Influence of budget participation on budget quality, budget adequacy, and budget goal level of managers with budgetary responsibility in port companies

Purpose: The present study aimed to analyze the influence of budget participation on budget quality, budget adequacy, and budget goal level of managers with budgetary responsibility in port companies. Methodology: A methodological approach based on a survey with 101 managers responsible for planning and budget control of port companies in Brazil was used, and structural equation modeling analysis with partial least squares (PLS-SEM) to test the hypotheses. Results: The results suggest that participation in the budget process exerts a positive and significant influence on both budget quality and adequacy, as well as on budget goal levels. However, although budget quality did not show a significant association with the budget goal level, budget adequacy in terms of the ability to deliver what is expected to emerge as a relevant predictor for achieving these goals. Contributions of the Study: This study contributes to the literature by presenting new evidence regarding individual participation in the budgeting process and offering insights into the application of Goal Setting Theory. The findings emphasize the importance of managers' participation in budgeting, which directly influences budget quality and adequacy. This engagement significantly affects the achievement of budget goals, providing vital information that enables managers and superiors to make more assertive decisions. Therefore, the research suggests that active participation by managers in the budgeting process is essential for successfully meeting organizational objectives and goals.