Moderating effect of internal control system to determinants influencing the financial statement disclosure
-
Author(s)Khoirul AswarLink to ORCID Index: https://orcid.org/0000-0003-2508-1161
,
Jumansyah Jumansyah
,
Sri Mulyani
,
Mahendro SumardjoLink to ORCID Index: https://orcid.org/0000-0002-6616-9429
-
DOIhttp://dx.doi.org/10.21511/imfi.18(3).2021.10
-
Article InfoVolume 18 2021, Issue #3, pp. 104-112
- Cited by
- 1760 Views
-
716 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
This study examines whether the internal control system moderates the relationship among budget expenditure, government size, legislative size, and audit findings on financial statement disclosure in Indonesia. This is a quantitative study that uses the purposive sampling technique to collect data from 240 local governments in Indonesia. Data were analyzed using Structural Equation Modelling (SEM) with Smart PLS. The results show that government size, legislative size, and audit findings had a positive and significant effect on financial statement disclosure, whereas budget expenditure does not. In addition, the findings revealed that the internal control system moderates the relationship between government size and legislative size and financial statement disclosure, but not by audit findings. The study contributed to extending the institutional and agency theory that explains these factors toward disclosure in the local government in Indonesia. The findings suggest that Indonesia’s local governments consider potential factors regarding increasing pressure to carry out disclosure of financial statements, as well as increasing the proper disclosure required by applicable Indonesian regulations.
- Keywords
-
JEL Classification (Paper profile tab)G38, H83, M41, M48
-
References34
-
Tables3
-
Figures0
-
- Table 1. Summary of the final sample
- Table 2. Summary of descriptive statistic
- Table 3. PLS path algorithm and bootstrapping
-
- Agustina, N., & Setyaningrum, D. (2020). Determinants quality of local government financial statements in Indonesia. Review of Integrative Business & Economics Research, 9(3), 226-239.
- Agustiningsih, S. W., Murni, S., & Putri, G. A. (2017). Audit findings, local government characteristics, and local government financial statement disclosure. Review of Integrative Business & Economics Research, 6(3), 179-187.
- Aljifri, K., Alzarouni, A., & Tahir, M. I. (2014). The association between firm characteristics and corporate financial disclosures: evidence from UAE companies. The International Journal of Business and Finance Research, 8(2), 101-124.
- Arifin, J. (2014). Isomorphic pressures influencing the level of mandatory disclosure within financial statements of Indonesian local governments (Doctoral Thesis). Curtin University.
- Arifin, J. (2020). Disclosure of financial statements on the website: An empirical study in Indonesian local governments. Review of Integrative Business & Economics Research, 9(2), 174-188.
- Aswar, K. (2019). Financial Performance of Local Governments in Indonesia. European Journal of Business & Management Research, 4(6), 1-6.
- Aswar, K., & Saidin, S. Z. (2018). Accrual accounting adoption in java municipalities: An empirical investigation. International Journal of Business & Economic Sciences Applied Research (IJBESAR), 11(3), 24-30.
- Baimukhamedova, A., Baimukhamedova, G., & Luchaninova, A. (2017). Financial disclosure and the cost of equity capital: The empirical test of the largest listed companies of Kazakhstan. The Journal of Asian Finance, Economic and Business, 4(3), 5-17.
- Bakar, N. B. A., & Saleh, Z. (2011). Disclosure of accountability information in public sector: The case of Malaysian Federal Statutory Bodies. 13th Comparative International Governmental Accounting Research (CIGAR) Conference. Ghent, Belgium.
- Budiarto, D. S., & Indarti, L. (2019). Do the characteristics of local government affect the disclosure of local government financial statements? Jurnal Akuntansi Bisnis, 12(1), 19-31. (In Indonesian).
- Committee of Sponsoring Organizations of the Treadway Commission (COSO). (1992). Internal Control–Integrated Framework.
- Dewata, E., Jauhari, H., Aprianti, S., & Hijria, E. N. (2018). The effects of local government characteristics and audit opinion on the performance of district and city governments in Indonesia. Jurnal Dinamika Akuntansi dan Bisnis, 5(2), 151-162.
- Evans, T. G. (2003). Accounting Theory – Contemporary Accounting Issue. USA: Sounth Western.
- Firmansyah, A., Wibowo, P., & Puspitarini, I. (2020). Implementation of accrual-based accounting on regional property in Indonesia: Competence employees and organizational commitments perspective. International Journal of Psychosocial Rehabilitation, 24(7), 9502-9512.
- Gore, A. K. (2014). The effects of GAAP regulation and bond market interaction on local government disclosure. Journal of Accounting and Public Policy, 23(1), 23-52.
- Handoko, F., Pamungkas, V., Syakhroza, A., & Hermawan, A. (2018). Moderating effect of press highlights on the effect of the quality of internal control systems on disclosure in local government financial reports. Advance in Economic, Business and Management Research, 89, 476-484.
- Hardiningsih, P., Januarti, I., Srimindarti, C., & Oktaviani, R. M. (2019). Does the characteristics of regional government and complexity affect on the disclosure regional financial statements? Jurnal Akuntansi & Auditing Indonesia, 23(2), 107-116.
- Hardiningsih, P., Udin, U., Masjojo, G., & Srimindarti, C. (2020). Does Competency, Commitment, and Internal Control Influence Accountability? The Journal of Asian Finance, Economic and Business, 7(4), 223-233.
- INTOSAI. (2004). Guidelines for Internal Control Standards for the Public Sector. Brussels, Belgium.
- Kanapickiene, R., & Keliuotyte-Staniuleniene, G. (2019). Disclosure of non-current tangible assets information in local government financial statements: The case of Lithuania. Economies, 7(4), 116.
- Keerasuntonpong, P., Dunstan, K., & Khanna, B. (2015). Factors influencing disclosures of statements of service performance of New Zealand local authorities. Pacific Accounting Review, 27(3), 304-328.
- Laupe, S., Saleh, F. M., Ridwan, & Mattulada, A. (2018). Factors influencing the financial disclosure of local governments in Indonesia. Academy of Accounting and Financial Studies Journal, 22(3), 1-9.
- Marsella, C., & Aswar, K. (2019). An investigation of financial statement disclosure in local government financial statements. International Journal of Business and Economic Affairs, 4(6), 273-281.
- Martani, D., & Liestiani, A. (2010). Disclosure of Local Government Financial Statements in Indonesia. 22nd Asian – Pacific Conference on International Accounting Issues. Gold Coast, Australia.
- Martinsen, D. S., & Jørgensen, T. B. (2010). Accountability as a differentiated value in supranational governance. The American Review of Public Administration, 40(6), 742-760.
- Muhammad, N., Maheran, N., Jantan, M., & Taib, F. (2010). Moderating effect of information processing capacity to investment decision making and environmental scanning. Business Management Quarterly Review, 1(1), 9-22.
- Murdayanti, Y., Gurendrawati, E., & Iyabu, Y. F. (2014). Analysis of factors affecting level of disclosure in regional sector’s financial statements. Review of Integrative Business & Economics Research, 4(1), 253-261.
- Nor, W., Hudaya, M., & Novriyandana, R. (2019). Financial statements disclosure on Indonesian local government websites: A quest of its determinant. Asian Journal of Accounting Research, 4(1), 112-128.
- Orin, S. K. (2017). The effect of legislation on fourth amendment protection. 115 Michigan Law Review, 117.
- Patrick, P. A. (2007). The determinants of organizational innovativeness: the adoption of GASB 34 in Pennsylvania local government (Thesis). The Pennsylvania State University.
- Purnama, H., & Alfina, P. (2019). Which ones are more important: Characteristics or complexities? a study of the disclosure in local government financial reports. Journal of Business & Information Systems, 1(2), 77-88.
- Rahman, M.S., & Sobhan, R. (2020). The Impact of Intellectual Capital Disclosure on Firm Performance: Empirical Evidence from Pharmaceutical and Chemical Industry of Bangladesh. The Journal of Asian Finance, Economic and Business, 7(2), 119-129.
- Suwardjono. (2014). Financial reporting engineering accounting theory (3rd ed.). Yogyakarta: BPFE Yogyakarta.
- Suwanda, D. (2013). Optimization of local government asset management. Jakarta: PPM Management.
-
Perceived health risk, online retail ethics, and consumer behavior within online shopping during the COVID-19 pandemic
Yuniarti Fihartini ,
Arief Helmi ,
Meydia Hassan ,
Yevis Marty Oesman
doi: http://dx.doi.org/10.21511/im.17(3).2021.02
Innovative Marketing Volume 17, 2021 Issue #3 pp. 17-29 Views: 4454 Downloads: 1707 TO CITE АНОТАЦІЯThe risk of virus contracting during the COVID-19 pandemic has changed consumer preference for online shopping to meet their daily needs than shopping in brick-and-mortar stores. Online shopping presents a different environment, atmosphere, and experience. The possibility of ethical violations is higher during online than face-to-face transactions. Therefore, this study was conducted to investigate the influence of perceived health risk and customer perception of online retail ethics on consumer online shopping behavior during the COVID-19 pandemic, involving seven variables, namely perceived health risk, security, privacy, non-deception, reliability fulfillment, service recovery, and online shopping behavior. The data were collected through an online survey by employing the purposive sampling technique to a consumer who has shopped online during the COVID-19 pandemic in Indonesia. 315 valid responses were obtained and analyzed through quantitative method using SEM-Amos. The results showed that perceived health risk and four variables of online retail ethics including security, privacy, reliability fulfillment, and service recovery affected online shopping behavior. Meanwhile, non-deception was found to have an insignificant effect. The coefficient value proved perceived health risk to be more dominant in influencing online shopping behavior than the variables of online retail ethics. Thus, consumers pay more concern for their health during online shopping. However, positive consumer perceptions of the behavior of online retail websites in providing services also can encourage consumers to shop online during this pandemic.
-
Human resource management in promoting innovation and organizational performance
I Gede Riana ,
Gede Suparna ,
I Gusti Made Suwandana ,
Sebastian Kot 
,
Ismi Rajiani
doi: http://dx.doi.org/10.21511/ppm.18(1).2020.10
Problems and Perspectives in Management Volume 18, 2020 Issue #1 pp. 107-118 Views: 3496 Downloads: 826 TO CITE АНОТАЦІЯHuman resource management (HRM) is one of the elements enabling an organization to remain competitive in turbulence conditions. The effective practice of HRM makes competent and innovative employees contributing to the achievement of organizational objectives. This study aims to analyze HRM practices in creating innovation and organizational performance. The questionnaire was used to measure the respondents’ perceptions of variables used by a Likert scale. A survey of 126 manager samples and middle managers at export-oriented short and medium enterprises (SMEs) in Bali, Indonesia, was conducted to test the model. The analysis has shown that the proposed model was proven to be compliant with the research hypotheses. HRM significantly affects organizational performance and innovation, and it was found out that innovation can improve organizational performance. However, in the process of simultaneous testing, it was found out that innovation cannot improve organizational performance. The lack of attention to investments in human resources became one of the barriers to SMEs in creating innovation.
-
Positive contribution of the good corporate governance rating to stability and performance: evidence from Indonesia
RR. Iramani , Muazaroh Muazaroh , Abdul Mongid
doi: http://dx.doi.org/10.21511/ppm.16(2).2018.01
Problems and Perspectives in Management Volume 16, 2018 Issue #2 pp. 1-11 Views: 3157 Downloads: 309 TO CITE АНОТАЦІЯThis paper aims to examine the impact of Good Corporate Governance (GCG) practice on bank stability and performance. Governance is measured using the GCG rating that covers eleven aspects. The authors apply instrumental regression to link governance to performance and stability. The study covers a sample of 150 banks. The result shows that bank stability can mediate bank governance and bank performance. On the determinant of bank performance, it can be concluded that the GCG rating is positive and directly influences bank performance. Bank stability is also positive for bank performance indicating the indirect contribution of the GCG rating to bank performance. NPL, LDR, CAR and bank’s size (LASSET) are all negative and significant. The aim of this paper is to provide strong empirical evidence on the importance of governance and stability for performance. The limitations of this paper are the size of the sample and that it only covers public banks which are theoretically required to apply better governance in all aspects of their business by the Capital Market Authority.
