Academy of Accounting and Financial Studies Journal (Print ISSN: 1096-3685; Online ISSN: 1528-2635)


The Role of Risk Management on Budget Quality and Slack

Author(s): Robinson, Anis Chariri, Tri Jatmiko Wahyu Prabowo

There are two purposes of this study, first, to examine some effects of budget qualities of goal clarity, evaluation and accuracy on budget slack. Second, this research was tested effect of risk management as moderating variable on relation between budget qualities and slack of budget. In practice, the results of this study contribute for local parliamentarian and local government when they prepare the budget. By purposive sampling method, this study used 89 data that being collected from members of budget committee. The statistical analysis based on linier regression to test first hypothesis and interaction analysis or Moderated Regression Analysis (MRA) was used for second hypothesis analysis. The results show that goal clarity, evaluation, and accuracy tend to have negative effects on budget slack. The interaction analysis result show effect of risk management on relation between budget quality and slack of budget were found to be weak or insignificant. Risk management, furthermore, were found to have negative influence on budget slack.