Analysis of the application of budgetary control in non-profit organisations : a case study of Adra Namibia

Abstract

Non-profit organisations (NPOs) are faced with difficulties in maintaining financial stability and sustainability due to lack of funding and poor resource management. This has resulted in failure and abandonment of various projects. Thus the aims of this paper are: to assess the significance of budgetary controls in reviewing the performance of NPOs in Namibia, to examine the challenges associated with designing, implementing budgets and budgetary controls in non-profit organisations and to evaluate whether the budget is regularly monitored against actual results. A qualitative case study design was used to get an in-depth understanding of the matter. The population comprised of all employees of ADRA in Namibia from which ten participants were chosen using non-probability purposive sampling. Data was collected by means of unstructured interviews. A narrative and thematic analysis was used to analyse the data. The findings revealed that ADRA has sound financial management due to functional and clear budgetary control procedures despite the challenges faced in designing and implementing budgetary measures and scarcity of resources in the NPO sector. Furthermore, budgetary controls at ADRA have provided a roadmap which is vital in achieving strategic goals and financial stability for the organization. Hence, NPOs should consider establishing board committees that are responsible for directing and approving the budgetary processes and constantly review the financial position of the organisation. Management should draw up a comprehensive budget policy manual that outlines the budgetary framework and the control thereof.