Factors Affecting the Probability of Local Government Financial Statements to Get Unqualified Opinion

Abstract

The Policy of regional autonomy in Indonesia had an impact on the financial accountability of local governance and that led to the issuance of the financial statements of local governments. Based on Law 15 of 2004 the Supreme Audit Agency of BPK is the only which authorized to carry out financial audit of the financial statements of local governments and provide an audit opinion. Unqualified opinion is the best opinion given by BPK on the financial statements of local governments that complied with the Government Accounting Standards and free from material misstatement. This study is aimed to determine factors that affect the probability for local government financial statements to obtain unqualified opinion. Quantitative methods of probit logistic regression is used in this study. It can be seen that the amount of assets, grant expenditures, audit recommendations, and the completion of the audit recommendations followed-up have significant impact on the probability of local government financial statements to obtain unqualified opinion.

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Author Information
Bahrullah Akbar, Indonesia Supreme Audit, Indonesia
Achmad Djazuli, Tazkia University, Indonesia
Bambang Pamungkas, Indonesia Supreme Audit, Indonesia
Moermahadi Soerja Djanegara, Indonesia Supreme Audit, Indonesia
Sri Mulyan, Indonesia Supreme Audit, Indonesia

• Category: Dubai Conference Series 2016, IICSSDubai2016, Oral Presentation, Paper Available
• Tag: Economics and Management,

Posted by James Alexander Gordon

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