The Concept of Cost Consciousness in the Management of Public Funds

The Concept of Cost Consciousness in the Management of Public Funds

Cost consciousness in the management of public funds, therefore, relates to attitude to wards economy and reasonableness of public expenditure within a given budgets on a plan of action over a period of time to provide maximum benefits. Prudence and economy in the utilization of public funds are always very essential, and management assumes responsibility for this, this responsibility is accomplished by deploying resources to the proper arrangement for a given objective an mapped out goals.

To order the Complete Project Material, Pay thr Sum of N3,000 to:

BANK NAME: FIRST BANK PLC

ACCOUNT NAME:  CHIBUZOR TOCHI ONYEMENAM

ACCOUNT NUMBER: 3066880122

Then send the Project Topic, Your Email Address and Full Name to 07033378184.

 

It also entails that manages of public funds shared do it in trust for the public who rightly own these funds and there, should accept due responsibility for their stewardship.

It also operates on the basis of minimizing Cost and to do away with those that is unnecessary and which judges the performance of the subordinates and others by the same standard. It is aimed at designing the policy and operation of public fiance so as to achieve the maximum possible welfare or advantage for the society as a whole the dimensions of cost consciousness in the management of public funds includes, planning, programming, efficiency, effectiveness in the management of public funds to mention but a few.

SCHOOL OF THOUGHT WITHIN THE SUBJECT AREA

The information about cost is of vital importance to the manager choosing amongst alternatives and planning the optimum utilization of resources and knowing cost of each alternative is essential. Cost data are also needed to make decision such as pricing, volume, replacement, assets acquisition, product mix etc. the performance of executives and their subordinates can be evaluated and constructed only when compares between the costs actually incurred and the expenditure is made. Although, the term cost is commonly used for all, yet there is no unique concept of cost. Infact, different cost concept have been developed by different professors. In many different ways. Some costs are useful and required for inventory valuation and income determination, it also entails for planning budgeting and cost control and for long and short-term decisions.

The school of thought relevant to the problem of study:

Pandy defined standard cost as predetermined cost under given operating condition”.

A manufacturing enterprise would generally determine standard costs for direct material, direct labour and factory overhead. Past experience and data provide important closed for establishing standard cost, although, they are forecasted and planned scientifically. Budget is comprehensive terms which integrate cost and revenue aspects of an enterprises planned activities Budget cost are part of the budgeting process, they are costs expected to be in cured for the planned activities of an enterprise for specified period of time.

When a total cost charges in direct proportion to changes in volume, it is called a variable cost. Variable costs vary in proportion and palled manner with volume. An important feature of fixed cost hat totals fixed cost remains constant but fixed cost per unit decreases with increased volume.

According to him “controllable cost are those cost which can influence to real and significant extent by the authority or activities of an individual at a specific responsibility level within a specific time span. Those costs, which are not subjects to the direct authority and actions of an individual, are non-controllable at his level of responsibility. Funds are establishes in accordance with the requirements of the constitution, statutes, and charters, or in pursuance to action by the legislative body or the Chief executive.

State funds are established by Constitution or statues, although certain state funds may be set up by governors. Local government funds are established by statues. It is said that I quote “Responsibility without accountability is a sham, in other words, it implies prudent employment of scare resources-mene, machinery, material, money and moments which have countervailing claims to obtain optimum reward. Accountability is the answerability for one’s performance, in other words, public accountability is the process by which persons entrusted with public funds ensure that proper records of the disbursement of funds are kept.

Accounting can be distinguished in terms of:

  1. Expenditure of funds and procedure by which that expenditure is accounted for.
  2. Capacity to achieve results for a given expenditure of resources.

The first classification implied low the citizens funds entrusted in the hands of civil servants are being safeguarded and expended by considering accounting practices and reporting procedure. In the same way the directors of business organizations have to render accounts of stewardship to the shareholders a clear statement of purpose, which is understood by average in an organization, is necessary of effective administration. Infact, the more unified and concrete the objective the better, it is already noted that difficulty in defining its objectives id a problem facing government.  Next is the assessment of available alternative.

Different Method of Studying the problem

Planning is an intended course of action, a process proposed form commencement to fulfillment. Planning involves anticipating what will happen and deciding what will be done, who will do it and when.

A clear statement of purpose, which is understood by everyone in an organization, is necessary for effective administration. Infact, the more unified and concrete the objectives, the better. It is already noted that difficulty in defining its objectives is a problem facing the government.

Next is the assessment of available alternative. This would begin with an examination of present conditions and facilities, it is essential when planning t have knowledge of the existing situation. Here, the provision of problem solving information to management is very relevant, that is qualified information generated through the management accounting process, which measures the witness of each alternative course of action and thus guides management to choose the best alternative.

The third step is arranging for the necessary resources including human, financial and material.

Planning cold be made for the long range period or for short term, long term covers periods extending beyond one year, indeed a time to provide management with an opportunity to anticipate future problem and this to have a greater freedom of action to resolve them in an orderly manner.

Budget is an instrument of planning. Nay budget programme, which is well designed, will b on collective management mechanism for forecasting reliable goals over a definite period. So also will it be for planning and co-coordinating the various operations and functions of the business to achieve the goals.

In estimating expenditure for the current year, there are several factors to be considered, they may be guided to some extent by the expenditures of prior years.

There is need to know whether the origination unit will be called upon to render more or less services during the coming year, for instance, if the service is much that it expends the growth of the population, its expected to increase during he coming year, certain expenditures are not usually allocated to any particular function or organizational unit. For example, interest, contribution to pension funds etc, those expenditures are therefore prepared certain expenditures are not usually allocated to any particular function or organizational unit.

 Summary

The concept of cost consciousness in the management of public funds could be seen as the area to ensure that governmental funds are not misappropriated, regular audit should be carried out in an organizational or establishment, infact, cost consciousness helps in supervisory the correctness and the amount of money involved in carrying out projects by public servant.

The location of a particular project may require a greater or lesser investment in other public project then would otherwise be the case, and this must clearly be included in a full cost benefit analyzers. Where extra expenditure else where is engendered by the project and the second where the scheduling of another project is altered by this one.

The first occurs where the development of mining complex by the ministries if natural resources required that the ministry of transport construct improved roads ad bridges to carry heavy vehicles involved. In evaluating the performance of Enugu State ministry of finance and Economic planning, cost cones raise has derived into the Budgeted income and revenue, expenditures of the ministry.

—This article is not complete———–This article is not complete————
This article was extracted from a Project Research Work/Material Topic

THE CONCEPT OF COST CONSCIOUSNESS IN THE MANAGEMENT OF PUBLIC FUNDS

A CASE STUDY OF ENUGU STATE MINISTRY OF FINANCE AND ECONOMIC PLANNING.

Click Here To get the full Project Research Work/Material

To Get Business Administration Project Materials, Click Here!

The Concept of Cost Consciousness in the Management of Public Funds

To purchase complete Project Material, Pay the sum of N3, 000 to our bank accounts below:

BANK NAME: GUARANTY TRUST BANK (GTB)

ACCOUNT NAME: CHIBUZOR TOCHI ONYEMENAM

ACCOUNT NUMBER: 0044056891

OR

BANK NAME: FIRST BANK PLC

ACCOUNT NAME: CHIBUZOR TOCHI ONYEMENAM

ACCOUNT NUMBER: 3066880122

After paying the sum of N3, 000 into any of our bank accounts, send the below details to our Phone: 07033378184

  1. Your Depositors Name
  2. Teller Number
  3. Amount Paid
  4. Project Topic
  5. Your Email Address

Send the above details to: 07033378184 or on/before 24hours of payment. We will send your complete project materials to your email 30 Mins after payment.

Articlesng.com will only provide papers as a reference for your research. The papers ordered and produced should be used as a guide or framework for your own paper. It is the aim of Articlesng.com to only provide guidance by which the paper should be pursued. We are neither encouraging any form of plagiarism nor are we advocating the use of the papers produced herein for cheating.

Speak Your Mind

*