ABSTRACT Budgets have been defined as financial and/or quantitative statements prepared and approved prior to a specified period

of time, of the policy to be pursued during that period for the purposes of attaining given objectives. Budgets can achieve their purpose if right steps are taken in the budgetary process. The purpose of this study, therefore, is to take a critical look at budgetary process in manufacturing company using Tonga Company as a case study. Tonga Company was chosen because of the complex nature of its operations and the desire of the government to process at least sixty percent of cocoa beans produced in the country.

Personal interviews and questionnaires were administered to officials of Tonga Company as well as references made from libraries, journals, bulletins and Internet. This study revealed that even though the company is doing well financially, there are some shortfalls in its budgetary process. These shortfalls include: Lack of budget manual, failure to identify the budget-limiting factor, non-adherence to the proper preparation of sales and productions budgets, lack of training of staff on budget preparation, and non-participative budgetary process.

The management of Tonga Company should do everything possible to come out with Budget Manual, identify a budget-limiting factor. It is further recommended that management should not encourage closed lines of communication but enhance effective budgetary participation.