Managerial characteristics and budget use in festival organizations
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Managerial characteristics and budget use in festival organizations Per Ståle Knardal1 · Trond Bjørnenak2 Accepted: 14 September 2020 © The Author(s) 2020
Abstract Festivals are an important part of popular culture and have increased in popularity in recent decades. However, they remain relatively unexplored in the accounting literature, and understanding of the use of management control tools in this context is low. This study aims to investigate the use of budgets in festivals. Informed by upper echelons theory, it investigates how individual and observable characteristics of festival managers are associated with variations in the use of budgets. The study is based on a survey of 61 festival managers from 40 festivals. The findings suggest that festival budgets are particularly important in the planning and coordination process but used less frequently for ex post evaluations. The findings also indicate a positive association between a business educational background and the use of budgets for most purposes, with the exceptions of performance evaluation and reward. This paper contributes to the literature on accounting in popular culture in general and in festivals specifically. Through its application of upper echelons theory, it also contributes to the management accounting and control literature, showing how individual characteristics of managers influence the use of budgets. Keywords Festivals · Upper echelons · Control system characteristics · Budget · Budgeting JEL Classification M20 · M41
* Per Ståle Knardal [email protected] 1
Norwegian University of Science and Technology, Klæbuveien 72, 7032 Trondheim, Norway
2
Norwegian School of Economics, Helleveien 30, 5045 Bergen, Norway
13
Vol.:(0123456789)
P. S. Knardal, T. Bjørnenak
1 Introduction In recent decades, there has been an increasing number of festivals (Aagedal et al. 2009; Anderton 2008), and these are an important part of popular culture (Jeacle 2012, 2017). Festivals can be understood as periodically recurrent, social and open occasions that last for several days and contain a series of coordinated events with a theme that is culturally significant for the local community (Falassi 1987; Getz et al. 2010; Tjora 2016). The growth in the number of festivals means that the festival sector has increased in economic and cultural significance (Aagedal et al. 2009; Tjora 2013; Toraldo and Islam 2019). In many cases, in rural towns in particular, festivals may be necessary to make places economically viable and culturally alive (Tjora 2016). The growth in festivals also means that there is greater competition to attract a large enough audience to secure the necessary revenues. This is just one of the many uncertainties that may create economic problems for festivals, including the weather, the constantly changing cultural landscape, shifting trends and the uncertainty of resource access from both public and private actors. Hence, numerous factors are involved in any explanation of the economic conditions of festivals. Research studie
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