Gamayuni, Rindu Rika (2018) The Effect of Internal Audit Function Effectiveness and Implementation of Accrual Based Government Accounting Standard on Financial Reporting Quality. Review of Integrative Business and Economics Research, 7 (1). pp. 46-58. ISSN ISSN: 2304-1013 (Online); 2304-1269

Preview

Text riber_7-s1_sp_h17-021_46-58.pdf Download (251kB) | Preview

Abstract

This study was conducted based on the phenomenon that the internal audit function is still not effective and the low quality of financial reporting. Implementation of the new Indonesian Government Accounting Standards (SAP) based on the accrual basis was applied starting in 2015 so that it was necessary to study the weaknesses and advantages as well as its influence in improving the quality of financial reporting. The purpose of this study was to obtain empirical evidence and review of the (1) effect of the internal audit function effectiveness on the quality of financial reporting, (2) effect of the implementation of accrual based government accounting standards (SAP) on the financial reporting quality. The sample of this study was the Inspectorate at Provincial / District / City in Lampung, Indonesia. This study used primary data with questionnaires as instrument, and analyzed by SEM PLS (Structural Equation Model - Partial Least Square). The results of this study provided empirical evidence that the effectiveness of the internal audit function had significant effect to the quality of financial reporting, but the implementation of accrual based Government Accounting Standard (SAP) did not support the hypothesis due to the implementation of accrual based SAP recently required to be applied starting in 2015 so there were still a lot of officials who did not understand it. Therefore, it had no significant effect on to the quality of financial reporting. The weaknesses of the effective internal audit function, especially in terms of resource management were coordination, reporting to the leadership, program development and quality control, and follow-up of public complaints. The weaknesses in the implementation of accrual based government accounting standards were in terms of the presentation of the components of financial statements, recognition and measurement, correction and the consolidated financial statements. The local government needed to address the inadequacies in order to improve the quality of local government financial reporting.

Item Type:	Article
Subjects:	H Social Sciences > HJ Public Finance
Divisions:	Fakultas Ekonomi dan Bisnis (FEB) > Prodi Akuntansi
Depositing User:	rindu rika
Date Deposited:	21 Jun 2018 07:10
Last Modified:	21 Jun 2018 07:10
URI:	http://repository.lppm.unila.ac.id/id/eprint/7430

Actions (login required)

View Item