Unraveling the Determinants of Budgetary Slack: A Study of Participation, Information Asymmetry, and Organizational Factors

Aim: Budgeting is not just a financial plan to monitor expenses and revenues over time within an organization; it also serves as an essential management tool for executing the company’s strategic goals. In the context of achieving budget targets, a "changan budget" often entails forecasting higher expenses and lower revenues within a specified range. This study seeks to examine how factors such as budget participation, information asymmetry, self-interest, role ambiguity, and organizational commitment affect budgetary slack at Village Credit Institutions (LPD) in Denpasar City.Methodology: Using purposive sampling, responses were collected from 136 participants, and data analysis was conducted using multiple linear regression.Findings: The findings indicate that budget participation, information asymmetry, self-interest, role ambiguity, and organizational commitment all positively influence budgetary slack in LPDs in Denpasar City.Implications/Novel Contribution: To improve the prediction of factors affecting budgetary slack, future studies should consider including additional variables, such as leadership style and internal control systems.