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Budget participation and informational asymmetry: a study in a multinational company

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Abstract

The objective of this study is to verify the influence of budgetary participation on the reduction of information asymmetry in the budget process in a multinational company, having taken for granted that the participatory budget minimizes information asymmetry. Therefore, descriptive research was carried out, in the form of a case study and qualitative type, through interviews and direct observation. The study was applied in a business unit of a multinational company that has the consolidated budget practice. The results of the research show that the company has a participatory budget, for all sectors and managers are directly involved in its preparation. Moreover, several meetings are held to discuss and define the budget targets. However, in this study this condition did not minimize information asymmetry, as most responses focused on a single item, indicating that the sub-manager/subordinate has more information than his superior.

Keyword : Budgetary participation, informational asymmetry, agency theory

How to Cite
Lavarda, C. E., & Almeida, D. (2013). Budget participation and informational asymmetry: a study in a multinational company. Brazilian Business Review, 10(2), 72-94. https://doi.org/10.15728/bbr.2013.10.2.4
  Submitted
Jun 9, 2018
Published
Apr 1, 2013
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