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Article Details

Vol. 1 No. 1 (2020): November

The Effect of Budgetary Participation on Managerial Performance: Internal Control and Organizational Commitments as Intervening Variables

https://doi.org/10.35912/jshe.v1i1.131
24 Nov 2020

Abstract

Purpose: This study aims to examine the effect of budgetary participation on managerial performance with internal control and organizational commitment as an intervening variable, in a state-owned plantation company, namely PT Perkebunan Nusantara (PTPN) VII.

Methodology: Using a questionnaire survey study for 100 respondents involved in the budgeting process at PT Perkebunan Nusantara VII, this study analyzed the data using SEM PLS, SmartPLS 3.2 software.

Results: The results show that budgetary participation has a positive effect on managerial performance directly. Meanwhile, internal control is an intervening variable into the  relationship between budgeting participation and managerial performance. On the contrary, organizational commitment is not proven as an intervening variable into the relationship between budgeting participation and managerial performance.

Conclusions: Budgeting participation positively impacts managerial performance directly and via internal control, while organizational commitment has no mediating effect. PTPN VII shows revenue and profit growth, reflecting effective internal controls and managerial practices.

Limitations: This study contributes to the management accounting literature and provides an overview of the effectiveness of regulations, policies and work programs that have been made by companies in improving managerial performance, particularly those relating to budgeting, internal control, and organizational commitment.

Contributions: The study attempts to offer new insights on the influence of budgeting participation, internal control and organizational commitment, and other variables in improving managerial performance in state-owned plantation companies.

Keywords

Budgeting Participation Internal Control Managerial Performance Organizational Commitment

How to Cite

Sastrawan, H., Dewi, F. G., & Yuliansyah, Y. (2020). The Effect of Budgetary Participation on Managerial Performance: Internal Control and Organizational Commitments as Intervening Variables. Journal of Social, Humanity, and Education, 1(1), 39–51. https://doi.org/10.35912/jshe.v1i1.131

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Authors

1 . Hendrik Sastrawan
Faculty of Economics and Business, University of Lampung, Bandar Lampung, Indonesia
2 . Fajar Gustiawaty Dewi
Faculty of Economics and Business, University of Lampung, Bandar Lampung, Indonesia
3 . Yuliansyah Yuliansyah
Faculty of Economics and Business, University of Lampung, Bandar Lampung, Indonesia

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Vol. 1 No. 1 (2020): November
Section: Articles
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