Implementation of accrual accounting by the Indonesian central government: An investigation of social factors

  • Received October 3, 2021;
    Accepted November 12, 2021;
    Published November 23, 2021
  • Author(s)
  • DOI
  • Article Info
    Volume 10 2021, Issue #1, pp. 151-163
  • Cited by
    3 articles

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This work is licensed under a Creative Commons Attribution 4.0 International License

Public sector accounting reforms have resulted in crucial changes in accounting reporting by the government, namely the adoption of accrual accounting in the public sector. This study looks into the social factors that led to the Indonesian central government implementing accrual accounting reform. This study adopted a quantitative approach using purposive sampling. Structural Equation Modeling (SEM) with PLS version 3.0 was used to analyze the data. The information for this study was gathered using a Google Form, which was used to send 70 questionnaires to government finance officials, chief accountants and auditors, and heads of accounting and auditing divisions in the Ministry of Finance. Seeing these social factors is expected to increase the effectiveness of the administration of accrual accounting implementation. The results showed that pressure from donors, pressure from the National Board of Accountants and Auditors (NBAA), political will, and audit process had an impact on the effectiveness of accrual accounting application (AAA). However, management change, regulatory matters, and a culture of transparency have no effect. In addition, the effective administration of AAA affects managerial accountability. This study implies that the effective application of accrual accounting depends on human-related concerns and culture. It is important to note that accrual accounting is more of a management reform that entails changes to bigger areas of institutional and accountability systems than merely adopting a new accounting technology.

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    • Table 1. Descriptive statistics of respondents
    • Table 2. Descriptive statistics of data
    • Table 3. Convergent reliability and validity
    • Table 4. PLS path algorithm testing and bootstrapping
    • Conceptualization
      Khoirul Aswar, Ermawati Ermawati
    • Data curation
      Khoirul Aswar, Ermawati Ermawati, Wisnu Julianto
    • Resources
      Khoirul Aswar
    • Software
      Khoirul Aswar, Ermawati Ermawati
    • Writing – original draft
      Khoirul Aswar
    • Writing – review & editing
      Khoirul Aswar, Ermawati Ermawati
    • Formal Analysis
      Ermawati Ermawati
    • Methodology
      Ermawati Ermawati, Wisnu Julianto
    • Supervision
      Ermawati Ermawati
    • Validation
      Ermawati Ermawati, Wisnu Julianto
    • Investigation
      Wisnu Julianto