The Effect of Cost Management Knowledge on the Relationship Between Budget Participation and Managerial Performance: Budget Adequacy as a Mediating Variable

Abstract

Managerial performance is the result of a process of effective managerial activities from planning, implementation, administration, reporting, accountability, guidance and supervision. Less attention has been paid by previousresearchers, especially using public sector organization.This research try to investigatethe effect of cost management knowledge on the relationship between budgetparticipation and managerial performance. Beside, this study also determine whether budget adequacy play as a mediating variable. This study use the goal setting theory andcontingency theory. Goal seeting approach focuses the relationship between the design of management control of the motivational variables such as motivation, organizational commitment, performance and job satisfaction. The object of study is lower manager in local government in Pesisir Selatan district. 130 questioneers were distributed to the respondends and only 63 returned the complete questioners. To see the role cost management knowledge as moderating variable, we use the moderate regression analysis. Meanwhile, hyrarichal regression analysis is applied to see the role of mediating variable. Other use the simple and multiple regression analysis. The result show that budget participation has a significant relationship with managerial performance. In addition, knowledge management and budget adequacy are sucess as moderating and mediating variabels. This study enrich the goal setting and contigency theory in the sense that these theories are also apllied in public sector organization.

Keywords: Budget Participation, Budget Adequacy,
 Managerial Performance, Management Knowledge