Does National Culture Impact Capital Budgeting Systems?

    Research output: Contribution to journalArticle

    4 Citations (Scopus)

    Abstract

    We examine how national culture impacts organisational selection of capital budgeting systems to develop our understanding of what influence a holistic formulation of national culture has on capital budgeting systems. Such an understanding is important as it would not only provide a clearer link between national culture and capital budgeting systems and advance extant literature but would also help multinational firms that have business relationships with Indonesian firms in suitably designing strategies. We conducted semi-structured interviews of selected finance managers of listed firms in Indonesia and Australia. Consistent with the contingency theory, we found that economic, political, legal and social uncertainty impact on the use of capital budgeting systems. The levels of uncertainty were higher in Indonesia than Australia and need to be reckoned in the selection of capital budgeting systems used by firms. We also found that firms are influenced by project size and complexity, when selecting capital budgeting systems.
    Original languageEnglish
    Pages (from-to)43-60
    Number of pages18
    JournalAustralasian Accounting Business and Finance Journal
    Volume11
    Issue number2
    DOIs
    Publication statusPublished - 2017

    Fingerprint

    National cultures
    Capital budgeting
    Indonesia
    Uncertainty
    Political economics
    Multinational firms
    Business relationships
    Finance
    Contingency theory
    Structured interview
    Organizational impacts
    Managers

    Cite this

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    title = "Does National Culture Impact Capital Budgeting Systems?",
    abstract = "We examine how national culture impacts organisational selection of capital budgeting systems to develop our understanding of what influence a holistic formulation of national culture has on capital budgeting systems. Such an understanding is important as it would not only provide a clearer link between national culture and capital budgeting systems and advance extant literature but would also help multinational firms that have business relationships with Indonesian firms in suitably designing strategies. We conducted semi-structured interviews of selected finance managers of listed firms in Indonesia and Australia. Consistent with the contingency theory, we found that economic, political, legal and social uncertainty impact on the use of capital budgeting systems. The levels of uncertainty were higher in Indonesia than Australia and need to be reckoned in the selection of capital budgeting systems used by firms. We also found that firms are influenced by project size and complexity, when selecting capital budgeting systems.",
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    Does National Culture Impact Capital Budgeting Systems? / GRAHAM, Peter; SATHYE, Milind.

    In: Australasian Accounting Business and Finance Journal, Vol. 11, No. 2, 2017, p. 43-60.

    Research output: Contribution to journalArticle

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    AB - We examine how national culture impacts organisational selection of capital budgeting systems to develop our understanding of what influence a holistic formulation of national culture has on capital budgeting systems. Such an understanding is important as it would not only provide a clearer link between national culture and capital budgeting systems and advance extant literature but would also help multinational firms that have business relationships with Indonesian firms in suitably designing strategies. We conducted semi-structured interviews of selected finance managers of listed firms in Indonesia and Australia. Consistent with the contingency theory, we found that economic, political, legal and social uncertainty impact on the use of capital budgeting systems. The levels of uncertainty were higher in Indonesia than Australia and need to be reckoned in the selection of capital budgeting systems used by firms. We also found that firms are influenced by project size and complexity, when selecting capital budgeting systems.

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