Budgeting practice in Singapore - an exploratory study using a survey / Tan Boon Seng and Low Kin Yew

Tan, Boon Seng and Low, Kin Yew (2017) Budgeting practice in Singapore - an exploratory study using a survey / Tan Boon Seng and Low Kin Yew. Asia-Pacific Management Accounting Journal (APMAJ), 12 (1). pp. 77-103. ISSN 2550-1631


This study is conducted to better understand budgeting practice in Singapore which may be critical for increasing competitiveness and productivity for firms, and increasing value-add contribution for accountants. We obtained 356 valid responses from an online survey administered to members of a professional accounting organization. We found that most firms prepare budget and many (about 30%) incorporate significant strategy assumptions in budgets. The time spend on budgeting (10%-20%) is lower than what was reported in US studies, and more time is spent in preparing than using the budget. Budgeting problems (e.g. ratcheting and sandbagging behaviour) are well recognized, but firms preparing budgets with business plans generally deem pros for budgeting exceeding cons. Firms with annual revenue below $1m prepare budget primarily for forecasting cash flows; larger firms focus more on guiding and coordinating business activities, with increasing importance on variance analysis as firm size increases. For firms that prepare budgets with business plans, employee compensation based on budget performance is not as prevalent as expected. About 70% of the firms set budget targets to monitor strategy execution, about 50% set budget target for employee performance evaluation, and about 43% compensate by budget performance. The implications of these findings are discussed.


Item Type: Article
Email / ID Num.
Tan, Boon Seng
Low, Kin Yew
Subjects: H Social Sciences > HD Industries. Land use. Labor > Management. Industrial Management > Organizational change. Organizational development. Corporate turnarounds
H Social Sciences > HF Commerce > Success in business. Performance
Divisions: Universiti Teknologi MARA, Shah Alam > Accounting Research Institute (ARI)
Journal or Publication Title: Asia-Pacific Management Accounting Journal (APMAJ)
UiTM Journal Collections: UiTM Journal > Asia-Pacific Management Accounting Journal (APMAJ)
ISSN: 2550-1631
Volume: 12
Number: 1
Page Range: pp. 77-103
Keywords: Budgeting process, Budget gaming, Strategic control
Date: June 2017
URI: https://ir.uitm.edu.my/id/eprint/29937
Edit Item
Edit Item


[thumbnail of 29937.pdf] Text

Download (1MB)

ID Number




Statistic details