The joint effect of budgetary participation and broad-scope management accounting systems on management performance

Purpose – The purpose of this paper is to examine the interaction effect of budgetary participation (BP) and broad-scope management accounting systems (BMAS) on management performance (MP). Design/methodology/approach – A survey questionnaire was administered to managers of listed electronics companies in Taiwan. A moderated multiple regression model containing a product term was used to examine the interaction effect among BMAS, BP, and MP. Findings – The results show the presence of a non-monotonic interaction relationship between BP and MP over the range of the extent of BMAS. These findings support the hypothesis that a high (low) perceived usefulness of BMAS information is correlated with MP in situations of high (low) BP. Originality/value – The paper provides additional empirical evidence to make clear the nature of the interaction between BP and BMAS impacting MP. The empirical evidence presented in the paper reveals that BMAS plays an essential mediating role in the relationship between BP and MP. Firms implementing a BP system should pay particular attention to the fit collocation of both BMAS and BP.