Articles

Budgeting in times of economic crisis

S. BECKER, M. MAHLENDORF, U. SCHÄFFER, M. THATEN

Contemporary Accounting Research

Winter 2016, vol. 33, n°4, pp.1489–1517

Departments: Accounting & Management Control, GREGHEC (CNRS)

Keywords: Budgeting, budgeting functions, economic crisis, crisis management

http://ssrn.com/abstract=2605359


This paper examines how corporate reliance on budgets is affected by major changes in the economic environment. We combine survey and archival data from the economic crisis that began in 2008. The results indicate that, as a result of the economic crisis, budgeting became more important for planning and resource allocation but less important for performance evaluation. Additional evidence from interviews and data gathered in a focus group further illustrate these results and show the changes organizations have introduced to respond to the economic crisis. Taken together, and contrary to more general conclusions from the literature such as an overall increase or decrease in the importance of budgeting, we find that companies emphasize certain budgeting functions over others during economic crises


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