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Factors on the Accrual Accounting Adoption: Empirical Evidence from Indonesia

Author

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  • Khoirul Aswar

    (Universitas Pembangunan Nasional Veteran Jakarta, Jl RS Fatmawati No: 1, Jakarta Selatan, Indonesia)

Abstract

Purpose: This study aims to examine the relationship between top management support, implementation costs, and effective project leader and the level of accrual accounting adoption in Indonesia's municipalities. Design/methodology/approach: The hypotheses of the study were tested using the survey data from 220 municipalites in Indonesia. The instrument for content and construct validity and reliability was tested. Then, the hypotheses were tested using Structure Equation Modelling (SEM) by SmartPLS. Finding: This study found that, top management support and implementation cost have significant relationship with the level of accrual accounting adoption. Meanwhile, effective project leader has no significant relationship with the level of accrual accounting adoption. Research limitations/implications: This study contributions to provide input into the adoption of Government Regulation No. 71 of 2010 in order to apply the rule of accrual accounting to the fullest, and to minimize errors in financial reporting with the identification of possible obstacles faced in implementing accrual accounting. This study recommended that, more factors such as human resources, external audit are needed to complement and improve financial reporting with accrual accounting adoption. 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, implementation cost, and effective project leader on the level of accrual accounting adoption.

Suggested Citation

  • Khoirul Aswar, 2019. "Factors on the Accrual Accounting Adoption: Empirical Evidence from Indonesia," International Journal of Business and Economic Sciences Applied Research (IJBESAR), International Hellenic University (IHU), Kavala Campus, Greece (formerly Eastern Macedonia and Thrace Institute of Technology - EMaTTech), vol. 12(3), pages 36-42, December.
    • Handle: RePEc:tei:journl:v:12:y:2019:i:3:p:36-42
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    References listed on IDEAS

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    7. 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), International Hellenic University (IHU), Kavala Campus, Greece (formerly Eastern Macedonia and Thrace Institute of Technology - EMaTTech), vol. 11(3), pages 24-30, December.
    8. Eriotis, Nikolaos & Stamatiadis, Filippos & Vasiliou, Dimitrios, 2011. "Assessing Accrual Accounting Reform in Greek Public Hospitals: An Empirical Investigation," MPRA Paper 30246, University Library of Munich, Germany.
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    Cited by:

    1. 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.
    2. 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.
    3. Khoirul Aswar & Lovina Eka Putri & Ermawati, 2020. "The Effect of Organizational Factors on Performance Measurement in Indonesia Local Governments," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(4), pages 122-131.
    4. 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 Adoption; Government Regulation; Factors; Indonesia;
    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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