a) i) Budgetary Control System

A Budgetary Control System is a systematic approach to planning, coordinating, and controlling business activities through the preparation of budgets, monitoring actual performance against budgeted targets, analyzing variances, and implementing corrective actions. It integrates financial planning with operational control to achieve efficiency and profitability, common in Ghanaian banks for compliance with BoG liquidity guidelines.

ii) Three ways Budgetary Control System helps provide information for operational efficiency:

1. Variance Analysis: It compares actual results with budgets to identify deviations, providing data on inefficiencies like excess spending on operations, enabling timely corrections to optimize resources.
2. Resource Optimization: By forecasting resource needs and monitoring usage, it supplies information to allocate resources effectively, reducing waste and improving productivity, e.g., in treasury operations to manage liquidity.
3. Performance Evaluation: It offers metrics for assessing departmental performance, highlighting areas of underperformance and facilitating data-driven decisions to enhance processes, such as in lending to reduce non-performing loans.

b) i) Consolidated Financial Statements

Consolidated Financial Statements are the combined financial statements of a parent company and its subsidiaries, presented as if the group is a single economic entity. They aggregate assets, liabilities, equity, income, expenses, and cash flows, eliminating intra-group transactions and balances to show the group’s overall financial position and performance.

ii) Four circumstances where control exists but no consolidation required:

1. Investment Entities Exception: If the parent is an investment entity (e.g., venture capital firm), it measures subsidiaries at fair value through profit or loss instead of consolidating, per IFRS 10.
2. Subsidiary Held for Sale: If the subsidiary meets the criteria for classification as held for sale under IFRS 5, it is not consolidated but presented as a disposal group.
3. Intermediate Parent Exemption: If the parent is a subsidiary of another entity that prepares IFRS-compliant consolidated statements available to the public, and certain conditions are met (e.g., no public debt, owner consent), it need not consolidate.
4. Immaterial Subsidiaries: While control requires consolidation, if the subsidiary is immaterial individually and collectively, it may not be consolidated in practice, though IFRS 10 requires consolidation unless exceptions apply; however, materiality may influence presentation.