Year: 2015
Type: article
Abstract: This study examines the evolution of budgeting practices in the extremely difficult Spanish economic environment. In order to analyse if companies are still maintaining their budgeting process and if, right now, they are facing more difficulties in forecasting accurate indicators, two similar web surveys were addressed over two periods of time, firstly in 2008 at the beginning of the financial crisis, and secondly in 2013 after five years of a downward trend. In addition, in-depth interviews were conducted to investigate how companies brought more flexibility to their budgeting process in order to cope with environmental uncertainty. The survey indicates that 97% of respondents are still using a traditional budgeting process being this result similar to the one found in 2008. However, 2013 showed that the reliance on forecasted information is being increasingly questioned. Furthermore the study revealed that the respondents are bringing more flexibility to their processes, being able to modify the objectives once the budget is approved and to obtain new resources outside the budgeting process. This paper contributes to revealing information about difficulties in setting reliable objectives in a turbulent environment and provides data about the evolution of budgeting practices over five years during an austere economic crisis.
Source: Cuadernos de Gestión
DOI: 10.5295/cdg.140480ag
Authors: ESCP Europe, Campus Madrid, C/ Arroyofresno 1, 28035 Madrid (España). [email protected], Marie Anne Lorain, Aurora García Domonte, Departamento de Gestión Financiera, Universidad Pontificia Comillas – ICADE, C/ Alberto Aguilera 23, 28015 Madrid (España). [email protected], Francisco Sastre Peláez, Departamento de Gestión Financiera, Universidad Pontificia Comillas – ICADE, C/ Alberto Aguilera 23, 28015 Madrid (España). [email protected]
Institutions: ESCP Business School, Universidad Pontificia Comillas
Language: English
Subfield: Management Information Systems
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W2178593235