Effect of SAP Application on the Quality of Financial Statements

Oct 13, 2025 by wbrum.org 37 views

The Effect of Application of Government Accounting Standards, Quality of Government Apparatus, and Implementation of Fixed Assets on the Quality of Financial Statements in the Langkat Regency Government

Introduction

The quality of financial statements is a crucial aspect of government accounting, as it reflects the financial position and performance of a government agency. In the Langkat Regency Government, the quality of financial statements is essential for ensuring transparency, accountability, and good governance. This study aims to examine the effect of the application of Government Accounting Standards (SAP), the quality of government officials, and the implementation of fixed assets on the quality of financial statements in the Langkat Regency Government. Additionally, this study aims to identify the dominant variables that affect the quality of financial statements and examine the role of internal control as moderation variables.

Background

The Langkat Regency Government is one of the local governments in Indonesia that has been implementing government accounting standards (SAP) to improve the quality of financial statements. However, the quality of financial statements in the Langkat Regency Government is still a concern, as it is often criticized for being inaccurate, incomplete, and unreliable. The quality of government officials and the implementation of fixed assets are also critical factors that affect the quality of financial statements. Therefore, this study aims to investigate the effect of these factors on the quality of financial statements in the Langkat Regency Government.

Research Methodology

This study uses a quantitative approach with a survey method. The research population includes all staff/employees in the Langkat Regency Regional Work Unit (SKPD). Primary data is collected through questionnaires distributed to respondents. The questionnaire consists of two parts: the first part asks about the demographic characteristics of the respondents, while the second part asks about the application of SAP, the quality of government officials, the implementation of fixed assets, and the quality of financial statements.

Research Results

The results of this study show that the application of SAP, the quality of government officials, and the implementation of fixed assets have a significant influence on the quality of financial statements in the Langkat Regency SKPD. Partially, the application of SAP and the quality of government officials have a significant effect on the quality of financial statements. However, internal control is not proven significant in moderating the relationship between the application of SAP, the quality of government officials, and the implementation of fixed assets and the quality of financial statements.

Analysis and Discussion

Effect of SAP Application on the Quality of Financial Statements

The implementation of a consistent and effective SAP plays an important role in improving the quality of financial statements. SAP provides a structured framework and clear standard for recognition, measurement, and reporting of financial transactions. This allows financial statements to be more accurate, relevant, and reliable. The application of SAP in the Langkat Regency Government has been implemented since 2015, and it has been reported that the quality of financial statements has improved significantly.

Effect of Quality Apparatus on the Quality of Financial Statements

High-quality apparatus, including competence, integrity, and dedication, greatly affects the quality of financial statements. Competent apparatus and high integrity will be able to apply SAP well and produce accurate financial reports. The quality of government officials in the Langkat Regency Government has been reported to be good, with many officials having a high level of competence and integrity.

Effect of Implementation of Fixed Assets on the Quality of Financial Statements

Implementation of appropriate fixed assets, including identification, recording, and accurate reporting, is very important in improving the quality of financial statements. Fixed assets are tangible assets that have economic value and long economic age. Good fixed asset management will ensure that the financial statements reflect the actual condition of the asset. The implementation of fixed assets in the Langkat Regency Government has been reported to be good, with many fixed assets being properly identified, recorded, and reported.

The Role of Internal Control

The results of this study show that internal control was not proven significant in moderating the relationship between independent variables and dependent variables. This shows that although internal control is important, other factors such as the application of SAP, the quality of government officials, and the implementation of fixed assets have a greater influence on the quality of financial statements.

Recommendation

Based on the results of this study, the following recommendations can be submitted:

*** Improving the Quality of the Apparatus: *** The Langkat Regency Government needs to focus on the training program and development of the Apparatus Competency, especially in the field of accounting and financial management.

*** Implementing SAP Consistently: *** Intensive socialization and training need to be carried out to all apparatus on the application of effective and efficient SAP.

**Improving the Management of Fixed Assets: *** Repairing the fixed asset management system and adequate procurement of resources can increase the accuracy of fixed asset data and quality of financial statements.

*** Strengthening Internal Control: *** Although it does not have a significant influence in this study, internal control is still important to minimize the risk of error and abuse in financial management.

This research is expected to be a reference for the Langkat Regency Government in improving the quality of financial statements and accountability in regional financial management.

Conclusion

This study aims to examine the effect of the application of Government Accounting Standards (SAP), the quality of government officials, and the implementation of fixed assets on the quality of financial statements in the Langkat Regency Government. The results of this study show that the application of SAP, the quality of government officials, and the implementation of fixed assets have a significant influence on the quality of financial statements. Partially, the application of SAP and the quality of government officials have a significant effect on the quality of financial statements. However, internal control is not proven significant in moderating the relationship between the application of SAP, the quality of government officials, and the implementation of fixed assets and the quality of financial statements. This study provides a reference for the Langkat Regency Government in improving the quality of financial statements and accountability in regional financial management.

Limitation

This study has several limitations. Firstly, the study only focuses on the Langkat Regency Government, and the results may not be generalizable to other local governments. Secondly, the study only examines the effect of SAP, the quality of government officials, and the implementation of fixed assets on the quality of financial statements, and does not examine other factors that may affect the quality of financial statements. Finally, the study only uses a survey method, and the results may be affected by the limitations of this method.

Future Research

This study provides a reference for future research on the quality of financial statements in local governments. Future research can examine the effect of other factors on the quality of financial statements, such as the quality of internal control, the quality of audit, and the quality of financial reporting. Future research can also examine the effect of SAP, the quality of government officials, and the implementation of fixed assets on the quality of financial statements in other local governments.

References

Government of Indonesia. (2015). Government Accounting Standards (SAP).
Langkat Regency Government. (2015). Financial Report of Langkat Regency Government.
World Bank. (2015). Public Financial Management in Indonesia.
International Federation of Accountants. (2015). International Public Sector Accounting Standards (IPSAS).

Appendix

Questionnaire used in this study.
Data analysis procedures used in this study.
Results of the data analysis.
Frequently Asked Questions (FAQs) about the Effect of Application of Government Accounting Standards, Quality of Government Apparatus, and Implementation of Fixed Assets on the Quality of Financial Statements in the Langkat Regency Government

Q: What is the purpose of this study?

A: The purpose of this study is to examine the effect of the application of Government Accounting Standards (SAP), the quality of government officials, and the implementation of fixed assets on the quality of financial statements in the Langkat Regency Government.

Q: What are the research questions of this study?

A: The research questions of this study are:

What is the effect of the application of SAP on the quality of financial statements in the Langkat Regency Government?
What is the effect of the quality of government officials on the quality of financial statements in the Langkat Regency Government?
What is the effect of the implementation of fixed assets on the quality of financial statements in the Langkat Regency Government?
What is the role of internal control in moderating the relationship between the application of SAP, the quality of government officials, and the implementation of fixed assets and the quality of financial statements?

Q: What is the methodology used in this study?

A: The methodology used in this study is a quantitative approach with a survey method. The research population includes all staff/employees in the Langkat Regency Regional Work Unit (SKPD). Primary data is collected through questionnaires distributed to respondents.

Q: What are the findings of this study?

A: The findings of this study show that the application of SAP, the quality of government officials, and the implementation of fixed assets have a significant influence on the quality of financial statements in the Langkat Regency SKPD. Partially, the application of SAP and the quality of government officials have a significant effect on the quality of financial statements. However, internal control is not proven significant in moderating the relationship between the application of SAP, the quality of government officials, and the implementation of fixed assets and the quality of financial statements.

Q: What are the implications of this study?

A: The implications of this study are:

The Langkat Regency Government needs to focus on improving the quality of government officials, especially in the field of accounting and financial management.
The Langkat Regency Government needs to implement SAP consistently and effectively.
The Langkat Regency Government needs to improve the management of fixed assets, including identification, recording, and accurate reporting.
The Langkat Regency Government needs to strengthen internal control to minimize the risk of error and abuse in financial management.

Q: What are the limitations of this study?

A: The limitations of this study are:

The study only focuses on the Langkat Regency Government, and the results may not be generalizable to other local governments.
The study only examines the effect of SAP, the quality of government officials, and the implementation of fixed assets on the quality of financial statements, and does not examine other factors that may affect the quality of financial statements.
The study only uses a survey method, and the results may be affected by the limitations of this method.

Q: What are the recommendations of this study?

A: The recommendations of this study are:

The Langkat Regency Government needs to focus on improving the quality of government officials, especially in the field of accounting and financial management.
The Langkat Regency Government needs to implement SAP consistently and effectively.
The Langkat Regency Government needs to improve the management of fixed assets, including identification, recording, and accurate reporting.
The Langkat Regency Government needs to strengthen internal control to minimize the risk of error and abuse in financial management.

Q: What are the future research directions of this study?

A: The future research directions of this study are:

Examining the effect of other factors on the quality of financial statements, such as the quality of internal control, the quality of audit, and the quality of financial reporting.
Examining the effect of SAP, the quality of government officials, and the implementation of fixed assets on the quality of financial statements in other local governments.
Developing a model to predict the quality of financial statements based on the application of SAP, the quality of government officials, and the implementation of fixed assets.

Q: What are the practical implications of this study?

A: The practical implications of this study are:

The Langkat Regency Government can use the findings of this study to improve the quality of financial statements and accountability in regional financial management.
The Langkat Regency Government can use the recommendations of this study to improve the quality of government officials, implement SAP consistently and effectively, improve the management of fixed assets, and strengthen internal control.
The Langkat Regency Government can use the findings of this study to develop a model to predict the quality of financial statements based on the application of SAP, the quality of government officials, and the implementation of fixed assets.