This study aims to examine the mediating role of organisational fairness on the association between the emphasis on budgets and budget difficulty with budget value and job stress. Data were collected using an online survey questionnaire with 515 responses from middle and lower-level managers in Australian business organisations. The results indicate that organisational fairness fully mediates the association between budget difficulty with both budget value and job stress. Organisational fairness was not found to mediate the association between the emphasis on budgets with budget value and job stress. Rather, the emphasis on budgets was significantly negatively associated with job stress, implying that a greater emphasis on budgets is desirable in alleviating job stress. The findings have important implications for practice.
Su, S. and Baird, K. (2023), "The Impact of the Emphasis on Budgets and Budget Difficulty on Budget Value and Job Stress: The Mediating Role of Organisational Fairness", Akroyd, C. (Ed.) Advances in Management Accounting (Advances in Management Accounting, Vol. 34), Emerald Publishing Limited, Leeds, pp. 145-175. https://doi.org/10.1108/S1474-787120220000034006
Specifically, higher (lower) organisational fairness will result in higher (lower) budget value and lower (higher) job stress
job stress
Occupational stress is psychological stress related to one's job. Occupational stress refers to a chronic condition. Occupational stress can be managed by understanding what the stressful conditions at work are and taking steps to remediate those conditions.
https://en.wikipedia.org › wiki › Occupational_stress
. Accordingly, we hypothesise that organisational fairness will mediate the association between the emphasis on budgets and budget difficulty with budget value and job stress.
Concerning how budgets are linked to performance, budgets and budgetary controls mainly form and give every organization the structural support to achieve its goals and objectives, and maximizing performance, through resource allocation and control.
Organisations implementing effective budgetary control systems can better manage their finances, reduce costs, and increase efficiency. One of the primary benefits of budgetary control is improved financial performance.
For one thing, budgeting helps formulate the company's activities, allowing it to better understand priorities, figure out how resources can be allocated, and which areas need to be reevaluated. Another factor that's part of the importance of the planning process is the ability to set realistic goals.
Accountability and Responsibility: Budget analysis and controls create a sense of accountability among employees. When they are assigned budgetary targets, they feel responsible for meeting those goals. This accountability can lead to more responsible decision-making and greater ownership of their tasks and projects.
In summary, budgeting is critical to business success. It helps businesses track cash flow, plan for growth, prepare for emergencies, identify inefficiencies, and make informed business decisions. A good budget requires careful planning, goal-setting, and financial analysis.
Performance budgets reflect the input of resources and the output of services for each department or unit of an organization. They are designed to motivate employees' commitment to produce positive results.
a budget could be inflexible, and not allow for unexpected circ*mstances. creating and monitoring a budget can be time consuming. budgeting could create competition and conflict between teams or departments. if targets are unrealistic, employees could become stressed and under pressure.
Allocate Resources: Budgeting enables organizations to allocate resources efficiently and effectively. By identifying the resources required to achieve the objectives, organizations can allocate their resources in a way that maximizes their impact.
Having a clear, agreed budget gives you a structured framework for your financial decision-making. It's a practical way to control your costs, monitor performance and adapt your strategic and financial decisions to meet changing economic conditions.
Budgeting can be a source of stress and anxiety for many people, especially when they face unexpected expenses, income fluctuations, or debt. However, living within your means does not have to mean sacrificing your happiness.
Research suggests that budgeting behavior is an important aspect of consumer finance and is considered a desirable financial behavior. It is also influenced by behavioral aspects such as attitudes, motivation, and participation in the budgeting process .
Budgets can be used to motivate because participants will internalize the budget goals as their own since they participated in their development. Information should be interchanged among budget participants. An imposed budget will have a negative effect on motivation.
Forces management to look ahead, to set out detailed plans for achieving the targets for each department, operation and (ideally) each manager, to anticipate and give the organisation purpose and direction. Promotes coordination and communication.
Budget controls are necessary to ensure that a government does not spend more than the amount legally appropriated by its governing body. By establishing clear spending boundaries, budget controls also promote accountability and bolster trust throughout the organization.
The effects of the budget constraint are evident in the fact that consumers can't just buy everything they want and are induced into making choices, according to their preferences, between the alternatives.
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