Proceedings of the 2nd International Conference of Business, Accounting and Economics, ICBAE 2020, 5 - 6 August 2020, Purwokerto, Indonesia

Research Article

Budgeting Slack, Social Pressure, and Autonomous Behavior in Experiment Relationship

Download387 downloads
  • @INPROCEEDINGS{10.4108/eai.5-8-2020.2301229,
        author={Annisa Ilma Hartikasari and Ira  Hapsari},
        title={Budgeting Slack, Social Pressure, and Autonomous Behavior in Experiment Relationship },
        proceedings={Proceedings of the 2nd International Conference of Business, Accounting and Economics, ICBAE 2020,  5 - 6 August 2020, Purwokerto, Indonesia},
        publisher={EAI},
        proceedings_a={ICBAE},
        year={2020},
        month={10},
        keywords={budgetary slack social pressure organizational justice distributive justice procedural justice autonomous motivation},
        doi={10.4108/eai.5-8-2020.2301229}
    }
    
  • Annisa Ilma Hartikasari
    Ira Hapsari
    Year: 2020
    Budgeting Slack, Social Pressure, and Autonomous Behavior in Experiment Relationship
    ICBAE
    EAI
    DOI: 10.4108/eai.5-8-2020.2301229
Annisa Ilma Hartikasari1,*, Ira Hapsari1
  • 1: Faculty of Economics and Business, Universitas Muhammadiyah Purwokerto
*Contact email: aihartikasari@gmail.com

Abstract

The purpose of this study is to examine the effect of improper social pressure on business unit controller’s inclination to create budgetary slack in the setting of organizational justice in the form of distributive and procedural justice. The creation of budgetary slack in this study is related to produce lower ROI target compared with actual ROI target that can be achieved by business unit. Furthermore, this study also examines the impact of Autonomous Motivation on the causality of social pressure, organizational justice, and the creation of budgetary slack. The experimental method is used in this study with 2x2 between subject design factorial. The participants were 152 postgraduate accounting and management students from two large private universities in Indonesia. First, controller business unit under high social pressure have a greater tendency to create budgetary slack. Second, procedural justice is more effective than distributive justice at reducing budgetary slack creation by controller business unit. Third, controller under conditions of low social pressure and distributive justice will still tend to create budgetary slack and on the contrary, procedural justice will decrease the tendency of budgetary slack creation even though there is a high social pressure. Fourth, after controlling Autonomous Motivation, there is still interaction effect between social pressure and organizational justice on the creation of budgetary slack by controller business unit.