Proceedings

eliable. Of all indices in Table 2 just NFI is slightly less than acceptable range and it
is due to the complexity of the model (Kline, 2005), however for assessing the fitness
of a model reliance on the combination of indices (not just one index) has been
recommended (Byrne, 2001, Shook et al., 2004). Figure 3 indicates the graphic results
of the run of this model. In that Figure, rectangles represent observed variables and
ellipses show the latent variables. Factor loadings (between observed and latent
variables), common variances (as indicators of strength of relationship), and
regression coefficients (between latent variables or factors) can be found on figure
below in standardized form.
Table 2. Indices of fit for the Accounting System Model
The abbreviations that have been used in Figures 3 (previous page) and 4 and Tables 3
Index
Model
and 5 mean as below:
CMIN DF CMIN/DF CFI NFI RMSEA
Real values 624 510 1.224 .975 .881 .030
Acceptable
values
N/A N/A Less than 3 More than .9 More than .9 Less than .05
DECENT = Decentralization
COMPOS = Competitive Position
FINPRE = Financial Pressure
IMPACC = Improved Accounting System
BUDEMP = More Budget Control
PARBUD = Participative Budgeting
SATBUD = Satisfaction with Budgets
REWSYS = Appropriateness of Reward System
USACPM = Use of Accounting in Performance Management
COMPME = Comprehensive Performance Measures
Based on the estimations resulted from SEM analysis (presented in Table 3) which are
mostly consistent with the literature, it can be claimed that “improvement of
accounting system” is related to “competitive position” (+.40); however this
relationship could not be confirmed with “decentralization” (+.04) and “financial
pressure” (+.08). On the other hand the association of “participative budgeting” with
“decentralization” (+.37) and “financial pressure” (-.22) was supported. Moreover, it
was confirmed that the universities with higher “financial pressure” and more
“decentralization” (more delegated authority) put more “emphasis on budget
controls”, though the association with “financial pressure” (+.44) was found stronger
than “decentralization” (+.12). In addition, the positive effect of “improved
accounting system” (+.13) and “participative budgeting” (+.31) on “universities’
performance” was confirmed, nevertheless the negative effect of “budget control” was
not found so significant (-.06). Furthermore, “competitive advantage” does not seem
to mediate the relationship between “improved accounting system” and “universities’
performance” (+.003), but partial mediation of “satisfaction with budgets” on
association between “participative budgeting” and “performance” was found
significant (+.14).
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