استفاده از بودجه واحد برای برنامه ریزی و ارزیابی عملکرد
Abstract
1- Introduction
2- Hypotheses development
3- Method
4- Empirical results
5- Conclusion
References
Abstract
Budgeting has different functions in the firm that are not necessarily congruent with each other but conflict. In many firms, budgets are simultaneously used for both operative planning and performance evaluation. Although prior literature recommends using different budget levels for different purposes to resolve potential conflicts between these functions, empirical evidence indicates that most firms use a single budget level for planning and performance evaluation. To examine the questions of whether and why firms do so, we analyze potential costs emerging from these budgeting conflicts. We suggest that firms trade off these costs against the behavioral costs of reduced credibility when the performance evaluation budget deviates from the planning budget. We test our hypotheses using survey data from management accounting executives and find evidence for the predicted trade-offs. Moreover, we find that using a single budget level for both purposes at the beginning of the year does not imply using a single budget level at the end of the year as firms often adjust budgets differently for planning and performance evaluation. Our study contributes to the literature by reconciling discrepancies between descriptive empirical practice and recommendations from prior literature about the use of a single versus separate budgets for multiple purposes.
Introduction
Budgeting is one of the most important planning and control mechanisms firms employ (Luft & Shields, 2003; Merchant & Van der Stede, 2017). A challenging aspect of budgeting is that it often simultaneously serves multiple purposes in the firm. Specifically, in many firms, budgets are concurrently used for both planningoriented functions like forecasting of operative activities and performance evaluation-oriented functions like determining bonus payments (Becker, Mahlendorf, Schaffer, € & Thaten, 2016; Hansen & Van der Stede, 2004). These functions are distinct, not necessarily congruent and potentially conflicting. However, prior literature has largely neglected the questions of whether and why firms set the same level of budget targets or use different levels for these distinct, potentially conflicting functions. Therefore, this study investigates whether and why firms use either the same level of budget targets for operative planning and performance evaluation purposes (hereafter, use of a single budget) or different levels of budget targets for these two purposes (hereafter, use of separate budgets). Gaining insight into these questions is important for at least two reasons. First, prior literature has conflicting views on whether firms use or should use separate budgets for planning and performance evaluation. Some prior contributions emphasize that various budgeting functions are often in conflict, and therefore, the budgets used for these different purposes should differ to resolve these conflicts (Baiman, 1982; Barrett & Fraser, 1977; Hopwood, 1974; Otley, 1982).