What is the role of top management in a participative budgeting system?

Question

Quizplus · Accepted Answer

Top management plays a critical role in ensuring that employee-generated objectives are consistent with those of the company. While lower-level employees are responsible for creating the budget, top management must provide guidance and make sure that the budget aligns with the overall objectives and goals of the company. It is also important for top management to communicate any changes or modifications made to the budget to ensure transparency and participation from all levels of employees. Option A is incorrect as top management has a crucial role in participative budgeting. Option B is incorrect, as the purpose of participative budgeting is to encourage employee participation and ownership of the budget, rather than simply tightening or eliminating slack. Option D is incorrect, as option B is incorrect.

What Is the Role of Top Management in a Participative