The Influence of Institutional Pressure on Budgetary Slacks by Utilization of Information Technology as A Mediation Variable

Abstract: Some local government funding comes from central government transfer income so that local governments experience institutional pressure to obey regulations that issued by the central government in the budgeting process. Research on the effects of institutional pressure on budgetary slack is still rarely found. The purpose of this study is to determine the effect of coercive pressure, mimetic pressure and normative pressure on budgetary slack by using information technology as a mediating variable. The sample is determined by the nonprobability sampling method, a purposive sampling technique. The number of samples was 38 Badung Regency Organizations with 100 echelon III and IV officials as respondents collected through questionnaires. Partial Least Squares (PLS) is used for data analysis with the help of SmartPLS 2.0 M3 software. The results of data analysis show that coercive pressure, mimetic pressure and normative pressure have positive effects on budgetary slack, the use of information technology has a negative effect on budgetary slack. Coercive pressure, mimetic pressure and normative pressure affect budgetary slack through the use of information technology. Keywords: institutional pressure, coercive pressure, mimetic pressure, normative pressure, utilization of information technology and budgetary slack