The moderating effect of environmental uncertainty on the relationship between budgetary participation and budget quality

Abstract

Purpose

This study aims to investigate the influence of budgetary participation on budget quality on top of the moderating role of environmental uncertainty on the said relationship.

Design/methodology/approach

The objectives of the current study were achieved through a survey conducted in 15 Iraqi states. Each state contains several municipalities. In total, 180 survey forms were disseminated to the heads of the municipalities, where ultimately 155 questionnaires proceeded to the data analysis stage. In this stage, statistical package for social sciences, analysis of moment structure and structural equation modelling were used to solve the research problem and achieve the objectives.

Findings

Through the results of the statistical analysis, this study concluded the significant and positive effect of budgetary participation on budget quality. In addition, the study confirmed the moderating role of environmental uncertainty in weakening the positive relationship between budgetary participation and budget quality.

Originality/value

The findings can be used to encourage municipal institutions and local governments to expand on the factor of employee participation in affecting the process of budget determination, hence mitigating budget failure.

Citation

Hassan, A.F. and Basiruddin, R. (2023), "The moderating effect of environmental uncertainty on the relationship between budgetary participation and budget quality", Journal of Financial Reporting and Accounting, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JFRA-03-2023-0162