THE EFFECT OF BUDGETARY PARTICIPATION ON BUDGETARY SLACK USING BUDGETARY ETHICAL COMPLIANCE AS THE MEDIATING AND MODERATING VARIABLE

This study aims to empirically analyze the relationship between budgetary participation and budgetary slack using budgetary ethical compliance as the mediating and moderating variable. Data were collected through survey method involving heads of work regional unit, secretaries, heads of planning division, heads of equipment division, heads of program development section and head of equipment section in North Maluku province as participants. The respondents were 185 in total. SPSS AMOS 20 version was used to test the hypotheses. The results show that first, budgetary participation has negative effect on budgetary slack. Second, budgetary participation has significant positive effect on budgetary ethical compliance. Third, budgetary ethical compliance significantly, negatively affects budgetary slack. The variable of budgetary ethical compliance was the mediator of the relationship between budgetary participation and budgetary slack. Moderating variables (interactions of budgetary participation and budgetary ethical compliance) have negative and insignificant estimated coefficient value.