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Accrual Accounting Adoption In Java Municipalities: An Empirical Investigation

Author

Listed:
  • Khoirul Aswar

    (Tunku Puteri Intan Safinaz School of Accountancy, Universiti Utara Malaysia and UPN "Veteran" Jakarta)

  • Siti Zabedah Saidin

    (Tunku Puteri Intan Safinaz School of Accountancy, Universiti Utara Malaysia)

Abstract

Purpose: Beginning from the assumption that accrual accounting is useful in ensuring the high performance of management systems, this article investigates explanatory factors concerning the level of accrual accounting adoption in municipalities on the Indonesia island of Java. Design/methodology/approach: Data collection in this study was based on a structured questionnaire sent to the Head of Accounting Sections of 119 Javanese municipalities. The instrument for content and construct validity and reliability was tested. Then, the hypotheses were tested using Structure Equation Modelling (SEM) by SmartPLS. Findings: The results indicate that the variables of top management support, adequate training programs, and the quality of information technology has a significant effect on the level of accrual accounting adoption and key are factors influencing the level of accrual accounting adoption. They also indicate that organizational culture is an important moderating influence between these variables and the level of accrual accounting adoption. Research limitations/implications: One of the limitations of this study is that data collection using a survey method through a questionnaire likely does not capture the wider knowledge of respondents; in addition, the questionnaires were distributed only to Javanese municipalities. The findings of this study and the limitations inherent in it can lead to some further research opportunities. For example, further research can examine neglected variables such as the size of the organization and its social capital and also the importance of organizational variables such as local political support and support from external auditing processes. Originality/value: To the best of the researcher's knowledge, no study of Indonesian municipalities has tested the impact of factor such as top management support, and organizational culture as a moderating effect on the level of accrual accounting adoption.

Suggested Citation

  • Khoirul Aswar & Siti Zabedah Saidin, 2018. "Accrual Accounting Adoption In Java Municipalities: An Empirical Investigation," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 11(3), pages 24-30, December.
    • Handle: RePEc:tei:journl:v:11:y:2018:i:3:p:24-30
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    References listed on IDEAS

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    Cited by:

    1. Khoirul Aswar, 2019. "Factors on the Accrual Accounting Adoption: Empirical Evidence from Indonesia," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 12(3), pages 36-42, December.
    2. Oktavia Nurlianto & khoirul aswar, 2020. "A Conceptual Framework on the Financial Statement Disclosure in Indonesia Local Government," Journal of Economics and Behavioral Studies, AMH International, vol. 12(3), pages 65-69.
    3. Afifah Muawanah & Ermawati, 2022. "Determinants of Mandatory Disclosure for Local Government Financial Statements," Journal of Economics and Behavioral Studies, AMH International, vol. 14(3), pages 11-19.
    4. Lovina Eka Putri & Khoirul Aswar & Ermawati, 2020. "Performance Measurement of Local Government in Indonesia: A Conceptual Study," Information Management and Business Review, AMH International, vol. 12(1), pages 41-44.
    5. Vania Talitha & Khoirul Aswar, 2021. "Implementation of Accrual-Based Government Accounting Standards in Indonesia: A Review of Organizational Factors," Journal of Economics and Behavioral Studies, AMH International, vol. 13(5), pages 22-31.
    6. Aditya Wira Dianto & Khoirul Aswar, 2020. "Assessing Accrual Accounting Implementation in Cianjur Regency: An Empirical Investigation," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 13(1), pages 7-13, April.
    7. Albertus Theo Jonathan & Khoirul Aswar & Ermawati, 2020. "The Implementation of Accrual Basis Accounting in Indonesian Local Government," Journal of Economics and Behavioral Studies, AMH International, vol. 12(4), pages 67-72.

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    More about this item

    Keywords

    Accrual Accounting; Compliance; Government Regulations; Explanatory Factors;
    All these keywords.

    JEL classification:

    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • M15 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - IT Management
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation
    • M53 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Training

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