Abstract:
In the modern management, financial control is very important. If the financial control is
effective, the organization will grow effective in future. Financial control is one of the
performance control tool that are used by managers. Today many Public organizations
provide services to the public. Jaffna municipal council is a public organization that
deals with people of Jaffna city to fulfill their daily needs. The Jaffna municipal council
provides different services to the public and it faces many difficulties to manage these
activities. However it serves with the help of government grants and other funds from
various non government organizations it faces some problems regarding finance and
other physical resources. The purpose of this study is to analyze how the financial control
of the Jaffna municipal Council affects its organizational performance. For this purpose
two hypothesis were tested. One is “Effective budgetary control has positive impact on
its organizational performance” and other is “Effective financial control leads to better
organizational performance”. To test this hypothesis the data were obtained through
primary data such as interview, interrogation and discussions with financial officers and
from annual reports and statements as secondary data. Financial information is analyzed
by using various analysis methods. Ratio analysis, percentage analysis and gap analysis
are used to measure effectiveness of financial control. Organizational performance is
measured by budgetary control with the significance of variance. In this research, when
the budgetary control is ineffective the organizational performance based on budgetary
control is worst. And the effective financial control leads to better organizational
performance. Finally, this research has proved that there is positive relationship between
financial control and organizational performance and there is positive control and
relationship between budgetary control and organizational performance. So, It can be
concluded the public organization should take attention in the financial control to manage
the activities effectively.
