Effectiveness of Management Control Systems on Budget Realization in A Government Organization Based on Levers-of-Control Theory: A Case Study at The Indonesian Agency for Research And Development of Energy and Mineral Resources

DOI

10.2991/apbec-18.2019.68How to use a DOI?

Keywords

management control system, budget realization performance, levers of control

Abstract

The purposes of this research are to analyze the effectiveness of the implementation of an upstream/downstream control system applied to research units and to overcome the problems faced by the delay and the low achievement of expenditure realization occurring in prior years. The study uses qualitative methodologies, leveraging questionnaire survey data from 121 budget managers from the highest to the operational-manager levels. Furthermore, our triangulation technique is deepened with interviews, secondary document analysis, and a literature review. Effectiveness analysis of control systems is achieved by referring to the levers-of-control (LoC) theory framework. The analysis of managerial accounting information quality uses characteristic dimensions developed by Chenhall and Morris. We obtain evidence that the implementation of an upstream/downstream control system can change the pattern of budget realization achievement in all work units. The applied control system incorporates four elements from the LoC. Notably, the diagnostic system and interactive controls can effectively improve the performance of budget realization. As perceived by budget managers, the information generated via the diagnostic control systems can provide quality information that encourages interactive systems to function better. Interaction between elements in this system can further boost organizational performance. This research shows that the implementation of a management control system applied to a research unit can solve the problem of delays and low achievement of budget realization performance. Thus, it can be used as reference for other government organizations in Indonesia.

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Hartanto Adhi Nugroho
AU  - Dwi Hartanti
PY  - 2019/07
DA  - 2019/07
TI  - Effectiveness of Management Control Systems on Budget Realization in A Government Organization Based on Levers-of-Control Theory: A Case Study at The Indonesian Agency for Research And Development of Energy and Mineral Resources
BT  - Proceedings of the Asia Pacific Business and Economics Conference (APBEC 2018)
PB  - Atlantis Press
SP  - 485
EP  - 492
SN  - 2352-5428
UR  - https://doi.org/10.2991/apbec-18.2019.68
DO  - 10.2991/apbec-18.2019.68
ID  - AdhiNugroho2019/07
ER  -