Utilization in public organizations: a case study of dawuro zone finance and economic development department
Budget control/performance monitoring
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- 2.4. Budget utilization
| 4. Budget control/performance monitoring This stage involves monitoring activities in terms of annual pubic bodies reports and audit reports to the parliament i.e. accounts for expenditure, evaluation and audit It also include activates such as ensuring whether the revenue utilization is according to the laws and 28 regulations, insuring that disbursement is made according to budget that public property is kept safe, and the recording and accounting procedures are up to standard. Wubeshet, (2002) 2.4. Budget utilization Budget utilization is a means as to what extent the funds originally allocated in the budget could be spent by the end of the fiscal year. The inadequacy of hard budget restraints on decision makers at the planning and budget formulation stage of the cycle leads to inadequate funding of operations, poor expenditure control and unpredictability in the flow of budgeted resources to agencies responsible for services delivery (Malcolm, 2003) When we see in the case of Ethiopian budget classification system, it is possible to see exactly which resources are assigned to which public bodies and to followup that the money has been used in accordance with their respective departments, programs projects and assigned responsibilities for their effective use. Once a budget has been approved by the legislature, the government embarks on the challenging task of spending funds. Utilizing public funds effectively to meet stated policy objectives while ensuring value for money is often just as challenging than planning how to spend it. Several reviews of public financial management performance in developing countries show that countries score significantly better on budget preparation than on budget utilizing. According to Schiavo-Compo and Tommasi (1999) budget utilization is the phase where resources are used to implement policies incorporated in the budget. As they argued, it is possible to utilize badly well prepared budget, it is not possible to utilize well a badly prepared budget. 29 As per Allen and Tommasi(2001), successful budget utilization depends on numerous factors, such as the ability to deal with changes in macroeconomic environment, and the implementation capacities of the agencies concerned. Beside to this, the budget system should assure effective expenditure control. In addition to realistic budget to begin with, a good budget utilization system should have complete budgetary appropriation accounting system. It is necessary to track to transactions at each stage of the expenditure cycle (commitment, verification, payment) and movements between appropriations or budget items .Schiavo- Compo and Tommasi(2001). Download 0.82 Mb. Share with your friends:
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