1. 
INTRODUCTION
Medium and small enterprises (SMEs) carry out a crucial
activity for promoting innovation, creating jobs and reducing unemployment and
divergence of inputs (Dzomonda & Fatoki, 2019). Additionally, a factor that
contributes to the low unemployment rates and progressive economic growth of
many modernized countries is the participation of SMEs (Awad-Warrad, 2018). For
the first half of 2023 in Colombia, small businesses represented 95.3% of the
corporate structure, small companies 3.5% and intermediate and large companies
represented 0.9% and 0.3% of the national measure. , correspondingly (MinCIT,
2023); For this reason, it registered 1,854,086 active companies as of March
2023, according to the most recent report from the Economic Studies Office of
the Ministry of Commerce, Industry and Tourism based on information from the
Single Business and Social Registry (RUES) and the Department National
Administrative Department of Statistics (DANE).
The economic-financial prospective continues its management
as it is a vital segment with an intrinsic aspect for making commercial
decisions in the generality of societies, including SMEs (Nguyen, 2019).
Despite this, investigations. They are still trying to find the best strategy
to implement this fundamental idea, and Colombia is no different. As a result,
it is necessary to identify the planning and procedures that currently exist
within these organizations, with a focus on capital budget planning and
procedures. Planning is essential for businesses to be successful and
long-lasting today.
Therefore, organizational management requires the synergy of
the undivided actors, in that context, the cardinal operations of the administrative
process (plan, organize, direct and control), their commitment value is to
compose each participant in the organization chart; but with a specific focus,
the projection assumes the work of locating the tasks of today, to obtain the
desired future (Señalin, et al. 2020). Thus, the budget, as a fundamental
instrument for the institutional mission, has been the subject of numerous
investigations; Hence, the accumulation of work regarding the budget issue has
been a formula for generating performance by managers. However, studies on the
positive and negative effects of the budget and on the role it plays and the
criticisms that can be directed at it remain contradictory in many aspects.
Today, management control must take into account many
different factors that lead to paradigmatic changes. Among these factors, for
example, Business Intelligence (BI), which “refers to all technologies that
allow companies to analyze data to benefit their decision-making. (Lebigdata,
2021). Therefore, budget control occupies an important place among the
techniques used in the projection and surveillance tasks of an organization.
Thus, another factor is Corporate Social Responsibility (CSR), which is
increasingly being developed in companies, either through legal obligations. In
this way, a first clue lies in the fact that most research on the budget does
not consider that it should be apprehended as a set of practices.
Therefore, professions such as accountants, administrators,
economists, financial administrators, among others, are constantly evolving; In
that sense, their budgeting is good for them. The missions of these management
professions, which until now were more dedicated to data mining, will evolve
towards performance management with the arrival of big data; Since, whoever
uses and says mission evolution, by default it entails normal skill evolution.
In a future where data mining will be automatic, the accountant, financial
administrator within management, must take a leadership position being a source
of proposals towards management, they must also be creative, have a spirit of
initiative and a great capacity for convictions (Bouquet, 2017).
In this regard, managing activities in the business community
has been a complex task due to the disruptive organizational environment, even
more so today in this situation of postmodernity and data intelligence.
However, most managers realize the importance of addressing organizational
performance through budget controls for short- and long-term success; but the
supply of goods is influenced and restricted by the lack of valuable
information and the innumerable trends that are necessary for the convenient
activity and development of the organizational sum of driving performance to
better productivity and decision making. In this way, the preparation of
budgets facilitates the achievement of the project in any institution if they
are within the objectives and goals set. Additionally, the budget helps control
the daily operations of any business; making the management of specific project
objectives achieved in a short period using available resources.
Establishing budgets allows you to outline current and future
resources to ensure they are in sync with the organization's objectives. In
general, the components of budget frameworks include budget planning, controls,
reviews, and implementation. According to Otieno (2019), budget control
measures involve continuous planning processes that offer information about the
real results expected against the planned budgets in any organization. In this
regard, following the uncertainties that prevail in the business environment of
organizations in Colombia and its regions today, managers and stakeholders must
be balanced and prepared to compete favorably in these rapidly changing
conditions. To survive under these complexities and environmental
uncertainties, managers and their stakeholders in MicroSMEs need suitable
tools, proven management techniques to forecast the main changes that are
likely to affect the business while choosing the future direction and the size
of resources necessary to achieve goals. selected.
In fact, some organizations only look at narrow ranges of
alternatives that they arrive at from their historical data and current
situation, other levels of management even eschew long-term planning and
budgeting in favor of today's problems, which It makes tomorrow's problems more
serious. The above reflects the need for organizations to establish a formal
mechanism to scan their environment for opportunities and give early signals of
future problems. This course of action will improve the budget and control
system, resulting in an adequate expectation of performance improvement.
The sum of knowledge is basically the objective of all
research and this work seeks to achieve precisely that. More importantly, this
construct is necessary to understand how budget control is established and also
how it affects organizational performance; Furthermore, it is a tool that
measures the management performance of an organization and promotes good morale
and harmony in the organization. Additionally, it allows the organization to
verify whether or not the organization's plans are understood by all members
and to implement corrective measures when over or under deviations occur.
Since, the budget is an instrument for business action, and financial
programming, and mainly helps organizations to grow, and therefore also the
economy of a region to grow, because when companies and businesses function
well, the economy will definitely do well.
Categorization
of variables
According to what is established by the technical-organizational-social
variables, they are formed with the financial results of economic entities and
are the place of exodus to improve standards; Through planning that drives
activities in accordance with the outlined strategy, obtaining better scope;
Finally, it can be checked to know the result and achieve the established
goals. Therefore, budget control is the ideal economic tool that allows
businesses to shape financial behaviors over time for the sake of their
objectives and economic performance and thus achieve their goals, using
instruments such as control, quality and coordination of the investment; In
this way, organizational development advances through strategic planning,
making administrative management effective.
Authors'
construction 2023
Budget control determines the effectiveness of an
organization's financial performance. For budget controls to be effective and
have an impact on the financial performance of the organization, there must be
factors that improve their work, such as effective budget control procedures
and techniques used to control it. Furthermore, the support and work of senior
management in budget control techniques has an impact on the success of the
budget control process and, therefore, increases the financial performance of the
organization. If budget controls are weak, this will hamper the financial
performance of the organization
2. LITERATURE REVIEW:
2.1 Capital budget theory
This study focuses on the projection function of capital.
Capital budgeting theory (CBT) is based on the premise that “organizations make
investment decisions based on maximizing wealth and increasing the value of the
organization” (Basch, 2017). Capital projection is the summary by which
organizations determine which investments will generate long-term returns.
Furthermore, maximizing the wealth of owners would not be the primary
achievable aspect of organizations, as owners should have significant autonomy
to pursue multiple objectives (Warren & Jack, 2018).
On the other hand, Li et al. (2020) that capital investment
decisions in small businesses differ from those in large businesses in several
aspects. First, small business owners are concerned not only about maximizing
wealth but also maintaining their independence, which can affect their
investment selections. Second, access to capital can pose an issue for small
business owners, which can influence decisions regarding liquidity and
maintaining cash reserves. Third, staffing limitations and lack of investment
experience may limit small business owners' ability to properly analyze
investment options.
This entails critical responsibilities for SME managers or
owners, as their capital budgeting decisions shape the future of their
companies in terms of productivity and growth (Oyelaran-Oyeyinka, 2020).
2.2 Management decision making
A higher percentage of SMEs have business ownership as sole
proprietorships and closely held corporations. Therefore, they are the only
ones who make decisions about budgeting practices. In SMEs, owners mostly opt
for cash flow budgeting instead of capital prospecting (Orobia et al.,2020). In
most situations, owners did not even implement capital budgeting due to their
stance on financial viability; not having capital to invest in new projects;
and a lack of knowledge about the entire capital budgeting process (Egbide et
al.,2019). Likewise, Bergeron and Gaboury (2020) point out and mention that the
rest of the SMEs, which applied the capital budgeting process for their
investment in new projects, did so through the assistance of external expert
consultants. Does management decision making play a key role in capital
budgeting practices and financial viability of SMEs?
2.3 General description of budget control
Budgetary control can be viewed as a cost review procedure
that encompasses budgeting, consistency of jurisdictions, and allocation of
assignments, comparing actual work with budgeted work, and acting on the
results to obtain the highest returns (Brown and Howard 2012) A budget provides
a detailed plan of action for a business over a defined period of time. For
effective budget control, an organization needs to prepare a detailed plan in
both financial and quantitative terms for the next financial period (Robinson
and Last 2009). According to Premchand (2004), the budget process is to plan
its preparation and establish goals and deadlines for its production. Budgeting
in the organization begins with the identification of the departments of an
organization and ends at the apex of the hierarchy.
2.4 Ability to control, direct, manage, direct and supervise
the workforce.
All SME personnel are essential to their operations. This
includes acquiring new people for the business and ensuring that they are
productive additions to the SME (Martínez-Costa et al.,2019). Effective human
resource management matches and then develops the skills of candidates and
staff with the needs of the business. An effective personnel system will
contribute to the key ingredients for survival, sustainability and growth
(Chams & García-Blandón,2019).
In that order, human resources management is a complementary
act. On the one hand, qualified personnel are employed who adapt well to the
needs of the company. At the other end, staff are trained and developed to meet
the needs of the business. Most small expanding businesses are between the two
levels (Bornay-Barracina et al.,2017). Under this criterion, the construct also
evaluates whether having advanced and modern accounting technology and software
positively influences planning and capital budgeting practices.
3. 
METHODOLOGY:
Given that the objective of the research was to assess budget
control and the reliability of its data as an alternative for organizational
performance in SMEs in the city of Ocaña-Colombia, based on the wealth of
information from a fairly large sample of 144 legally affiliated companies in
Chamber of Commerce. This study used the sample size to draw conclusions, so a
quantitative analysis was used as a research method, a descriptive design and
an instrument using the questionnaire were adopted; In this sense, a non-random
and intentional sample size was chosen for the survey among SMEs, likewise, the
use of quantitative analysis was the best strategy to guarantee the
measurability, accuracy and reliability of the findings. Collecting data from
each individual in this population was extremely difficult; Therefore, an
adequate anthology of information and a representative sample
of the population was made.In
that order, the validity of the study questionnaire was established from the
data, which met the Cronbach's alpha cut-off point of 0.70. SME owners or
appropriate representatives were given a five-point Likert scale-style
self-administered questionnaire to complete and collect data for the study.
Additionally, the questionnaires were distributed to the respondents for
completion. The data, which were converted into numerical values, were analyzed
using a scientific statistical analysis program; With the help of a SPSS
software configuration which offers advanced statistical analysis, and
installed on a computer system, the data acquired for this research was
analyzed.
4. RESULTS
AND DISCUSIÓN
The following questions and answers were discussed regarding
the influence of management/owners on current budget planning and practice. For
this reason, three dimensions were made, such as:
- Importance of the Budget
- Budget Sufficiency
- Budget Management
Table 1. Importance of the budget
Source: Construction of the authors.
Within the evaluation of the importance of the budget, it was
determined that the majority of the SMEs that accompanied the study do not have
projections as instruments of mission and action, as well as the low
probability of total execution of the budget during the year, which determines
the little interest as an instrument for making managerial decisions due to its
total lack of use of budget control, also within the interpretation of value to
the budget, it is linked to projected income, but it is not executed as an
evaluation and control policy in the micro-SMEs from Ocaña-Colombia.
According to Doncel and Montes (2017), the budget is “a
fundamental tool in business and financial management, which provides crucial
information for making strategic decisions.” By knowing the available
resources, financial limitations and established goals, more informed decisions
can be made, which is why it is necessary for SMEs to begin to see the budget
as a tool that allows them to evaluate performance and adjust strategies as
necessary.
Table 2. Budget
Sufficiency
Source: Construction of the authors.
In this dimension of budget management, it
was found that SMEs are aligned under organizational teleology, where their
causes of use of financial resources have an empirical effect of success
against their expenditures and obligations without determining their support
from budget control. ; In that order, they determine that they do not observe a
quantitative competitive advantage in developing the budget as a management
tool, because the majority of its owners have a limited training academy in the
field.
Table 3. Budget management
Source: Construction of the authors.
In this dimension of budget management, it was found that
SMEs are aligned under organizational teleology, where their causes of use of
financial resources have an empirical effect of success against their
expenditures and obligations without determining their support from budget
control. ; In that order, they determine that they do not observe a
quantitative competitive advantage in developing the budget as a management
tool, because the majority of its owners have a limited training academy in the
field.
financial management, where they visualize how to allocate
and guarantee the appropriate use of financial resources from one term to
another.
In this sense, Doncel and Montes (2017) affirm that budget
alignment within organizational teleology refers to how budgets are linked to
the final objectives and purposes of an organization. Organizational teleology
involves the idea that organizations have end goals toward which they tend and
that their actions, including budgeting, are oriented toward achieving those
goals.
In this context, SMEs must consider that economic foresight
is not simply an isolated financial tool, but rather is integrated into the
broader structure of the transcendental orientation of society. It is developed
with the purpose of achieving specific objectives, whether financial, growth,
expansion or any other nature, that are aligned with the business perspective
and mission. Organizational teleology implies that the budget is not only a
resource allocation tool, but rather becomes an instrument that guides the
company towards achieving its fundamental purposes. It is used to plan, control
and evaluate performance based on these long-term objectives (Parra and La
Madriz, 2017).
Graph 1. Dimensions
Source:
Construction of the authors.
In graph 1, the sufficiency of the budget is available as the
first place in the dimensions evaluated, in second place, the management of the
budget, and in third place the importance of the budget, which has the effect
of accompanying microentrepreneurs from the academy. to improve their financial
competencies and thus achieve better management skills in the use of budget
management in their businesses.
According to the above, the budget is a preparatory plan for
the costs, resources and income of the organization in accordance with the
financial capabilities and its objective is to develop and improve the
financial performance of the organization as defined (Mazikana 2019). Although
budget control aims to ensure that budget work does not deviate from the
established plan, the success of budget control has a direct effect on
increasing the financial performance of the company (Nafisatu 2018). Many
techniques and procedures to help the success of budget management and control
and increase its performance, which lead to accrediting the financial
performance of the microenterprise, such as planning, control and control
measures, which are of great importance in the success of control. budget (Kimani,
2014).
Therefore, the importance of using budget control techniques
due to their impact on raising the financial performance of the organization by
controlling the organization's costs, reviewing differences in the budget,
allocating its resources and choosing the best investments for the return on
investment. capital (Kabiru and Adah 2013). The importance of the role of
senior management in supporting the use of budget
management and control techniques has become evident, since
they have an impact on raising the financial performance of the company.
5. Conclusions
In this modern era of competition, along with the challenges
of globalization and borderless markets made possible by technology, this study
revealed that SMEs need special skills, namely, budget management and control
of their executives in order to sustain themselves. Likewise, the budget
process is fundamental for the performance of any organization. From the
literature reviewed, most studies showed a positive relationship between the
management and control of the budget and the performance of the organization.
But the research demonstrates the lack of senior management and their
collaborators who provide accounting advice, where they do not agree to
prepare, implement and evaluate the budget in an organization such as
microenterprises and SMEs. From the data analyzed, it was revealed that there
is a less than optimistic correlation between budget processes and the
performance of a company.
The results of this construct indicated that a large
percentage of SMEs are owned by sole proprietorships and closed corporations.
Executives are largely unaware of their creditworthiness, the various policies,
regulations and programs offered by government entities and the tax incentives.
6. 
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