A Review of the Role of Contractibility in Performance Measurement System (Case Study: Mashhad Municipality)

Document Type : Research Paper

Authors

1 department of accounting, Faculty of Economics & Administrative Sciences, ferdowsi university of mashhad, mashhad, iran

2 Department of Accounting Ferdowsi University of Mashhad

3 Assistant Professor,Department of Statistics,Ferdowsi University of Mashhad,Mashhad-Iran.

Abstract

Journal of Accounting Advances, (2020) 12(1): 263-298
DOI: 10.22099/JAA.2020.33372.1866
  Journal of Accounting Advances (JAA)
Journal homepage: www.jaa.shirazu.ac.ir/?lang=en
A Review of the Role of Contractability in Performance Measurement System (Case Study: Mashhad Municipality)

 
ABSTRACT
Received: 2020-5-12
Accepted: 2020-8-25
 
َccountings are always striving to provide organizational performance development opportunities through the establishment of an optimal performance use system. It will challenge. Therefore, this study aimed to investigate the performance of performance use systems in the public sector (Mashhad municipality) and, ultimately, whether performance use systems are effective in performance under contractbility conditions, It has also been explored. Contractability includes the transparency of goals, the ability to select distorted performance metrics, and the degree to which managers know and control the process of change. Structural equation technique, which is used for systematic analysis of survey data, measurement of theoretical structures (hidden variables) and their relationships, is used for statistical analysis. 1397 has been scrutinized. The findings indicate that contractability has a positive and significant effect on the exploratory use and Incentive-oriented use of performance use systems. However, under contractbility terms, the use of exploratory and incentive-based use in the performance use system had no significant effect on organizational performance. Also, the results of this study indicate that there is no relationship between contractability and organizational. These findings have important implications for managers' performance in designing performance evaluation systems in the organization and considering different roles of the evaluation system in the public sector. Since performance use is closely related to the dimensions specified in the performance criteria, the focus on applying the concepts of performance use criteria to the concept of contractability in the present study has been such as to give confidence to the organization under investigation. It is a step in the right direction.

 
   
1- Introduction
       In this research, we hypothesize that the way in which performance measurement systems are being used, affects organizational performance, and that these performance effects depend on contractibility. The findings have important implications, both for practice and for public policy.
 
2- Hypotheses
Research hypotheses developed as follows:
H1. Contractibility has a positive and significant effect on performance.
H2. The incentive-oriented use of performance measurement systems has a significant effect on performance.
H3. The contractibility has a significant effect on incentive-oriented use.
H4. The exploratory use of performance measurement systems has a significant effect on performance.
H5. The contractibility has a significant effect on the exploratory use of performance measurement systems.
 
3- Methods
       To test the hypotheses, we used survey data from public sector organizations in the Mashhad Municipality. We sought to identify a model for investigating the relationships between the use of performance measurement systems. Consequently, the structural equations and AMOS software have been used.
 
4- Results
       The results showed that contractibility does not effect on the organizational performance. Also, we find that contractibility does positive effect on the exploratory use and incentive performance of the performance measurement system.
 
5- Conclusion
The purpose of this research is to measure the use of performance measurement systems and detection the type of use of the performance measurement system in public sector. Results recommend that organizations design a system that will provide the best feedback to continuously improve in organization.
 
Keywords: Performance Measurement Systems, Contract Theory, Agency Theory, Contractibility.
 
 

Keywords

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Journal of Accounting Advances
Volume 12, Issue 1 - Serial Number 80
December 2020
Pages 263-298

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History

  • Receive Date: 07 May 2019
  • Revise Date: 21 August 2020
  • Accept Date: 25 August 2020

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