Abstract
ABSTRACT This article aims to analyze the mediating cognitive effects of vertical information sharing in the budgeting process on the relationship between budgetary participation and managerial performance. The behavioral literature in the area of accounting has diverged regarding the cognitive effects of budgetary participation on managerial performance. Evidence found in this literature reveals that there are possible intervening variables in this relationship that may influence the cognitive effects of participation on performance. Considering that budgetary participation can affect the cognition and performance of individuals at work, it is relevant to analyze the budget management practices adopted by organizations and the effects they have on individuals with budgetary responsibilities. The evidence found shows that an organization’s budgetary configuration influences the way information sharing will occur and will consequently have cognitive effects on managerial performance. This descriptive study was conducted by collecting data and employing a quantitative approach to analyze them, using structural equations modeling. The research sample comprised 316 respondents with budgetary responsibilities who carry out the role of controller, controlling manager, or controlling coordinator in Brazilian companies. The results show that budgetary participation positively influences vertical information sharing, which presented a positive influence on managerial performance. Vertical information sharing results from cognitive effects of budgetary participation. Higher levels of vertical information sharing are reflected in lower role ambiguity and better managerial performance. Even if individuals with budgetary responsibilities perceive the existence of information asymmetry in the work environment, its effects on performance are not significant. These results contribute to understanding the mediating cognitive effects of information sharing on the relationship between participation and performance, revealing that the effects of participation on performance may not occur based on a simple causality relationship, but instead based on certain conditioning factors.
Highlights
Micheli Aparecida Lunardi, Vinícius Costa da Silva Zonatto & Juliana Constâncio NascimentoThe management control procedures often used in organizations involve the participation of managers and their subordinates (Baiman & Evans, 1983; 2002; Silva & Gomes, 2011)
The relationship between managerial performance ← role ambiguity was significant, at the 0.05 level. These results reveal that, for these cases, the t-values were higher than the values recommended by Hair et al (2009), which indicates the existence of statistically significant relationships between the constructs, which did not occur in the other relationships investigated
This study analyzed the cognitive effects of vertical information sharing in the budgeting process on the relationship between budgetary participation and managerial performance
Summary
Micheli Aparecida Lunardi, Vinícius Costa da Silva Zonatto & Juliana Constâncio Nascimento. The evidence found for the relationship between budgetary participation and managerial performance has presented various results that indicate a direct (Kyj & Parker, 2008; Parker & Kyj, 2006; Zonatto et al, 2019) or indirect relationship between these variables, measured by other intervening variables (Baldvinsdottir, Mitchell & Norreklit, 2010; Dani et al, 2017; Derfuss, 2016), such as motivation (Chong et al, 2005; Karakoc & Ozer, 2016; Mia, 1988), satisfaction (Kyj & Parker, 2008), and organizational commitment (Chong & Johnson, 2007; Parker & Kyj, 2006). The results of this study support the evidence that budgetary participation directly and indirectly influences managerial performance These conditions have favored information sharing, reducing role ambiguity and information asymmetry and improving managerial performance. The findings of this study serve as a parameter for other organizations that have not been studied so that they can evaluate the adoption of budget management practices that contribute to minimizing the negative effects of information asymmetry and role ambiguity, with a view to obtaining better performance
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