Budgeting in the Public Sector in LDCS Some Research Findings

1
Budgeting in the Public Sector in LDCS Some
Research Findings

• Some of the major findings of Ouibrahim and
  Scapens (1989) Jones and Sefiane (1992)s works
  are following
• accounting was significant in day-to-day
  activities of the enterprises but it was in the
  form of production figures.
• Other than the financial officers at the head
  office, most of the participants had a little
  knowledge of accounting.
• Language of accounting was not used as a means
  of communication between managers but it was the
  language of production (in the construction
  industry) that had been helpful for managers in
  their day-to-day activities.
• Accounting information was marginal to
  bureaucratic decisions. It was there only to help
  calculate subsidies.
• Enterprises are production driven due to
  governmental pressures for completing projects,
  shortage of material supply and production
  capacity, state control over all costs and prices
  
• Managerial bonuses were based on achieving
  planned output levels rather than financial
  targets such as profit

2
Budgeting in the Public Sector in LDCS Some
Research Findings

• Hoque (1995) and Hoque and Hopper (1994)
  indicated that the following
• State mill managers perceived little
  participation from the mill management in
  budgeting process
• HO managers have greater influence in this
  respect by participation in the process
• From mills perspective, budgets are enforcement
  of the HO and the state
• Mill managers perceive that budgets are less
  important in day-to-day management control of the
  mill.
• In general, mill managers were highly
  dissatisfied with the budgets and their aspects
  such as timing, flexibility, participation,
  motivation, and adequacy

3
Budgeting in the Public Sector in LDCS Some
Research Findings

• Hoque and Hopper (1997) reported the following
• A set of environmental factors (political
  climate, industrial relations, competition, aid
  agencies, and government regulation) affect
  budget-related factors (participation,
  accountability for budgets, budget evaluation,
  budget analysis, interaction among managers and
  budget flexibility).
• It was found that there were significant
  associations between managers budget-related
  behaviour and environmental factors.
• It is pertinent to contingency theory in several
  respects. By generating variables from the
  fields, it has drawn attention to the importance
  of previously neglected institutional factors
  such as political and industrial relations.

4
Budgeting in the Public Sector in LDCS Some
Research Findings

• Alam (1997) reported on budgetary process in
  uncertain contexts
• It investigates how budgeting is used to manage
  technical and institutional environments.
• The paper emphasises on how management practices
  and actions attempt to mediate and moderate the
  relationship between key elements of the external
  environment and the internal functioning of the
  organisation.