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Determinants of employees’ psychological ownership on budgetary slack

Author

Listed:
  • Cheok Mui Yee

    (Faculty of Business and Accountancy, University of Malaya, Malaysia)

  • Edward Wong Sek Khin

    (Faculty of Business and Accountancy, University of Malaya, Malaysia)

  • Kamisah Ismail

    (Faculty of Business and Accountancy)

Abstract

The existence of budgetary slack permeates every level of private sector organisations. Employees (i.e., budget makers) usually request excessive budgetary resources in the budgeting process. Due to its dysfunctional nature, existing researchers had extensively examined the relationship between budgetary slack and employees’ performance. This study adopted a survey questionnaire approach to examine the relationship between determinants of psychological ownership and employees’ intention to create slack in budgeting. There were 475 budget makers from private sector organisations in the Klang Valley, Malaysia who participated in this study through a questionnaire survey. Preliminary data analysis was performed using normality, multi-collinearity, variance inflation index (VIF), common method variance, and reliability analysis. Multiple regression analysis was also applied to investigate the relationships of each dimension of employees’ psychological ownership on budgetary slack. This paper is considered a pioneer empirical study that investigates the determinants of psychological ownership on budgetary slack among budget makers from the psychological perspective in the context of private sector organisations in Malaysia, where slack activities in budgeting existed.

Suggested Citation

  • Cheok Mui Yee & Edward Wong Sek Khin & Kamisah Ismail, 2018. "Determinants of employees’ psychological ownership on budgetary slack," The Audit Financiar journal, Chamber of Financial Auditors of Romania, vol. 16(149), pages 122-122, February.
    • Handle: RePEc:aud:audfin:v:16:y:2018:i:149:p:122
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    References listed on IDEAS

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    1. Rahimah Mohamed Yunos & Zubaidah Ismail & Malcolm Smith, 2012. "Ethnicity and accounting conservatism: Malaysian evidence," Asian Review of Accounting, Emerald Group Publishing Limited, vol. 20(1), pages 34-57, May.
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    3. Williams, John J. & Macintosh, Norman B. & Moore, John C., 1990. "Budget-related behavior in public sector organizations: Some empirical evidence," Accounting, Organizations and Society, Elsevier, vol. 15(3), pages 221-246.
    4. Lukka, Kari, 1988. "Budgetary biasing in organizations: Theoretical framework and empirical evidence," Accounting, Organizations and Society, Elsevier, vol. 13(3), pages 281-301, April.
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    More about this item

    Keywords

    Budgetary slack; psychological ownership; private sector organisations;
    All these keywords.

    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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