Budget Communication:Drivers,Ways And Effectiveness

As companies face increasingly complex economic environment,good internal control is more important for the stable development of enterprises.Budget as an important part of internal control.So,more and more enterprises adopt a variety of measures in favor of the implementation of the budget,the purpose is to ensure that enterprises get a good budget results.Especially in the corporate agency relationship,due to asymmetric information have a lot of problems that influencing budgetary effects,therefore,it needs companies seriously face.Information communication is an important method of solving the asymmetric information,therefore,in the enterprise budget management,the good budget communication could solve this problem.In the information communication,budget communication not only affects the effect of the budget,while the budget communication is with other factors,this is a system relations.In this article,the budget meeting communication institutionalization and budget management information could interpret communication systems and communication tools,and budget assessment,the budget staff expertise and budget culture are important factors affecting the budget communication.Therefore,Article aims to build the theoretical model and make quantitative verification.Budget communication is an important means of reducing budget management information asymmetry and improving budget management implementation effect.Cooperating with consulting firm,we carried out depth survey by providing free consulting service for its Chinese clients,then collected data.We found that the institutionalization of budget meeting and informatization of budget management system can significantly enhance the budget effectiveness.When companies have relatively strong budget culture,competitive budget staffs and taking the budget results as the most important predictor in performance evaluation,the institutionalization of budget meeting is more easy to set up.And the corporate budget culture can also improve the enthusiasm of computerizing their budget management information system.It indicates that the management should pay more attention to the budget process and technical methods,as well as the influence of communication,culture,personnel and other factors in the budget managementThe main innovation of this paper are:first,firstly using the basic principles of agency theory construction budget communication and budget effect and using of Chinese enterprises actual data to verify the impact of budget meeting communication institutionalization and budget management informatization on the budget effect,to explain the relationship between budget communication and budget effectiveness,as well as the important factor affecting the budget meeting communication systems and budgetary platform.It provides new research and empirical evidence for the theory of budget management.Second,it confirmed the communication theory of "wheel structure" in psychology,principal-agent theory of economics and other classical theory effectiveness in budget management;It also confirmed the direct and indirect influence between budget assessment and budget effect.The main structure of the article include six parts:The first part is the introduction that clarifying the purpose,significance and research methods;The second part is the literature review,mainly to sort out related research on the budget communication,the effect of the budget and the relationship between budget communication and budget effect;The third part discusses the theoretical analysis and hypotheses based on agency theory;The fourth part is the research design,including sample selection,data acquisition and variable design;The fifth part is empirical analysis,including the results analysis of structural equation and robustness tests;The sixth part is conclusion and suggestions.