MBA606: Financial Management Practices in Public Sector Budgeting

This report examines budgeting systems and practices within the public sector, focusing on the Fujairah Municipality in the United Arab Emirates. It investigates the impact of budgetary practices on public sector performance, considering factors such as political, economic, accounting, legal, and administrative departments. The research includes a literature review of five research papers and articles, analyzing how changes in budgetary practices affect accounting and performance. Data collection involves secondary data analysis of the Fujairah Municipality's practices, highlighting the shift from traditional methods to accrual-based accounting. The report concludes that budgetary practices have improved performance in the Fujairah Municipality and recommends their adoption across the public sector. The report also mentions the time scale for each activity in the research and the changes made in the Fujairah municipality because of the advanced technology and practices.

Running Head: Financial Management
1
Budgeting Systems or Practices in Public Sector

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Contents
Introduction:.....................................................................................................................3
Research question:............................................................................................................3
Literature review:..............................................................................................................3
Data collection and methodology:....................................................................................8
Time scale:........................................................................................................................9
Conclusion:.....................................................................................................................10
References.......................................................................................................................11

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Introduction:
Research topic for the report is “Budgeting system or practices in the public sector”.
Budgeting is a procedure which is systematically followed by the individual, organizations,
government and there in order to forecast the future performance and set the strategic goal
accordingly. Public sector develops the budgets in order to monitor and manage the progress
towards the objectives, goal and product the profits and future cash flows. The preparation
and presentation of budgetary reports are essential for the business and the public sector in
order to make the changes in the strategies and meet the goals of the business effectively.
In order to evaluate the impact of the budgeting process on the public sector, Fujairah
Municipality has been taken into the concern. Fujairah is an Arabic city which is located in
the United Arab of Emirates. The municipality department of the city has been studied in
order to evaluate that how the budgetary services have impacted on the public sector
performance. At the initial level, the municipality department used to prepare the budgetary
in order to forecast the future only. But along with the time, the political, economical,
accounting, legal and administrative department has also been taken into the concern to
measure the performance and the impact level. The budgetary report and the practices are the
most functional process in the business. The UAE market has faced huge changes and varies
in the budgetary practices and system in last few years.
Research question:
The main topic of the research is as follows:
 What is the impact of the budgetary practices in the public sector?
 How the practices affect over the budgetary performance in the public sector?
Literature review:
Literature review study has been done further in order to evaluate that what is the
budgetary practices and system and how it affect the public sector performance and their
process. In order to meet the answers of the research question, 5 research paper and articles

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have been studied and it has been found that how the changes in the practices affect the level
of the accounting practices:
Author
(year)
Dependent
variable
Independent
Variable
Sample Findings Further
Research
(Kerry
Jacobs,
2012)
Public
sector
accounting
and their
performance
Budgetary
practices and
system
Last 16 years
public sector
accounting
research
It has been
found that the
various
approaches
have been
adopted in last
few years
which have
made it easier
for the
accountant and
the
stakeholders to
understand the
performance
of the public
sector.
Though, few
factors have
not been
considered
while
conducting
the study
such as
requirement
of the
changes and
the
advancement
in the
budgetary
practices.
(Frank H.M.
Verbeeten,
2008)
Performance
management
practices in
the public
sector
Budgetary
practices and
system
The public
sector
department of
Netherlands
has been
taken as
sample for
the research
The research
report explains
that last 20
years were
significant for
the
Netherlands
market and in
these years,
various
Information
technology
and the
changes in
the auditing
practices
have not
been taken
into the

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positive
changes have
taken place in
the public
sector
performance
because of the
budgetary
system and
practices.
concern.
(EIJA M.
VINNARI
AND
SALME
NASI,
2008)
Public
sector
accounting
and their
performance
Budgetary
practices and
system
The primary
and
secondary
both the data
has been
taken into the
concern to
conduct the
study.
The paper
explains that
the budgetary
accounting
systems used
to focuses on
the revenues
and
expenditure.
But currently
accrual based
accounting
and budgetary
is used at most
in order to
manage the
economical
and political
performance
of the public
sector.
Because of the
Other
valuation
method and
economical
factors have
not been
studied in the
report.

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changes, the
opportunities
have also been
improved.
(Helen
Walker and
Stephen
Brammer,
2007)
United
kingdom
Public
sector
accounting
and their
performance
Budgetary
practices and
system
Questionnaire
and the
public sector
of UK was
the main
sample for
the study.
The research
paper explains
that barriers in
front of the
public sector
have been
removed
because of the
changes in the
public sector
of the
business. The
sustainable
procurement
has been seen
in the UK
public sector
companies
after the
changes in the
budgetary
practices and
the system.
The
corporate
social
responsibility
of public
sector has
been
eliminated in
the report.
(Stephen
Brammer,
2010)
Public
sector’s
procurement
Budgetary
practices and
system
280 articles
from the 20
countries
have been
The budgetary
system and the
practices are
crucial to
Advanced
changes and
the future
performance

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taken into the
context while
performing
the study.
make the
changes in the
decision level
and the
strategies of
public sector.
On the basis if
the budgetary
reports, the
revenue and
the
expenditure of
the public
sector is
managed.
have not
been studied
in the report.
Jacobs (2012) has conducted a research over the last 16 years public sector accounting
papers and it has been estimated that the organisational and political theories have been
changed and along with that the systems have also been altered. these changes have
positively impacted on the understanding level of the budgetary as well as because of these
changes, the budgetary reports in the public sector actually started making the sense. The
argument research has been done and it has been concluded that the changes are the essential
and the changes in the budgetary practices are impacting passively on the internal as well as
external stakeholders of the business.
Verbeeten (2008) explains that the Netherlands public sector companies have faced
various changes in last 20 years. The reasrch explains that the budgetary services have
impacted on the public sector performance. At the initial level, the public sector used to
prepare the budgetary in order to forecast the future only. But along with the time, the
political, economical, accounting, legal and administrative department has also been taken
into the concern to measure the performance and the impact level. Currently, the changes are
very positive in the Netherlands market and leads to the conclusion that the advances system
is useful for the public sector to maintain the performance level.

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Vinnari and Nasi (2008) have reported in their research paper that the budgetary
practices and sample are dependent variable because of that the performance of the public
sector has been affected at huge level. At earlier level, the budgetary accounting and systems
used to focuses on the revenues and expenditure. But currently accrual based accounting and
budgetary is used at most in order to manage the economical and political performance of the
public sector. Because of the changes, the opportunities have also been improved. The
preparation and presentation of budgetary reports are essential for the business and the public
sector in order to make the changes in the strategies and meet the goals of the business
effectively.
The report and the study explains that the changes have taken place into the budgetary
system and practices in last few years and these changes are significant for the public sector,
Because of these changes in the practice, it has been easier for the stakeholders and the other
parties to understand the changes and make the decisions accordingly. The study explains that
the current role of budgetary practices and system is crucial in the public sector. Public sector
develops the budgets in order to monitor and manage the progress towards the objectives,
goal and product the profits and future cash flows.
Data collection and methodology:
Research methodology:
Research methodology is a process which explains that what are the topics and methods
which must ne studied and followed in order to get an outcome about the research proposal.
In the paper, the changes in the Fujairah Municipality have been taken into the concern to
identify that how a budgetary system or practice affects the overall level of the public sector.
Along with the changes, the other characteristics, impact and other relatable factors have
been studied in the report. The main sample for the reasrch is changes in the Fujairah
Municipality because of the changes into the budgetary sector.
Data collection:
Data collection is a major topic in a research which evaluates available information or
gathers the information from the scrap to identify and evaluate the problem and reach over a
conclusion about the ain outcome from the issues. Mainly the data is collected by the
researches through 2 ways: Primary and secondary. Here, in this report, the secondary data

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has been taken into the concern and the already done research on the Fujairah Municipality
has been studied to identify that how the changes in the practices have affect the market
performance and stakeholder position of the public sector.
The Sarker & Al Athmay, (2018) has represented into his study that years before, the
public sector and the municipal department of the Fujairah used to follow the traditional
methods and the practices to strategise and forecast the future expenses on the basis of the
available revenue. Budgetary accounting and systems used to focuses on the revenues and
expenditure. But the current report of the Fujairah municipal part explains that the accrual
based accounting and budgetary is used at most in order to manage the economical and
political performance of the sector. Because of the changes, the opportunities have also been
improved. The preparation and presentation of budgetary reports are essential for the business
and the public sector in order to make the changes in the strategies and meet the goals of the
business effectively.
It has been measured that after implementation of the advanced technology and
practices in the municipal party of Fujairah, the successful reformation has been seen. These
reforms have been possible because of the political, accounting, auditor and the executive
support and co-operation among the internal stakeholders of the municipality. The changes
management practice of the Fujairah municipality made it easier for the public sector to
improve at better level.
Time scale:
The time scale study represent about the total time which has been taken to conduct
the study and reach over a conclusion. The below given time scale chart represent the total
time of each of the activity of the business:

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The time scale chart explains that the total time was limited for the research and thus
the quality of the conclusion could be affected because of it. Each of the activity has been
given average time from the available time to reach over a conclusion.
Conclusion:
To conclude, the budgetary practices in the municipal party of Fujairah, have
efficiently improved the performance. The changes management practice of the Fujairah
municipality made it easier for the public sector to improve at better level. It has been
concluded that the budgetary practices must be followed by each of the public sector to
improve the performance.

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References:
Brammer, S., (2011). Sustainable procurement in the public sector: an international
comparative study. International Journal of Operations & Production
Management, 31(4), 452-476.
Jacobs, K. (2012). Making sense of social practice: theoretical pluralism in public sector
accounting research. Financial Accountability & Management, 28(1), 1-25.
Sarker, A. E., & Al Athmay, A. A. A. R. A. (2018). The Changing Facets of Public
Administration in the United Arab Emirates. International Journal of Public
Administration, 41(10), 832-844.
Verbeeten, F. H. (2008). Performance management practices in public sector organizations:
Impact on performance. Accounting, Auditing & Accountability Journal, 21(3), 427-
454.
Vinnari, E. M., & Näsi, S. (2008). Creative accrual accounting in the public
sector:‘Milking’water utilities to balance municipal budgets and accounts. Financial
Accountability & Management, 24(2), 97-116.
Walker, H., & Brammer, S. (2009). Sustainable procurement in the United Kingdom public
sector. Supply Chain Management: An International Journal, 14(2), 128-137.