Utilization in public organizations: a case study of dawuro zone finance and economic development department
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| 1.2 Statement of the Problem Despite the significance achievements of the Dawuro Zone Finance Economic Development Department in expanding its Economic, Social and Administrative programs, the allocation, management and utilization of regular budget by the Dawuro Zone Finance Economic Development Department have still significance challenges that need to be addressed. Indeed, Dawuro Zone Finance and Economic Development Department has institutionalized various reforms brought by the BoFED in its financial budgeting and utilization processes. Yet, evidences from the Dawuro Zone Finance and Economic Development Department’s annual accomplishment report show that the Dawuro zone Finance and Economy still faces some critical challenges when it comes to proper budgeting and effective utilization of the budget. For example, the 2005 and 2006 EC financial reports of the Dawuro zone finance and economic development show that over 3.67 and 4.56 million birr unspent budget has been returned to BoFED respectively. The existence of such fluctuation was observed in the finding of internal audit report of 2007 EC of Dawuro Zone finance and economy. This problem include under utilization of budget in some sectors while over utilization in others beyond the initially allocated budget reallocation without following proper procedure poor budget monitoring and control rushed spending of budget at the end of the year unsettled expenses and mismatches between expenditures and statements. 13 The consequences of such improper budget allocation and inefficient utilizations are many and far-reaching. Primarily, the under utilization of budget by some sectors as a result of the over budgeting or inefficiency in implementation diminishes the budget available for other sectors. The result leads to returning of substantial unspent budget to the BoFED which could have been to implement essential operations of the Dawuro zoneFEDD hindered by budget limitation had there been through budget allocation plan. Secondly, inefficient budget utilization by the Dawuro Zone FEDD or its sectors means lesser budget needed to the Dwuro zone FEDD in the next fiscal year. Thirdly, holding of sizable amount of money by the Dawuro zone budget holding sectors without timely utilization has a big cost to the region economy that otherwise could have been circulated or spent elsewhere for better value. On the other hand, proper budget allocation and efficient utilization has manifold importance. Firstly, it allows the Dawuro zone FEDD and its major budget holding sectors to operate effectively and achieve its desired goals. The result enhances institutional development of the Dawuro zone FEDD and improves contribution in the region’s development endeavor. Secondly, efficient and timely budget utilization by the Dawuro Zone Finance Economic Development Department means productive spending of public fund by the government. Thirdly, proper implementation and controlling of budget avoids mismanagement and misuse of scarce resources. The main research problem of this study that motivated the Researcher was therefore the lack of up-to-date and evidence based information and knowledge related regular budget allocation trends, utilization efficiency and financial management systems and associated problems in 14 the Dawuro Zone Finance Economic Development Department. Although there is little attention no emphasis given in budget allocation and utilization of Dawuro Zone. Moreover, there has not been any study that investigated the stated problem in DZFEDD. This critical gap of knowledge and practical solution to address the problems has in part limited the Dawuro Zone Finance Economic Development Department from realizing appropriate budget allocations, effective financial management and controlling systems as well as efficient budgetary resource utilizations. Ensuring proper budget allocation, management and efficient utilization in Dawuro Zone Finance Economic Development Department, however, requires improving the allocation, movelization and utilization of available budget resources. Such improvement may include study-based budget allocation, budget based expenditure, budget utilization monitoring and control, feedback and communication capacity building and awareness creation among financial management staff and utilizing sectors modification of monetary withdrawal and settling regulations under the umbrella of the BOFED & MOFED rules and regulations. Download 0.82 Mb. Share with your friends:
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