Factors Affecting Financial Condition of Local Government in Indonesia

Ritonga, Irwan Taufiq; Clark, Colin; Wickremasinghe, Guneratn B

doi:10.18196/jai.2002114

Cited by 39 publications

(86 citation statements)

References 26 publications

(51 reference statements)

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“…Accounting is also an accounting system that recognizes and presents economic transactions or events when an event occurs without seeing cash or cash equivalents obtained or issued (Jones and Pandlebury, 2004;, Weygant et al, 2011;PP No. 71 of 2010;Ritonga, 2010;Harun, 2009;Robinson and Harun, 2004).…”

Section: Hypothesis Testingmentioning

confidence: 99%

“…Accrual-based accounting according to Ritonga (2010) that accrual-based accounting means income, expenditure, financing, assets, liabilities and equity funds are recognized and recorded at the time of transactions without regard to when cash or cash equivalents are received or paid. While Simanjuntak defines accrualbased accounting as an accounting basis in which economic transactions and other events are recognized, recorded and presented in the financial statements at the time of the transaction, regardless of the time cash or cash equivalents are received or paid.…”

Section: Timelinesmentioning

confidence: 99%

“…Based on the explanation above, it can be concluded that the focus of accrual-based accounting systems is on measuring economic resources and changing power in an entity. Accounting is also an accounting system that recognizes and presents economic transactions or events when an event occurs without seeing cash or cash equivalents obtained or issued (Jones and Pandlebury, 2004;Ritonga, 2010;Harun, 2009;Robinson and Harun, 2004). According to Ouda there are three (3) accrual-based accounting implementation dimensions including:…”

Section: Timelinesmentioning

confidence: 99%

See 2 more Smart Citations

Acrual Basis in Accounting Information Systems and its Impact on the Quality of Information

Safkaur¹,

Nurafiah²,

Poulus³

et al. 2020

J. Eng. Appl. Sci.

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The implementation of regional autonomy as an embodiment of the system of good governance is characterized by the proliferation of problems with the lack of quality accounting information produced both by the central government and regional governments in Indonesia, one of the trigger factors for the lack of quality accounting information caused by the application of accounting systems not yet effective by various government agencies in Indonesia. This study aims to find out how the application of accrual basis in accounting system at the government and its influence on the quality of accounting information that it produces. This study uses the method of verifying causality to determine the effect between variables. The population in this study were as many as 44 district and city governments of Papua and West Papua provinces. Whereas the observation unit is DPKAD in 44 provinces/cities/districts in the Papua and West Papua regions. Sampling technique uses a census so that all members of the population become the study sample. The results of this study show empirical evidence that the application of accrual basis to the accounting system influences the quality of accounting information generated from the financial statements of 44 regency and city governments in the provinces of Papua and West Papua.

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Section: Hypothesis Testingmentioning

confidence: 99%

Section: Timelinesmentioning

confidence: 99%

Section: Timelinesmentioning

confidence: 99%

See 1 more Smart Citation

Acrual Basis in Accounting Information Systems and its Impact on the Quality of Information

Safkaur¹,

Nurafiah²,

Poulus³

et al. 2020

J. Eng. Appl. Sci.

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“…Hampir seluruh pemerintah daerah di Indonesia mengalami kondisi ketergantungan tinggi yang membuat pemerintah daerah memerlukan instrumen yang baik untuk mengelola keuangan daerah tersebut (Ritonga, Clark, & Wickremasinghe, 2012). Eksekutif cenderung menentukan target lebih rendah (underforecast) pada komponen pendapatan (Marlowe, 2009).…”

Section: Hipotesis Penelitian Efek Ratchet Pada Anggaran Pendapatan Dunclassified

Varian Anggaran Dan Peran Akuntansi Pertanggungjawaban Pada Penganggaran Pemerintah Daerah

Susanto

2018

EkBis

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ABSTRACTBudget variance plays important roles in Indonesian Local Government budgeting. The use of budget variance through budgeting highlight the incrementalism of budget which define the budget setter’s behavioral bias through ratchet effect. Ratchet effect occurs when budget setter use prior period performance (i.e budget variance) as basis to determine the upcoming budget as a consequences of the dynamic incentives problems in agency relation context. This study aims to find whether ratchet effecct occur in public sector budgeting, especially in Indonesian local government budgeting. Further, this research examine the role of responsibility accounting in explaining the presence of ratchet effect in Local Government budget. This study use Local Government Task Force (SKPD) of Yogyakarta Special Region Province Government as research object for research period between 2012 to 2016. Selection of sample derived using purposive sampling to 31 SKPD and generates 17 sample which has Region Original Revenue (PAD) component and so 28 sample which has Direct Expenditure component in each of it’s budget structure. Multiple Linear Regresion and Independent Samples Test were used to test the hypotheses.The result shows that all research hypotheses statistically accepted. This research generate evidence the occurence of ratchet effect and the important role of responsibility accounting in local government budgeting.Keyword: Budget Variances, Ratchet Effect, Responsibility Accounting, Local Government Budgeting, Region Origin Revenue (PAD), Direct Expenditure. INTISARI Varian anggaran merupakan informasi penting dalam penyusunan anggaran pemerintah daerah di Indonesia. Penggunaan varian anggaran dalam penganggaran mengandung aspek inkrementalisme dalam bentuk efek ratchet yang muncul akibat bias perilaku penyusun anggaran. Efek ratchet muncul ketika perencana angggaran menentukan target anggaran berdasarkan capaian kinerja anggaran periode sebelumnya sebagai akibat adanya persoalan insentif dinamik dalam konteks hubungan keagenan. Penelitian ini dilakukan untuk mengetahui adanya efek ratchet dalam penganggaran pemerintah daerah di Indonesia. Lebih lanjut, penelitian ini mengevaluasi peran akuntansi pertanggungjawaban dalam menjelaskan munculnya efek ratchet dalam anggaran pemerintah daerah. Penelitian ini menggunakan sampel Satuan Kerja Perangkat Daerah (SKPD) di lingkup Pemerintah Provinsi Daerah Istimewa Yogyakarta pada periode 2012-2016. Pemilihan sampel dilakukan dengan metode sampel purposif atas 31 SKPD dan menghasilkan 17 sampel SKPD yang memiliki komponen Pendapatan Asli Daerah (PAD) dan 28 sampel SKPD yang memiliki komponen Belanja Langsung dalam struktur anggarannya. Analisis yang digunakan untuk pengujian hipotesis adalah analisis regresi linier berganda dan independent samples test. Hasil penelitian menunjukkan semua hipotesis penelitian ini terdukung secara statistik. Hasil penelitian ini membuktikan adanya efek ratchet dan peran penting akuntansi pertanggungjawaban dalam penyusunan anggaran pemerintah daerah.Kata Kunci: Varian Anggaran, Efek Ratchet, Akuntansi Pertanggungjawaban, Penganggaran Pemerintah Daerah, Pendapatan Asli Daerah, Belanja Langsung.

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“…The score grading system of the international credit rating agencies used by Standard and Poor (2014), Fitch Ratings (Fitch), (2014) and Moody"s Investors Service (Moody) (2014), which is similar to the grade score point system currently adopted in the academia is adopted in operationalizing raw financial solvency indicators derived to determine the ultimate financial condition index of the model. Values of financial distress index of a predictor in each models one, four and five, range from 0.01 to 0.99 (Ritonga, 2014); "A" = Excellent, "B" = Very Good, "C" = Average, "D" = Fair but below average, and "E" = Weak. The values from 1-49 in these first category models signify financial distress while 50 and above is an indication of positive financial performance, solvency and sustainability (Roubini, 2001).…”

Section: Operationalization Of Public Fhi Measurementsmentioning

confidence: 99%

Sovereign treasury solvency and financial performance management in Nigeria

Alozie¹

2018

J. Econ. Int. Finance

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The paper assessed sovereign treasury solvency and financial performance management in Nigeria from 1999 through 2016. The aim of this study is to determine the degree of solvency in Nigeria"s sovereign treasury. Ex-post "facto" empirical analysis is the research method employed. Financial analysis was employed with financial performance indicators; descriptive statistics, econometric evaluation processes, and combined multiple discriminant analysis with logistic regression model as techniques of analyses. Result of the measure of solvency yields "A" performance grade score and credit rating, indicating that Nigeria"s sovereign treasury is solvent and in stable, holding other factors constant. The paper recommends obtaining public loans, which should be restricted to 50% of revenue or reserve financial assets as new policy measure to minimize excessive debt accumulation.

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Factors Affecting Financial Condition of Local Government in Indonesia

Cited by 39 publications

References 26 publications

Acrual Basis in Accounting Information Systems and its Impact on the Quality of Information

Acrual Basis in Accounting Information Systems and its Impact on the Quality of Information

Varian Anggaran Dan Peran Akuntansi Pertanggungjawaban Pada Penganggaran Pemerintah Daerah

Sovereign treasury solvency and financial performance management in Nigeria

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