Development and Validation of a Financial Literacy Assessment Instrument for Public-Sector Managers

Samireh Naserian Asl; Mohammad Reza Dehghani ashkezari; Mahmood Moein Addin; Mahdieh Motamedi

Authors

Samireh Naserian Asl Department of Management, Ya. C., Islamic Azad University, Yazd, lran Author https://orcid.org/0000-0001-9340-6824
Mohammad Reza Dehghani ashkezari Department of Management, Ya. C., Islamic Azad University, Yazd, Iran https://orcid.org/0000-0002-5868-7808
Mahmood Moein Addin Department of Accounting, Ya. C., Islamic Azad University, Yazd, Iran Author https://orcid.org/0000-0002-6226-0727
Mahdieh Motamedi Department of Management, Ya. C., Islamic Azad University, Yazd, Iran Author https://orcid.org/0000-0002-1141-5610

Keywords:

Financial literacy, public, sector managers, instrument development, psychometric validation, exploratory factor analysis, reliability, public financial management

Abstract

This study aimed to develop and validate a multidimensional instrument for assessing financial literacy among public-sector managers. This methodological, cross-sectional instrument-validation study was conducted among public-sector managers employed in governmental organizations in Yazd Province, Iran. The initial item pool was developed to represent financial competencies relevant to public-sector management and was refined through face and content validity assessment. The resulting questionnaire was administered to eligible managers with experience in financial, budgetary, administrative, or resource-allocation responsibilities. Construct validity was assessed using exploratory factor analysis. Sampling adequacy and factorability were evaluated through the Kaiser–Meyer–Olkin measure and Bartlett’s test of sphericity. Principal component analysis with Varimax rotation was applied to identify the underlying dimensions. Items with inadequate or ambiguous factor loadings were removed or revised. Internal consistency reliability was examined using Cronbach’s alpha for the total scale and each identified dimension. The Kaiser–Meyer–Olkin coefficient was 0.861, and Bartlett’s test of sphericity was statistically significant at p < .001, confirming the suitability of the data for factor analysis. Exploratory factor analysis identified five factors with eigenvalues greater than 1.00, jointly explaining 68.40% of the total variance. The dimensions were Financial Regulatory Compliance, Financial Analysis and Decision-Making, Capital and Resource Management, Financial Behavior and Transparency, and Financial and Budgetary Knowledge. Primary factor loadings ranged from 0.74 to 0.82, with no substantial cross-loadings. Cronbach’s alpha coefficients ranged from 0.80 to 0.88 for the five dimensions and reached 0.92 for the total 15-item scale, indicating satisfactory to very high internal consistency. The developed instrument demonstrated a clear five-factor structure, strong factor loadings, and high internal consistency, supporting its validity and reliability for assessing financial literacy among public-sector managers. The scale can provide both an overall financial literacy score and separate scores for regulatory, analytical, resource-management, behavioral, and foundational knowledge dimensions.

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