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PUBLIC BUDGET RATCHETING: DO MALAYSIA FEDERAL GOVERNMENT AGENCIES ADJUST THEIR BUDGETS BASED ON EXPENDITURE VARIANCES?

UNIMAS Review of Accounting and Finance

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Title PUBLIC BUDGET RATCHETING: DO MALAYSIA FEDERAL GOVERNMENT AGENCIES ADJUST THEIR BUDGETS BASED ON EXPENDITURE VARIANCES?
 
Creator Hla, Daw Tin
Ping, Chang Sze
Md.Isa, Abu Hassan
Tinggi, Micheal
Japar, Shaharudin
 
Description Public budget is an important role in achieving a country’s economic and social development goals. It essentially requires that an entire government budget be managed effectively and efficiently to ensure attainment of those goals as well as well-being of the citizens. Therefore, it is necessary to examine government spending behaviour and the process of budget preparation. This study looks into the relationship between changes in current budget and expenditure variances, in particular, operating expenditure of the Malaysia federal government. The influence of expenditure variances (overspending/ under spending) on current budget changes is examined to determine if prior year expenditure variances cause non-symmetry changes in current budget so as to identify the presence of budget ratcheting. Dynamic Panel Regression Analysis is used to examine the data from forty four government agencies/programs, covering the period from 2010 until 2014. The findings reveal that there is a significant positive association between changes in current budget with prior year overspending by agency/program. However, the relationship between changes in current budget with prior year underspending by agency/program is not significant. The contribution of the research highlights that the presence of budget ratcheting among the federal government agencies/programs of public organisations needs to be indicated to enhance budget administration regarding ratcheting.
 
Publisher Universiti Malaysia Sarawak
 
Date 2016-08-01
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Auto Correlation and Panel Regression
 
Format application/pdf
 
Identifier http://publisher.unimas.my/ojs/index.php/URAF/article/view/289
 
Source UNIMAS Review of Accounting and Finance; Vol 1 No 1 (2016): Special Issue Cociaf 2015
 
Language eng
 
Relation http://publisher.unimas.my/ojs/index.php/URAF/article/view/289/pdf9
 
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