Environmental Uncertainty, Budgetary Slack And Enterprise Value

As the Ministry of Finance issued "guidance on promoting the construction of the comprehensive management accounting system(Draft)" in 2010,the development of management accounting in China becoming more and more standardized and scientific.In the management accounting system,Budget management is an effective management tool that can coordinate the external environment and the internal conditions of the enterprise.It can help to clarify the management process and enhance the ability of risk management and control.The topic of concern about the efficiency of budget management will continue as people focus on internal control and management control.Budget has become an important means of modern enterprise internal management and control,the importance of budget management has been widely concerned,but in the use of budget means there is a budgetary slack.The research findings by scholars had shown that principal agency theory and contingency theory all can well explain the reason of budgetary slack.From the perspective of principal agency theory,the budgetary slack is damage to enterprise performance.And from the perspective of contingency theory,the purpose of managers to create budgetary slack is in response to the existence of environment uncertainty,and budgetary slack is conducive to business performance.However,form the existing empirical results of the investigation,whether at home or abroad,the study of this issue are not clear and consistent conclusions.And this has caused problems to decrease the behavior of creating budgetary slack.Many studies support the interpretation of slack from perspective of agency theory and contingency theory.However,the studies of using the Chinese Listed Companies data to verify the applicability of the two theories to China's market is less.In fact,the result of budgetary slack have an affect on the enterprise is multiple,including business efficiency,resource allocation,human culture,corporate stability,etc..Therefore,it is necessary to study the influence of budgetary slack on the enterprise value.In this paper,in-depth study of the results of previous studies both at home and abroad and on the basis of publicly listed data of Chinese market,we want to known which theory is more proper to Chinese market,and also research the relationship between slack and enterprisevalue.We will take environmental uncertainty into consideration,researching the relationship between budgetary slack and enterprise value from the contingency theory.This article selects A shares companies of China which disclose budgetary data as research samples to research the influence of budgetary slack on enterprise value,there are1913 sample firms data from 2013 to 2015.And add the environmental uncertainty variable to verify the relationship between budgetary slack and enterprise value,this is from the perspective of contingency theory.Then provide practical ideas to solve the problem of budgetary slack for Chinese listed Companies.According to the empirical test,this paper found that:1.Under certain conditions,the budgetary slack is negatively related to the firm value.The higher the budgetary slack is,the lower the firm value is.2.Under certain conditions,A higher environmental uncertainty weakens the relationship between the budgetary slack and enterprise value.In other words,in the case of high environmental uncertainty,contingency theory can explain budgetary slack to some extent.It was found that the budgetary slack can be self serving behavior management,it is also likely to respond to environmental uncertainty.Management of budgetary slack can not simply take the "strike" method,when environmental uncertainty is high,the enterprise should chooses the goal of maximizing the value as reasonable strategic choice,in order to effectively deal with the impact of environmental uncertainty.