Research On Budget Slack Problem And Relevant Solutions Of H Theatric Company

Budget management, since been brought out in the 1920 s, has been favored by a large amount of scholars. Under their great efforts in researching and popularizing, budget management has gained more rapid promotion and wider application in the next few decades. During these decades, budget management has developed from the initial planning, arranging and coordinating production tool into an approach of integrated management consisting of control, evaluation and stimulation functions. However, the practices of budget management are not as easy as it appears to be, there exist lots of problems in its concrete application measures, for example, in some companies there exist serious problems o f the budgetary slack. According to studies, budgetary slack can lead to the inflated costs of resources, the inefficiencies of business management, and the failure of performance estimations and so forth. As soon as the concept of budgetary slack was raised, it has drawn a great and wide attention among the academicians. Due to its short story, no conclusion has been drawn so far among domestic and foreign scholars about plenty of hotpot issues.In order to clarify the cause of budgetary slack, in this the sis, a large number of previous research results have been collected, collated and analyzed, and the author tried to explain the phenomenon of budgetary slack from four theoretical perspectives including Behavioral Science Theory and Contingency Theory. A model on the formation mechanism of budgetary slack was built on the support of four economical theories. This model explains that the fundamental reason of budgetary slack is people’s initiative, while the richly varied external environment provides the objective conditions. The transformation into budgetary slack behavior from budgetary slack motivation depends critically on the rivalry between budget supervisors and executors. At the same time, the turbulence of external environment and the information asymmetry between superiors and subordinates have indirect impact on the results of this rivalry. In the last part of this thesis, that is the part of case study, following the pattern of identifying problems, analyzing the causes and coming up with the sol utions, the author conducted a comprehensive analysis and control of the budgetary slack existing in H Theatre, aimed at improve the budget management abilities and eliminate the adverse effects caused by budgetary slack.