The Role of Follow-up of Audit Recommendations and Financial Performance on Incumbents Electability in Indonesia
DOI:
https://doi.org/10.52158/jaa.v3i2.1031
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Keywords:
Elektabilitas Petahana, Tindak Lanjut Rekomendasi Audit, Kinerja Keuangan, Kemandirian Keuangan
Abstract
This study aims to analyse the effect of follow-up of audit recommendations and local government financial performance on incumbent electability. Using a quantitative approach and secondary data from local elections in Indonesia in 2017, 2018, and 2020, this study involved a final sample of 428 observations consisting of 26 governor elections, 76 mayor elections, and 326 regent elections. The results show that the main variables analysed, namely follow-up to audit recommendations and financial performance, play a role in increasing the electability of incumbents. Good local government financial management, especially those related to accountability and sustainability of local finances, was shown to affect the level of electability of incumbents. This study has important implications for local government awareness of the role of audit practices and government financial management in increasing public trust and satisfaction. The findings emphasize the importance of implementing good financial governance and accountability as one of the factors that can support increased political support for incumbents in general elections.
Keywords: Incumbent Electability, Follow-up of Audit Recommendations, Financial Performance, Financial Independence.
References
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Ratna Ayu Damayanti, D. D. (2021). Financial Performance Information and Voters’ Behaviorfor the Re-election of Incumbent Regional Heads. Psychology and Education Journal, 58(1), 330–338. https://doi.org/10.17762/pae.v58i1.780
Setyaningrum, D. (n.d.). The Direct and Mediating Effects of An Auditor’s Quality and the Legislative’s Oversight on the Follow-up of Audit Recommendation and Audit Opinion.
Stalebrink, O. J., & Sacco, J. F. (2007). Rationalization of financial statement fraud in government: An Austrian perspective. Critical Perspectives on Accounting, 18(4), 489–507. https://doi.org/10.1016/j.cpa.2006.01.009
Yuniar, L., Yamin, N., & Jurana. (2021). Accountability: Implications of the Effect of Understanding Government Accounting Standards and Internal Control Against Quality of Financial Statements. Jurnal AKSI (Akuntansi Dan Sistem Informasi), 6(2). https://doi.org/10.32486/aksi.v6i2.18
Aksa, F., Saputra, M., & Zuraida. (2019, September). THE EFFECT OF FINANCIAL PERFORMANCE, AUDIT OPINION AND CORRUPTION LEVEL OF SELECTION OF INCUMBENT REGIONAL HEADS IN ELECTIONS IN THE GOVERNMENT DISTRICT AND CITY IN ACEH. Int. j. of Social Science and Economic Research, 4(9), 6130-6140. Retrieved from ijsser.org/more2019.php?id=470
Anderson, C. J. (2007). The End of Economic Voting? Contingency Dilemmas and the Limits of Democratic Accountability. Annual Review of Political Science, 10(1), 271–296. https://doi.org/10.1146/annurev.polisci.10.050806.155344
Balaguer-Coll, M. T., & Brun-Martos, M. I. (2013). El efecto del gasto público sobre las posibilidades de reelección de los gobiernos locales. Revista de Contabilidad, 16(1), 74–80. https://doi.org/10.1016/S1138-4891(13)70008-6
Bouvet, F., & King, S. (2016). Income inequality and election outcomes in OECD countries: New evidence following the Great Recession of 2008–2009. Electoral Studies, 41, 70–79. https://doi.org/10.1016/j.electstud.2015.11.006
Brender, A. (2003). The effect of fiscal performance on local government election results in Israel: 1989–1998. Journal of Public Economics, 87(9–10), 2187–2205. https://doi.org/10.1016/S0047-2727(02)00045-2
Brusca, I., & Montesinos, V. (2006). Are Citizens Significant Users of Government Financial Information? Public Money and Management, 26(4), 205–209. https://doi.org/10.1111/j.1467-9302.2006.00526.x
Cuadrado-Ballesteros, B., Santis, S., Citro, F., & Bisogno, M. (2019). Does financial health influence the re-election of local governments? Journal of Public Budgeting, Accounting & Financial Management, 31(3), 345–363. https://doi.org/10.1108/JPBAFM-10-2018-0114
Darmawati, Pagalung, G., Mediaty, & Damayanti, R. A. (2019). Effect of the Contents of Information on the Accountability of the Implementation of the Regional Revenue and Expenditure Budget Against the Re-Election of Incumbents. Proceedings of the 3rd International Conference on Accounting, Management and Economics 2018 (ICAME 2018). Proceedings of the 3rd International Conference on Accounting, Management and Economics 2018 (ICAME 2018), Makassar, Indonesia. https://doi.org/10.2991/icame-18.2019.60
David, S., Furqan, A. C., Gunarsa, A., & Sitorus, S. M. (2024). Budgeting Patterns for Regional Government Functions: Impact of Election of Regional Heads & Incumbents (Study of Regional Government in Indonesia). In A. Patunru, M. Ahmad, M. Nohong, A. Arifuddin, A. I. Anwar, R. N. P. Nugraha, & R. Kurniawan (Eds.), Proceedings of the 8th International Conference on Accounting, Management, and Economics (ICAME 2023) (Vol. 279, pp. 450–465). Atlantis Press International BV. https://doi.org/10.2991/978-94-6463-400-6_34
Din, M., Munawarah, Ghozali, I., & Achmad, T. (2017). The Follow Up of Auditing Results, Accountability of Financial Reporting and Mediating Effect of Financial Loss Rate: An Empirical Study in Indonesian Local Governments. EUROPEAN RESEARCH STUDIES JOURNAL, XX(Issue 4A), 443–459. https://doi.org/10.35808/ersj/846
Ferraz, C., & Finan, F. (2011). Electoral Accountability and Corruption: Evidence from the Audits of Local Governments. American Economic Review, 101(4), 1274–1311. https://doi.org/10.1257/aer.101.4.1274
Furqan, A. C., Wardhani, R., Martani, D., & Setyaningrum, D. (2021). Financial reporting, public services and local executives’ re-electability in Indonesia. Cogent Business & Management, 8(1), 1939229. https://doi.org/10.1080/23311975.2021.1939229
James, O., & John, P. (2006). Public Management at the Ballot Box: Performance Information and Electoral Support for Incumbent English Local Governments. Journal of Public Administration Research and Theory, 17(4), 567–580. https://doi.org/10.1093/jopart/mul020
Muliyati, D., Amir, A. M., Zahra, F., Ridwan, Yamin, N. Y., Pakkawaru, M. I., & Masruddin. (2021). The Effect of the Adoption of Government Accounting Standards, Apparatus Competence and Accounting Information System on the Quality of Local Government Financial Reports: International Conference on Strategic Issues of Economics, Business and, Education (ICoSIEBE 2020), Medan, Indonesia. https://doi.org/10.2991/aebmr.k.210220.057
Purwanti, D. (2023). Does Government Accounting Information Matter to Gain Votes? Evidence from Local Elections in Indonesia. Gadjah Mada International Journal of Business, 25(3), 355. https://doi.org/10.22146/gamaijb.64668
Ratna Ayu Damayanti, D. D. (2021). Financial Performance Information and Voters’ Behaviorfor the Re-election of Incumbent Regional Heads. Psychology and Education Journal, 58(1), 330–338. https://doi.org/10.17762/pae.v58i1.780
Setyaningrum, D. (n.d.). The Direct and Mediating Effects of An Auditor’s Quality and the Legislative’s Oversight on the Follow-up of Audit Recommendation and Audit Opinion.
Stalebrink, O. J., & Sacco, J. F. (2007). Rationalization of financial statement fraud in government: An Austrian perspective. Critical Perspectives on Accounting, 18(4), 489–507. https://doi.org/10.1016/j.cpa.2006.01.009
Yuniar, L., Yamin, N., & Jurana. (2021). Accountability: Implications of the Effect of Understanding Government Accounting Standards and Internal Control Against Quality of Financial Statements. Jurnal AKSI (Akuntansi Dan Sistem Informasi), 6(2). https://doi.org/10.32486/aksi.v6i2.18
Published
2024-12-01
How to Cite
Indahyanti, R., Bakry, M. I., Furqan, A. C., & Megawati, M. (2024). The Role of Follow-up of Audit Recommendations and Financial Performance on Incumbents Electability in Indonesia. Journal of Applied Accounting, 3(2), 52-59. https://doi.org/10.52158/jaa.v3i2.1031
Section
Articles
Copyright (c) 2024 Rarah Indahyanti, Moh. Iqbal Bakry, Andi Chairil Furqan, Megawati Megawati
This work is licensed under a Creative Commons Attribution 4.0 International License.
