In the context of budget preparation, which of the following is a disadvantage of participatory budgeting?
A) It can lead to budgetary slack.
B) It fails to motivate middle and first-line managers.
C) It results in an inadequate representation of the issues faced by individual departments.
D) It fails to identify the resources needed to achieve goals.

Question

Quizplus · Accepted Answer

Participatory budgeting can lead to budgetary slack because managers involved in the budgeting process may intentionally overestimate expenses or underestimate revenues to make it easier to achieve budgetary targets.

In the Context of Budget Preparation, Which of the Following