and ability in the preparation and implementation of budgets. They will also see the correlation between budgeting and success as well as appreciate it students on the dynamics, complexities and mechanics of today’s business decision making. a part from making some contribution to knowledge, the study would also add to the existing. Finally, the study is significant as it is in partial fulfilment of award of (?) in Accountancy. This study report is five chapters. The first chapter introduces the topic, present the nature of the problem, the objective of the study significant of the study, the significant of the study the scope of the study as well as statement of hypothesis. The chapter also given a brief history of the company and the aware ship structure. Hence the first chapter serves as a prelude to the main study.
The second chapter examines the work of the other people on the study. Review is divided into sections top cover areas like of meaning and purposes of budget and the techniques of the data treatment will be explained and the limitation to which we are subjected in the data treatment. The data collected will be analyzed and discussed so as to develop our findings in the context of the purpose for which the study was conducted chapter four.
Here, the statement of fact in connection with the study will be made. The finding of the study will determine whether the hypothesis were true or not.
Finally, in chapter five, statement of findings is made, conclusion are draw remarks and recommendations based on the study are made.
TABLE OF CONTENTS
Title Page II
Approval page III
Certification IV
Dedication V
Acknowledgement VI
Abstract VIII
Table of contents X
CHAPTER ONE
1.0 Introduction 1
1.1 Background statement 1
1.2 Nature of the problem 3
1.3 Statement of hypothesis 5
1.4 Objective of the study 6
1.5 Research question 7
1.6 Significance of the study 8
1.7 Scope of the study 9
1.7.1 Brief history of the company 10
1.7.2 Ownership structure 11
1.8 Organisation of the study 11
1.9 Definition of terms 12
CHAPTER TWO
2.0 Review of related literature 16
2.1 Introduction 16
2.2 Meaning and purpose of budgeting 21
2.3 Types of budgeting 23
2.3.1 The operating budget 23
2.3.2 The finance budget 26
2.4 Stamps in preparing budget 28
2.5 Techniques of budget 29
2.6 Meaning of inflation 31
2.7 Rates of inflation 32
2.8 Types of inflation 33
2.9 Pos and cons inflation 35
2.10 causes of inflation 36
2.11 Control of inflation 39
2.12 How Binez Hotels Ltd, Aba take care of inflation in
their budgets. 40
2.13 Budget planning implementation and control in Binez Hotel Ltd. 41
2.14 Types of budget prepared in Binez hotel 42
2.15 Budget preparation implementation and control procedures in Binez Hotel Ltd. 43
2.16 Data presentation, interpretation and various analysis. 45
2.17 Summary 45
CHAPTER THREE
3.0 Research design and methodology 47
3.1 Research design 47
3.2 Area of study 48
3.3 Determination of sample size/population 48
3.4 Sample and sampling procedure 49
35 Types of data used 49
CHAPTER FOUR
4.0 Data presentation and analysis 53
CHAPTER FIVE
5.0 Findings, recommendation and conclusion 67
5.1 Introduction 67
5.2 Recommendations 69
5.3 Suggestions for further research 70
5.4 Summary/conclusion 71
Bibliography 72
Appendix 77
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND STATEMENT
The concept of budgeting is as old man. In history, we learnt that the early man had to determine whatever he needed in advance before it eventually materialized. This very obvious in the present days in lives of individual, a state or a nation, as nation plans ahead in terms of revenue and disbursements within a specified period of time. Every establishment, be it public or private, finds it necessary to prepare budget and institutes budgetary control for the purpose of translating policies the best possible activities as well as financial control in order to achieve the best result. A budget had been defined as “a financial and /or quantitative statement prepared and approved prior to a defined period of time of the policy to be pursed during that period for the purpose of attaining a given objective. It may include income, expenditure and the employment of capital. The institute of cost of management accountants (ICMA) defines budgeting control as’ the et of departmental budgets relating the responsibilities of executives to the requirements of a policy and the continuous comparison of actual with budgeted results, either to serve by individual action the objective of that policy or to provide a firm basis for its revision. In a nutshell a budget is a permute which measures the actual achievement of people , artments, ministries, firms etc.
Statement for review and control purposes. These financial statement as a guide to chief executives had of parastatals etc. In the operation of the resources at their disposals.
However, in recent times, increases in the general level of prices has in no small way unlimited the numerous advantages of budgeting planning as well as increased the degree instability and uncertainly in the business environment. No rigid reliance on budgeting as a management tool to provide direction basis for performance appraisal and for profit measurement can be grossly misleading inflationary result in reduced profits. It can equally create a false sense of well being for a company. For instance, where a company makes holding gains by merely deliberately holding its stock and reselling at a much higher price when actual supervisor managerial ability has not been demonstrated nor has capacity utilization or sale volume increased. Also during inflation, the value of fixed assets are usually understated because the replacement or current cost of the assets are usually higher than their book values. This is turn understates the amount of deprecation charged for these assets and consequently overstate profit. The distribution of this Phony profit as dividends may result in capital depletion. This a negation of fundamental principle of income determination, which state that provision should be made to maintain the of existing capital intact.
Budgeting in an inflationary environment therefore requires considerable forecasting and predication of the economic, social political, and even legal trends in the business environment and their impact on both the centre economic factor in today’s activities of the particular business enterprise. As a recurring factor in business environment the need to recognize and incorporate inflationary pressure in budgeting decision is therefore very paramount.
1.2 NATURE OF THE PROBLEMS
The dynamic complex, unstable and competitive environment under which Nigerian operates to day has made advance planning very crucial and infact a key factor for success. a business plan is usually actualized through the use of a budget. However, no matter how through and painstaking the preparation of a budget may be unforeseen fluctuations in general price level may cause unfavourable distributions or deviations between actual and budgeted activities.
As a result of the dire need to plan effectively and keep pace with developments in the business environment, the following problems are addressed.
- Inflationary pressures are incorporated in budgeting decision.
- This is no flexibility in the preparation and implementation of budgets in order to contain changes in volume of activities or other variables.
- To de-emphasis the under reliance on historical cost accounting be it presents a worry picture of the state of affairs in on inflationary environment as a result of the decline in the purchasing power of money during inflation.
- Also the need to de-emphasis the use of budgets as the sole basis for performance evolution inspite of the deviations and fluctuations which price level increases or even decreases can create.
1.3 STATEMENT OF HYPOTHESIS
All scientific enquires are geared towards providing or disproving a phenomone or a preconceived notion about issues social. Scientific, economic or political. The particular issue to be examined and the objective of the inquiry often deman the formulation of certain hypothesis which would be validated or disproved through the scientific testing of the data generated from that enquiry. Hypothesis in this case refers to tentative statement of fact that is subject to empirical validation by treating.
The following are the hypothesis to be tested.
1. Ho: Increased in the general price level do not affect
budgeting decision in Binez Hotel Ltd Aba.
Hi: Increased in the general price level affect
budgeting decision in Binez Hotel Ltd Aba.
2. Ho: A company cannot succeed without budgeting.
Hi: A company can succeed without budgeting.
3. Ho: Variance between actual and budgeted revenue and
expenditure in Binez hotel are accounted for by inflation.
Hi: Variance between actual and budgeted revenue and
expenditure in Binez hotel are accounted for by inflation.
1.4 OBJECTIVE OF THE STUDY
The use budgeting as on indispensable managerial tool in today’s business decision, has become very necessary as a result of the highly competitive and complex business environment under while business operate. The risk of just forging ahead without a concrete plan is enormous. Businessmen and investors fear leaving their fortunes to chance. To survive an remain profitable, a business must continually assess its strengths and weaknesses, its current position, where it is today where it wants to be tomorrow, the means of getting there well as the constraints that ill militate these goals and objective and how to contain them.
The objective of the research, which is conducted with particular reference to Binez Hotel Ltd Aba include the following:
- To examine the procedure and techniques employed by the economy in budgeting decision.
- To examine how the management of Binez Hotel copes with inflationary pressures in its periodic budgeting decisions.
- To examine to problem posed by inflation in the economy generally and Binez Hotel Ltd in particular and how it is addressed.
- To find out the possibility of the company to operate without budgeting its activities in today’s uncertain business environment.
- The study will equally evaluate the soundness or otherwise of the budgeting procedures employed by Binez Hotel ltd Aba.
1.5 RESEARCH QUESTION
- The what extent has procedure and technique employed by the company influenced its budgeting decision.
- How to periodic budgeting decision copes inflationary pressure in Binez Hotel Ltd.
- How to Binez operate without budgeting its activities.
- To what extent has budgeting procedure by Binez Hotel evaluate its operations.
1.5 SIGNIFICANCE OF THE STUDY
This topic was designed to highlighted the importance and prominence of budgeting in a very dynamic economy like ours as well as the difficulty to forecast the rate of inflation with accuracy and the problems posed by changing price levels and how those problem are addressed in making budgeting decisions.
Highlighting the advantages as well as the problems associated with budgeting will enhance the managers skill and ability in the preparation and implementation of budgets. They will also see the correlation between budgeting and success as well as appreciate its difficulties during inflation.
The study is also intended to enrich students on the dynamics, complexities and mechanics of today’s business decision making. Apart from making some contribution to knowledge, the study would also add to the existing body of knowledge, and literature in the subject area of budgeting finally the study is significant as it is in partial fulfilment of the Polytechnics requirements for the award of a Higher National Diploma (HND) in Accountancy.
1.7 SCOPE OF THE STUDY
The subject matter of the research budgeting in an inflationary environment is broad so that a very comprehensive and detailed analysis of its may not possible because of the limitations on its volumes as well as the constraints of time and money. In order to make the cost the result affordable and to be able to finish within the short time available, the study was restricted only to Binez Hotels Ltd Aba.
The finding from the research may be peculiar to the company under study only and may not have necessarily represented the situation or what is obtainable in similar comprises in the same or related industry. Therefore the result cannot be very confidently generalized but may indicate a picture. The result study examined the types of budgets and the types of budgetary. Preparation and procedures adopted by Binez Hotel Ltd Aba. The study equally elicited answers form questionnaires administered on how Binez Hotel addresses the problem of inflation in it budgeting decision.
Finally a comparative analysis of the budgeted and actual revenue and expenditure of the company of company for the period of 1997 – 2000 was also made.
1.7.1 BRIEF HISTORY OF THE COMPANY
What we now know as Binez Hotel ltd was formally called Binez Hotels and was incorporated a private limited liability company in 1997, with an authorized share capital of N3,000,000 with ordinary share of N1.00 each.
Following the advent of a new Binez Hotels the share capital was increased to N50,000,000 with an ordinary share of N1.00 each issued and fully paid in.
1.7.2 OWNERSHIP STRUCTURE
The company is owned by Nze Dr C. O. Maduako with directors of which he is also one of them. The directors are:
Nze (Dr) Maduako
Late joy Maduako
Bar Chimezic Ogiabo
Mr. Uchenna Maduako
Mr. Nnanna maduako
1.8 ORGANISATION OF THE STUDY
This study report is in five chapter introduces the topic present the nature of the problem the objective of the study significance of the study the scope of study as well as statement of hypothesis. The chapter also gives a brief industry of the company and ownership structure. Hence this first chapter serves as a pretend to the main study.
The second chapter examines the work of other people on study review of related literature. This chapter is divided into section to conver area like meaning and purpose of budget and the techniques of budgeting, it also cover the meaning types and pros and constitution of inflation.
The third chapter deals with the methodology of research. In this chapter, the source of data and method of collection will be discussed analytical techniques of the data treatment will be explained and the limitation to which we are subjected to the data treatment. The data collected will be analyzed and discussed so as to develop our finding in the context of the purpose for which the study was conducted in chapter four.
Here he statement of fact in connection with the study will be made the finding of the study will determine whether the hypothesis were true or not.
Finally in chapter five statement of finding is made conclusion are draw remarks and recommendation based on the study are made.
1.9 DEFINITION OF TERMS
In this research study, the following words terms or concepts are used either in a bread or restricted sense.
A. BUDGET
This refers to a quantitative and financial expression of a future plan of action. The chaptered institute of management accountant s (CIMA) defined, it as a plan quantified in monetary term prepared and approved prior to defined period of term usually showing planned income to be generated and/or the expenditure incurred during that period and the capital to be employed to attain a given objective.
B. BUDGETING
This is the process of predicting the financial behaviour of a business enterprise over a specified period of time.
C. BUDGETING CONTROL
This has been defined as the establishment of department budgets relating the responsibilities of executive to the requirement of a policy, and the continuous comparison of actual with budgeted result, either top to secure by individual action the objective of that policy or to provide a firm basis for its revision in a nutshell budgetary control ensures that actual result are positively in accordance with the overall financial and policy objective of an establishment.
D. INFLATION
This refers to the rise in the general level of prices in the economy as a whole as distinct from a rise in the level of prices in a given sector of the economy in other words, inflation is a high and persistent rise in the general price level. But not all price increase are inflationary for example an increase in the price level, which is not remnant, cannot be regarded as inflationary. When the price level is rising very rapidly – hyper inflation or galloping inflation. When it is rising gently – creeping inflation.
E. EFFICIENCY
This simple means the accomplishment of desired objective with minimum resources or lost.
F. EFFECTIVENESS
This term is defined as the degree success with which a give objective is accomplished.
G. HOLDING GAINS
Profit arising during inflationary periods as a result of just holding goods in stock and not from the or ordinary occurs of business.
H. VARIABLE
This refers to the difference between actual and budgeted activity or performance.
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No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: BUDGETING IN ALL INFLATIONARY ENVIRONMENT (A CASE STUDY OF BINEZ HOTELS LTD ABA)
ABSTRACT
This topic was designed to highlight the importance and prominence budgeting in a very dynamic economy like ours as well as the difficulty to forecast the rate of inflation with accuracy and the problem posed by changing price level and how these problems are addressed in making budgeting decisions.
Highlighting the advantages as well as he problem associated with budgeting will enhance the managers skill and ability in the preparation and implementation of budgets. They will also see the correlation between budgeting and success as well as appreciate it students on the dynamics, complexities and mechanics of today’s business decision making. a part from making some contribution to knowledge, the study would also add to the existing. Finally, the study is significant as it is in partial fulfilment of award of (?) in Accountancy. This study report is five chapters. The first chapter introduces the topic, present the nature of the problem, the objective of the study significant of the study, the significant of the study the scope of the study as well as statement of hypothesis. The chapter also given a brief history of the company and the aware ship structure. Hence the first chapter serves as a prelude to the main study.
The second chapter examines the work of the other people on the study. Review is divided into sections top cover areas like of meaning and purposes of budget and the techniques of the data treatment will be explained and the limitation to which we are subjected in the data treatment. The data collected will be analyzed and discussed so as to develop our findings in the context of the purpose for which the study was conducted chapter four.
Here, the statement of fact in connection with the study will be made. The finding of the study will determine whether the hypothesis were true or not.
Finally, in chapter five, statement of findings is made, conclusion are draw remarks and recommendations based on the study are made.
TABLE OF CONTENTS
Title Page II
Approval page III
Certification IV
Dedication V
Acknowledgement VI
Abstract VIII
Table of contents X
CHAPTER ONE
1.0 Introduction 1
1.1 Background statement 1
1.2 Nature of the problem 3
1.3 Statement of hypothesis 5
1.4 Objective of the study 6
1.5 Research question 7
1.6 Significance of the study 8
1.7 Scope of the study 9
1.7.1 Brief history of the company 10
1.7.2 Ownership structure 11
1.8 Organisation of the study 11
1.9 Definition of terms 12
CHAPTER TWO
2.0 Review of related literature 16
2.1 Introduction 16
2.2 Meaning and purpose of budgeting 21
2.3 Types of budgeting 23
2.3.1 The operating budget 23
2.3.2 The finance budget 26
2.4 Stamps in preparing budget 28
2.5 Techniques of budget 29
2.6 Meaning of inflation 31
2.7 Rates of inflation 32
2.8 Types of inflation 33
2.9 Pos and cons inflation 35
2.10 causes of inflation 36
2.11 Control of inflation 39
2.12 How Binez Hotels Ltd, Aba take care of inflation in
their budgets. 40
2.13 Budget planning implementation and control in Binez Hotel Ltd. 41
2.14 Types of budget prepared in Binez hotel 42
2.15 Budget preparation implementation and control procedures in Binez Hotel Ltd. 43
2.16 Data presentation, interpretation and various analysis. 45
2.17 Summary 45
CHAPTER THREE
3.0 Research design and methodology 47
3.1 Research design 47
3.2 Area of study 48
3.3 Determination of sample size/population 48
3.4 Sample and sampling procedure 49
35 Types of data used 49
CHAPTER FOUR
4.0 Data presentation and analysis 53
CHAPTER FIVE
5.0 Findings, recommendation and conclusion 67
5.1 Introduction 67
5.2 Recommendations 69
5.3 Suggestions for further research 70
5.4 Summary/conclusion 71
Bibliography 72
Appendix 77
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND STATEMENT
The concept of budgeting is as old man. In history, we learnt that the early man had to determine whatever he needed in advance before it eventually materialized. This very obvious in the present days in lives of individual, a state or a nation, as nation plans ahead in terms of revenue and disbursements within a specified period of time. Every establishment, be it public or private, finds it necessary to prepare budget and institutes budgetary control for the purpose of translating policies the best possible activities as well as financial control in order to achieve the best result. A budget had been defined as “a financial and /or quantitative statement prepared and approved prior to a defined period of time of the policy to be pursed during that period for the purpose of attaining a given objective. It may include income, expenditure and the employment of capital. The institute of cost of management accountants (ICMA) defines budgeting control as’ the et of departmental budgets relating the responsibilities of executives to the requirements of a policy and the continuous comparison of actual with budgeted results, either to serve by individual action the objective of that policy or to provide a firm basis for its revision. In a nutshell a budget is a permute which measures the actual achievement of people , artments, ministries, firms etc.
Statement for review and control purposes. These financial statement as a guide to chief executives had of parastatals etc. In the operation of the resources at their disposals.
However, in recent times, increases in the general level of prices has in no small way unlimited the numerous advantages of budgeting planning as well as increased the degree instability and uncertainly in the business environment. No rigid reliance on budgeting as a management tool to provide direction basis for performance appraisal and for profit measurement can be grossly misleading inflationary result in reduced profits. It can equally create a false sense of well being for a company. For instance, where a company makes holding gains by merely deliberately holding its stock and reselling at a much higher price when actual supervisor managerial ability has not been demonstrated nor has capacity utilization or sale volume increased. Also during inflation, the value of fixed assets are usually understated because the replacement or current cost of the assets are usually higher than their book values. This is turn understates the amount of deprecation charged for these assets and consequently overstate profit. The distribution of this Phony profit as dividends may result in capital depletion. This a negation of fundamental principle of income determination, which state that provision should be made to maintain the of existing capital intact.
Budgeting in an inflationary environment therefore requires considerable forecasting and predication of the economic, social political, and even legal trends in the business environment and their impact on both the centre economic factor in today’s activities of the particular business enterprise. As a recurring factor in business environment the need to recognize and incorporate inflationary pressure in budgeting decision is therefore very paramount.
1.2 NATURE OF THE PROBLEMS
The dynamic complex, unstable and competitive environment under which Nigerian operates to day has made advance planning very crucial and infact a key factor for success. a business plan is usually actualized through the use of a budget. However, no matter how through and painstaking the preparation of a budget may be unforeseen fluctuations in general price level may cause unfavourable distributions or deviations between actual and budgeted activities.
As a result of the dire need to plan effectively and keep pace with developments in the business environment, the following problems are addressed.
- Inflationary pressures are incorporated in budgeting decision.
- This is no flexibility in the preparation and implementation of budgets in order to contain changes in volume of activities or other variables.
- To de-emphasis the under reliance on historical cost accounting be it presents a worry picture of the state of affairs in on inflationary environment as a result of the decline in the purchasing power of money during inflation.
- Also the need to de-emphasis the use of budgets as the sole basis for performance evolution inspite of the deviations and fluctuations which price level increases or even decreases can create.
1.3 STATEMENT OF HYPOTHESIS
All scientific enquires are geared towards providing or disproving a phenomone or a preconceived notion about issues social. Scientific, economic or political. The particular issue to be examined and the objective of the inquiry often deman the formulation of certain hypothesis which would be validated or disproved through the scientific testing of the data generated from that enquiry. Hypothesis in this case refers to tentative statement of fact that is subject to empirical validation by treating.
The following are the hypothesis to be tested.
1. Ho: Increased in the general price level do not affect
budgeting decision in Binez Hotel Ltd Aba.
Hi: Increased in the general price level affect
budgeting decision in Binez Hotel Ltd Aba.
2. Ho: A company cannot succeed without budgeting.
Hi: A company can succeed without budgeting.
3. Ho: Variance between actual and budgeted revenue and
expenditure in Binez hotel are accounted for by inflation.
Hi: Variance between actual and budgeted revenue and
expenditure in Binez hotel are accounted for by inflation.
1.4 OBJECTIVE OF THE STUDY
The use budgeting as on indispensable managerial tool in today’s business decision, has become very necessary as a result of the highly competitive and complex business environment under while business operate. The risk of just forging ahead without a concrete plan is enormous. Businessmen and investors fear leaving their fortunes to chance. To survive an remain profitable, a business must continually assess its strengths and weaknesses, its current position, where it is today where it wants to be tomorrow, the means of getting there well as the constraints that ill militate these goals and objective and how to contain them.
The objective of the research, which is conducted with particular reference to Binez Hotel Ltd Aba include the following:
- To examine the procedure and techniques employed by the economy in budgeting decision.
- To examine how the management of Binez Hotel copes with inflationary pressures in its periodic budgeting decisions.
- To examine to problem posed by inflation in the economy generally and Binez Hotel Ltd in particular and how it is addressed.
- To find out the possibility of the company to operate without budgeting its activities in today’s uncertain business environment.
- The study will equally evaluate the soundness or otherwise of the budgeting procedures employed by Binez Hotel ltd Aba.
1.5 RESEARCH QUESTION
- The what extent has procedure and technique employed by the company influenced its budgeting decision.
- How to periodic budgeting decision copes inflationary pressure in Binez Hotel Ltd.
- How to Binez operate without budgeting its activities.
- To what extent has budgeting procedure by Binez Hotel evaluate its operations.
1.5 SIGNIFICANCE OF THE STUDY
This topic was designed to highlighted the importance and prominence of budgeting in a very dynamic economy like ours as well as the difficulty to forecast the rate of inflation with accuracy and the problems posed by changing price levels and how those problem are addressed in making budgeting decisions.
Highlighting the advantages as well as the problems associated with budgeting will enhance the managers skill and ability in the preparation and implementation of budgets. They will also see the correlation between budgeting and success as well as appreciate its difficulties during inflation.
The study is also intended to enrich students on the dynamics, complexities and mechanics of today’s business decision making. Apart from making some contribution to knowledge, the study would also add to the existing body of knowledge, and literature in the subject area of budgeting finally the study is significant as it is in partial fulfilment of the Polytechnics requirements for the award of a Higher National Diploma (HND) in Accountancy.
1.7 SCOPE OF THE STUDY
The subject matter of the research budgeting in an inflationary environment is broad so that a very comprehensive and detailed analysis of its may not possible because of the limitations on its volumes as well as the constraints of time and money. In order to make the cost the result affordable and to be able to finish within the short time available, the study was restricted only to Binez Hotels Ltd Aba.
The finding from the research may be peculiar to the company under study only and may not have necessarily represented the situation or what is obtainable in similar comprises in the same or related industry. Therefore the result cannot be very confidently generalized but may indicate a picture. The result study examined the types of budgets and the types of budgetary. Preparation and procedures adopted by Binez Hotel Ltd Aba. The study equally elicited answers form questionnaires administered on how Binez Hotel addresses the problem of inflation in it budgeting decision.
Finally a comparative analysis of the budgeted and actual revenue and expenditure of the company of company for the period of 1997 – 2000 was also made.
1.7.1 BRIEF HISTORY OF THE COMPANY
What we now know as Binez Hotel ltd was formally called Binez Hotels and was incorporated a private limited liability company in 1997, with an authorized share capital of N3,000,000 with ordinary share of N1.00 each.
Following the advent of a new Binez Hotels the share capital was increased to N50,000,000 with an ordinary share of N1.00 each issued and fully paid in.
1.7.2 OWNERSHIP STRUCTURE
The company is owned by Nze Dr C. O. Maduako with directors of which he is also one of them. The directors are:
Nze (Dr) Maduako
Late joy Maduako
Bar Chimezic Ogiabo
Mr. Uchenna Maduako
Mr. Nnanna maduako
1.8 ORGANISATION OF THE STUDY
This study report is in five chapter introduces the topic present the nature of the problem the objective of the study significance of the study the scope of study as well as statement of hypothesis. The chapter also gives a brief industry of the company and ownership structure. Hence this first chapter serves as a pretend to the main study.
The second chapter examines the work of other people on study review of related literature. This chapter is divided into section to conver area like meaning and purpose of budget and the techniques of budgeting, it also cover the meaning types and pros and constitution of inflation.
The third chapter deals with the methodology of research. In this chapter, the source of data and method of collection will be discussed analytical techniques of the data treatment will be explained and the limitation to which we are subjected to the data treatment. The data collected will be analyzed and discussed so as to develop our finding in the context of the purpose for which the study was conducted in chapter four.
Here he statement of fact in connection with the study will be made the finding of the study will determine whether the hypothesis were true or not.
Finally in chapter five statement of finding is made conclusion are draw remarks and recommendation based on the study are made.
1.9 DEFINITION OF TERMS
In this research study, the following words terms or concepts are used either in a bread or restricted sense.
A. BUDGET
This refers to a quantitative and financial expression of a future plan of action. The chaptered institute of management accountant s (CIMA) defined, it as a plan quantified in monetary term prepared and approved prior to defined period of term usually showing planned income to be generated and/or the expenditure incurred during that period and the capital to be employed to attain a given objective.
B. BUDGETING
This is the process of predicting the financial behaviour of a business enterprise over a specified period of time.
C. BUDGETING CONTROL
This has been defined as the establishment of department budgets relating the responsibilities of executive to the requirement of a policy, and the continuous comparison of actual with budgeted result, either top to secure by individual action the objective of that policy or to provide a firm basis for its revision in a nutshell budgetary control ensures that actual result are positively in accordance with the overall financial and policy objective of an establishment.
D. INFLATION
This refers to the rise in the general level of prices in the economy as a whole as distinct from a rise in the level of prices in a given sector of the economy in other words, inflation is a high and persistent rise in the general price level. But not all price increase are inflationary for example an increase in the price level, which is not remnant, cannot be regarded as inflationary. When the price level is rising very rapidly – hyper inflation or galloping inflation. When it is rising gently – creeping inflation.
E. EFFICIENCY
This simple means the accomplishment of desired objective with minimum resources or lost.
F. EFFECTIVENESS
This term is defined as the degree success with which a give objective is accomplished.
G. HOLDING GAINS
Profit arising during inflationary periods as a result of just holding goods in stock and not from the or ordinary occurs of business.
H. VARIABLE
This refers to the difference between actual and budgeted activity or performance.
HOW TO GET THE FULL PROJECT WORK
PLEASE, print the following instructions and information if you will like to order/buy our complete written material(s).
HOW TO RECEIVE PROJECT MATERIAL(S)
After paying the appropriate amount (#5000) into our bank Account below, send the following information to
08139462710 or 08137701720
(1) Your project topics
(2) Email Address
(3) Payment Name
(4) Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: BUDGETING IN ALL INFLATIONARY ENVIRONMENT (A CASE STUDY OF BINEZ HOTELS LTD ABA)
ABSTRACT
The economy of Nigeria has a lot of structural distortion is the 1980’s. The economy policies pursued prior to 1985 made the Nigeria economy price distortions created by a highly over-valued currency and inappropriate pricing of agricultural and other local products.
The control measure introduced prior to deregulation of the economy were unable to improve the economy positively, instead, that period was characterized by short- supply of industrial inputs. Plant closure, large retrenchment of workers, shortage of goods and price inflation with unfavourable balance of payment.
The Federal Government has pursued vigorously the policy of deregulation of the economy. The structural adjustment programme was designed to attack and remove the Fundamental structural distortions prevalent in the Nigeria economy. Commercial banks should equally anticipate and sensitize itself with the challenges of a deregulated economy.
The major deregulation policies used were deregulation of interest rates structure, introduction of second tier foreign exchange market.
Since the Federal Government is contemplating deregulation as the only paramount solution to the distorted economic structure. The banking Industry (Commercial Banks) need to reposition itself to take full advantage of the gains that might arise from such deregulation. Commercial banks should equally anticipate and sensitize itself with the challenges of a deregulated economy.
APPENDIX 11
QUESTIONAIRE ADMINISTERD AMONG THE BANKING PUBLIC
Dear sir/ Madam,
This questionnaire is part of a research into the impact of interest rate deregulation on commercial banks lending operations in Nigeria
The research is in partial fulfillment of the requirement for the a ward of a Higher National Diploma (H.N.D) In Banking and Financial Department
Kindly read each question and briefly express your opinion, your honest and Unbiased opinion is highly solicited for as they will help me with date will be treated in strict confidence.
Thanks for your cooperation.
NEAMADI CHIGOZIE .M.
TABLE OF CONTENT
Title page i
Approval page ii
Dedication iii
Acknowledgement iv
Abstract v
Table of contents vi
CHAPTER ONE
1.0 INTRODUCTION
1.1 Statement of problem
1.2 Purpose of study
1.3 Significance and relevance of study
1.4 Scope and limitation of study
1.5 Formulation of Hypothesis
1.6 Research methodology
1.7 Definition of terms
CHAPTER TWO
2.0 LITERATURE REVIEW
2.1. Conceptual framework
2.2. Empirical framework
CHAPTER THREE
3.0 RESEARCH METHODOLOGY
3.1 Research Designs
3.2 Sample size
3.3 Source of Data
3.4 Data Collection Method
3.5 Technique of Data Analysis
CHAPTER FOUR
4.0 DATA PRESENTATION AND ANALYSIS
4.1 Data presentation
4.2 Data Analysis
4.3 Test of Hypothesis
CHAPTER FIVE
5.0 SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 Summary of general findings
Conclusion
Recommendation
Bibliography
Appendix- Questionnaire
CHAPTER ONE
1.0 INTRODUCTION
The economy of Nigeria had a lot of structural distortions in the 1980s. The economic policies pursued prior to 1985 made the Nigeria economy vulnerable to external shock. Consequently the 1986 budget sought to de-emphasized controls and adopted policy measures aimed at expanding the economy resource balc. To attain this goal the 1986 budget at a tone in the structural adjustment programme which was launched in July 1980 with the introduction of structural adjustment programme came to deregulation of the Nigerian economy.
The deregulation policy which the structural adjustment called for is the process by process by which government remove selected regulations in bull-mess or order to encourage the efficient operation of market.
The theory is that fever regulations will lead to a raised level of competitiveness, therefore higher productivity, more efficiency and lower price overall. The deregulation policy was deigned to.
i. Restructure and diversity the productive base of the economy in order to reduce dependency on the oil sector.
ii. To achieve focal and balance of payment viability.
iii. To lay the basis for sustainable non- inflationary or minimal inflationary growth rate.
iv. To lesion the dominance of unproductive investment in the economy, improve the sectors efficiency and intensity the growth the sectors efficiency and intensity the growth potential of the private sector. The listed aims are not exhaustive.
The banking industry which is a major instrument through which government execute their policies, need to appropriately reposition itself to take full advantages of the gains that might arise from deregulation, as well as face the challenges.
Deregulation of the economy will definitely prose some challenges to the banking industry. However the ability to copy with the challenges which will come in the form competitive lending rates, effective management of credit risk, level of expertise in investment banking and cooperate finance activities will all be the important determinant of success for banks.
As a financial intermediary, commercial banks are expected to witness an increase in credit request with concessionaries interest rate. This is as a result of high rate of return that is expected from deregulation of the economy, especially toward deregulation of petroleum products which will definitely attract investors. This is where in the banking industry come in.
The project will therefore aim at analyzing the effect the deregulation of the economy will have on activated of commercial banks.
1.1 STATEMENT OF PROBLEM
Due to the underdeveloped nature of Nigeria banking system it is sometime said that banks have not met the standard expected to them in the process of economic development especially with the introduction of deregulatory policy. There are many problems which the commercial bank is not exception some of the problem to be treated in the text which of course threatens the financial performance of commercial banks are as follows.
The reluctant competition between commercial banks as a result of the deregulatory policy and the possibility of bank failure which prompted the Federal Government to establish the Nigeria Deposit insurance corporation.
i. Ability to cope with the high demand for bank loans with competitive lending rate.
ii. The level of expertise in investment banking and corporate finance.
iii. Ability to effectively manage credit risk these with other problems threatens the financial performance to commercial bank due to the introduction the deregulation of the economy.
1.2 PURPOSE OF THE STUDY
The general purpose of this study is to examine the performance of commercial banks under a deregulated economy with a view of assessing, the effect, challenges, and benefits as well as achievement such deregulation will pose on commercial banks.
This study attempt to critically identify and analyze the impact of government deregulation of the economy on commercial banks with the aim making useful recommendation son how to improve commercial bank performance.
Emphasis will also be made on the current banking practices and habit as means of battling with the challenges and the threats deregulation has brought with it. Also to identify the various achievements made with the inception of the policy as well as to examine how effective commercial banks have been since the inception of the policy.
Furthermore this text will try to compare the activities of commercial banks under the system of regulation and deregulation and deregulation in order to know if the main objective of the policy is been achieve. Recommendation that will enhance the efficiency of banks operations will equally be made.
1.3 SIGNIFICANCE AND RLEVANCE OF THE STUDY
The findings of this work will contribute to knowledge in the subject matter, other researcher students and the entire public will hopefully benefit from this study since it will form the basis for other research for other research work.
1.4 SCOPE AND LIMITATION OF THE STUDY
This study will cover a period of four year period (2000-2004) and a case study approach using first Bank Plc will be adopted. This project will concern itself with the financial performance of commercial banks as measured by a study of the effect of economic deregulation of the various activities of commercial banks.
In order to obtain a broader picture of the effect the deregulations of the economy have on commercial banks. Question arises will also be administer on some other selected banks, in Owerri.
However emphasis on the research will be based on First Bank of Nigeria Plc Owerri
The study will be constrained by the following:
i. The policies and conventions employed by first banks of Nigerian Plc will not necessary be the same as those used by other banks.
ii. The deregulation policies as used by the Federal Government through central bank of Nigeria on a regular basis. There is the possibility that not all policies will be available for this study.
iii. Lack of access to computation and compulsivity of handling multivariate data analysis may pole the greatest problem for the study.
Due to the time limitation and financial constraint it will not be possible in visit more than three commercial banks with concentration on first Bank of Nigeria Plc Owerri.
1.5 FORMILATION OF HYPOTHESIS
The following hypothesis will be tested.
i. The deregulation of the economy resulted in an upsurge I n the number of commercial banks in the country.
ii. The deregulation of the economy has resulted an increase in commercial banks profitability.
iii. Deregulation of the economy has led to a shape increase in banks bad and doubtful dept.
The research shall restrict itself with the use descriptive hypothesis. The null and alternative hypotheses which are normally used in statistical testing will be use, with null hypothesis represented as Ho and alternative hypothesis represented by H1.
1.6 RESEARCH METHODOLOGY
The research methodology will involve the collection of data through oral interviews to top management staff of some commercial banks, namely spring bank guarantee truest bank first ban al in Owerri.
Questionnaire will also be administered to the staff of there banks s well as the use of their financial statement. The researches will analysis the banks records from 200-2004 (A period of form years) both years inclusive.
The research will adopt the case study approach in its analysis and First Bank of Nigeria Plc, Owerri branch will be used as the case study. Major analysis will be based on information received from First Bank Plc, Owerri branch.
1.6 DEFINITION OF TERMS
1. Collateral: An item of value demanded by banks as security for loans granted to customers.
2. Credit: Money created by commercial banks through the media of loans and discounts granted to customers.
3. Data: Any kind of information (numerical or non- numerical) relevant to research.
4. Data Analysis: Critical examination of data with explanations and interpretations of research data.
5. Interview: Discullion or conference between two or more people either buy face to face or through a medium such at telephone.
6. Loan: Money lent to customer by banks
7. Over draft: Amount of money by which a bank account is been overdrawn by a customer.
8. Advance: Money paid before the due date.
9. Bank: An institution which borrows money from the public and also lend it to the public.
10. Commercial Bank: Banks designed to lend short term loan and overdraft to their customers.
11. Concept: A term having universal acceptable definition or meaning.
12. Delimitation and limitation: Constraints or problem the research encountered in the course of the research.
13. Population: Totality of all items under study.
14. Primary Data: Data that is made use of by the same person who collected it.
15. Research: Investigation under taking to discover or confirm the existence of something, or to get additional information or knowledge about something.
16. Methodology: Procedure and technique used, including problems encountered in the course of the research.
17. Questionnaire: List of questions in a printed form administered to respondents.
18. Sample: Traction or part of the population taken in a specified, manner.
19. Null Hypothesis: A statistical hypothesis formulated for the purpose of rejecting or nullifying the hypothesis.
20. Oval interview: Face to face interview with the respondent.
21. Respondent: People (Sample of the population) who respondent to the questionnaire or were interviewed.
22. Variable: Any feature possessed by members of a population that differed from one another.
23. Return: The measure of profitability on investment.
24. Ratio: A sample mathematical expression of the relationship of one item to the other.
25. Trend: Time movement in a set of observation taken at specified time period usually at equal intervals.
26. Interest Rate: Rental payment for the use of credit y borrows and returns for parting with liquidity by lenders.
HOW TO GET THE FULL PROJECT WORK
PLEASE, print the following instructions and information if you will like to order/buy our complete written material(s).
HOW TO RECEIVE PROJECT MATERIAL(S)
After paying the appropriate amount (#3000) into our bank Account below, send the following information to
08139462710 or 08137701720
(1) Your project topics
(2) Email Address
(3) Payment Name
(4) Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: THE IMPACT OF INTEREST RATE DEREGULATION ON COMMERCIAL BANKS LENDING OPERATIONS IN NIGERIA(CASE STUDY OF UNION BANK OF NIGERIA PLC)
ABSTRACT
The economy of Nigeria has a lot of structural distortion is the 1980’s. The economy policies pursued prior to 1985 made the Nigeria economy price distortions created by a highly over-valued currency and inappropriate pricing of agricultural and other local products.
The control measure introduced prior to deregulation of the economy were unable to improve the economy positively, instead, that period was characterized by short- supply of industrial inputs. Plant closure, large retrenchment of workers, shortage of goods and price inflation with unfavourable balance of payment.
The Federal Government has pursued vigorously the policy of deregulation of the economy. The structural adjustment programme was designed to attack and remove the Fundamental structural distortions prevalent in the Nigeria economy. Commercial banks should equally anticipate and sensitize itself with the challenges of a deregulated economy.
The major deregulation policies used were deregulation of interest rates structure, introduction of second tier foreign exchange market.
Since the Federal Government is contemplating deregulation as the only paramount solution to the distorted economic structure. The banking Industry (Commercial Banks) need to reposition itself to take full advantage of the gains that might arise from such deregulation. Commercial banks should equally anticipate and sensitize itself with the challenges of a deregulated economy.
APPENDIX 11
QUESTIONAIRE ADMINISTERD AMONG THE BANKING PUBLIC
Dear sir/ Madam,
This questionnaire is part of a research into the impact of interest rate deregulation on commercial banks lending operations in Nigeria
The research is in partial fulfillment of the requirement for the a ward of a Higher National Diploma (H.N.D) In Banking and Financial Department
Kindly read each question and briefly express your opinion, your honest and Unbiased opinion is highly solicited for as they will help me with date will be treated in strict confidence.
Thanks for your cooperation.
NEAMADI CHIGOZIE .M.
TABLE OF CONTENT
Title page i
Approval page ii
Dedication iii
Acknowledgement iv
Abstract v
Table of contents vi
CHAPTER ONE
1.0 INTRODUCTION
1.1 Statement of problem
1.2 Purpose of study
1.3 Significance and relevance of study
1.4 Scope and limitation of study
1.5 Formulation of Hypothesis
1.6 Research methodology
1.7 Definition of terms
CHAPTER TWO
2.0 LITERATURE REVIEW
2.1. Conceptual framework
2.2. Empirical framework
CHAPTER THREE
3.0 RESEARCH METHODOLOGY
3.1 Research Designs
3.2 Sample size
3.3 Source of Data
3.4 Data Collection Method
3.5 Technique of Data Analysis
CHAPTER FOUR
4.0 DATA PRESENTATION AND ANALYSIS
4.1 Data presentation
4.2 Data Analysis
4.3 Test of Hypothesis
CHAPTER FIVE
5.0 SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 Summary of general findings
Conclusion
Recommendation
Bibliography
Appendix- Questionnaire
CHAPTER ONE
1.0 INTRODUCTION
The economy of Nigeria had a lot of structural distortions in the 1980s. The economic policies pursued prior to 1985 made the Nigeria economy vulnerable to external shock. Consequently the 1986 budget sought to de-emphasized controls and adopted policy measures aimed at expanding the economy resource balc. To attain this goal the 1986 budget at a tone in the structural adjustment programme which was launched in July 1980 with the introduction of structural adjustment programme came to deregulation of the Nigerian economy.
The deregulation policy which the structural adjustment called for is the process by process by which government remove selected regulations in bull-mess or order to encourage the efficient operation of market.
The theory is that fever regulations will lead to a raised level of competitiveness, therefore higher productivity, more efficiency and lower price overall. The deregulation policy was deigned to.
i. Restructure and diversity the productive base of the economy in order to reduce dependency on the oil sector.
ii. To achieve focal and balance of payment viability.
iii. To lay the basis for sustainable non- inflationary or minimal inflationary growth rate.
iv. To lesion the dominance of unproductive investment in the economy, improve the sectors efficiency and intensity the growth the sectors efficiency and intensity the growth potential of the private sector. The listed aims are not exhaustive.
The banking industry which is a major instrument through which government execute their policies, need to appropriately reposition itself to take full advantages of the gains that might arise from deregulation, as well as face the challenges.
Deregulation of the economy will definitely prose some challenges to the banking industry. However the ability to copy with the challenges which will come in the form competitive lending rates, effective management of credit risk, level of expertise in investment banking and cooperate finance activities will all be the important determinant of success for banks.
As a financial intermediary, commercial banks are expected to witness an increase in credit request with concessionaries interest rate. This is as a result of high rate of return that is expected from deregulation of the economy, especially toward deregulation of petroleum products which will definitely attract investors. This is where in the banking industry come in.
The project will therefore aim at analyzing the effect the deregulation of the economy will have on activated of commercial banks.
1.1 STATEMENT OF PROBLEM
Due to the underdeveloped nature of Nigeria banking system it is sometime said that banks have not met the standard expected to them in the process of economic development especially with the introduction of deregulatory policy. There are many problems which the commercial bank is not exception some of the problem to be treated in the text which of course threatens the financial performance of commercial banks are as follows.
The reluctant competition between commercial banks as a result of the deregulatory policy and the possibility of bank failure which prompted the Federal Government to establish the Nigeria Deposit insurance corporation.
i. Ability to cope with the high demand for bank loans with competitive lending rate.
ii. The level of expertise in investment banking and corporate finance.
iii. Ability to effectively manage credit risk these with other problems threatens the financial performance to commercial bank due to the introduction the deregulation of the economy.
1.2 PURPOSE OF THE STUDY
The general purpose of this study is to examine the performance of commercial banks under a deregulated economy with a view of assessing, the effect, challenges, and benefits as well as achievement such deregulation will pose on commercial banks.
This study attempt to critically identify and analyze the impact of government deregulation of the economy on commercial banks with the aim making useful recommendation son how to improve commercial bank performance.
Emphasis will also be made on the current banking practices and habit as means of battling with the challenges and the threats deregulation has brought with it. Also to identify the various achievements made with the inception of the policy as well as to examine how effective commercial banks have been since the inception of the policy.
Furthermore this text will try to compare the activities of commercial banks under the system of regulation and deregulation and deregulation in order to know if the main objective of the policy is been achieve. Recommendation that will enhance the efficiency of banks operations will equally be made.
1.3 SIGNIFICANCE AND RLEVANCE OF THE STUDY
The findings of this work will contribute to knowledge in the subject matter, other researcher students and the entire public will hopefully benefit from this study since it will form the basis for other research for other research work.
1.4 SCOPE AND LIMITATION OF THE STUDY
This study will cover a period of four year period (2000-2004) and a case study approach using first Bank Plc will be adopted. This project will concern itself with the financial performance of commercial banks as measured by a study of the effect of economic deregulation of the various activities of commercial banks.
In order to obtain a broader picture of the effect the deregulations of the economy have on commercial banks. Question arises will also be administer on some other selected banks, in Owerri.
However emphasis on the research will be based on First Bank of Nigeria Plc Owerri
The study will be constrained by the following:
i. The policies and conventions employed by first banks of Nigerian Plc will not necessary be the same as those used by other banks.
ii. The deregulation policies as used by the Federal Government through central bank of Nigeria on a regular basis. There is the possibility that not all policies will be available for this study.
iii. Lack of access to computation and compulsivity of handling multivariate data analysis may pole the greatest problem for the study.
Due to the time limitation and financial constraint it will not be possible in visit more than three commercial banks with concentration on first Bank of Nigeria Plc Owerri.
1.5 FORMILATION OF HYPOTHESIS
The following hypothesis will be tested.
i. The deregulation of the economy resulted in an upsurge I n the number of commercial banks in the country.
ii. The deregulation of the economy has resulted an increase in commercial banks profitability.
iii. Deregulation of the economy has led to a shape increase in banks bad and doubtful dept.
The research shall restrict itself with the use descriptive hypothesis. The null and alternative hypotheses which are normally used in statistical testing will be use, with null hypothesis represented as Ho and alternative hypothesis represented by H1.
1.6 RESEARCH METHODOLOGY
The research methodology will involve the collection of data through oral interviews to top management staff of some commercial banks, namely spring bank guarantee truest bank first ban al in Owerri.
Questionnaire will also be administered to the staff of there banks s well as the use of their financial statement. The researches will analysis the banks records from 200-2004 (A period of form years) both years inclusive.
The research will adopt the case study approach in its analysis and First Bank of Nigeria Plc, Owerri branch will be used as the case study. Major analysis will be based on information received from First Bank Plc, Owerri branch.
1.6 DEFINITION OF TERMS
1. Collateral: An item of value demanded by banks as security for loans granted to customers.
2. Credit: Money created by commercial banks through the media of loans and discounts granted to customers.
3. Data: Any kind of information (numerical or non- numerical) relevant to research.
4. Data Analysis: Critical examination of data with explanations and interpretations of research data.
5. Interview: Discullion or conference between two or more people either buy face to face or through a medium such at telephone.
6. Loan: Money lent to customer by banks
7. Over draft: Amount of money by which a bank account is been overdrawn by a customer.
8. Advance: Money paid before the due date.
9. Bank: An institution which borrows money from the public and also lend it to the public.
10. Commercial Bank: Banks designed to lend short term loan and overdraft to their customers.
11. Concept: A term having universal acceptable definition or meaning.
12. Delimitation and limitation: Constraints or problem the research encountered in the course of the research.
13. Population: Totality of all items under study.
14. Primary Data: Data that is made use of by the same person who collected it.
15. Research: Investigation under taking to discover or confirm the existence of something, or to get additional information or knowledge about something.
16. Methodology: Procedure and technique used, including problems encountered in the course of the research.
17. Questionnaire: List of questions in a printed form administered to respondents.
18. Sample: Traction or part of the population taken in a specified, manner.
19. Null Hypothesis: A statistical hypothesis formulated for the purpose of rejecting or nullifying the hypothesis.
20. Oval interview: Face to face interview with the respondent.
21. Respondent: People (Sample of the population) who respondent to the questionnaire or were interviewed.
22. Variable: Any feature possessed by members of a population that differed from one another.
23. Return: The measure of profitability on investment.
24. Ratio: A sample mathematical expression of the relationship of one item to the other.
25. Trend: Time movement in a set of observation taken at specified time period usually at equal intervals.
26. Interest Rate: Rental payment for the use of credit y borrows and returns for parting with liquidity by lenders.
HOW TO GET THE FULL PROJECT WORK
PLEASE, print the following instructions and information if you will like to order/buy our complete written material(s).
HOW TO RECEIVE PROJECT MATERIAL(S)
After paying the appropriate amount (#10000) into our bank Account below, send the following information to
08139462710 or 08137701720
(1) Your project topics
(2) Email Address
(3) Payment Name
(4) Teller Number
We will send your material(s) immediately we receive bank alert
BANK ACCOUNTS
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 0046579864
Bank: GTBank.
OR
Account Name: AMUTAH DANIEL CHUKWUDI
Account Number: 2023350498
Bank: UBA.
HOW TO IDENTIFY SCAM/FRAUD
As a result of fraud in Nigeria, people don’t believe there are good online businesses in Nigeria.
But on this site, we have provided “table of content and chapter one” of all our project topics and materials in order to convince you that we have the complete materials.
Secondly, we have provided our Bank Account on this site. Our Bank Account contains all information about the owner of this website. For your own security, all payment should be made in the bank.
No Fraudulent company uses Bank Account as a means of payment, because Bank Account contains the overall information of the owner
CAUTION/WARNING
Please, DO NOT COPY any of our materials on this website WORD-TO-WORD. These materials are to assist, direct you during your project. Study the materials carefully and use the information in them to develop your own new copy. Copying these materials word-to-word is CHEATING/ ILLEGAL because it affects Educational standard, and we will not be held responsible for it. If you must copy word-to-word please do not order/buy.
That you ordered this material shows you have agreed not to copy word-to-word.
FOR MORE INFORMATION, CALL:
08139462710 or 08137701720
YOU CAN ALSO CALL:
08068231953, 08168759420
Visit any of our project websites below:
www.easyprojectmaterials.com
www.easyprojectmaterials.com.ng
www.easyprojectmaterial.net
www.easyprojectmaterial.net.ng
www.easyprojectsolutions.com
www.worldofnolimit.com
www.worldofnolimit.com
Tags: THE IMPACT OF INTEREST RATE DEREGULATION ON COMMERCIAL BANKS LENDING OPERATIONS IN NIGERIA(CASE STUDY OF UNION BANK OF NIGERIA PLC)
