Issue #3 (Volume 14 2025)

Type of the article: Research Article

Abstract
This study aims to examine the interrelation between public budgeting transparency, public participation, government regulation, local government financial capacity, and public trust in shaping local government accountability in heritage asset management. The study focuses on West Sumatra, Indonesia, where local governments play a crucial role in preserving cultural heritage assets. The sample included 250 local government employees actively engaged in heritage asset management. Data were collected using a structured questionnaire between March and June 2024, with responses analyzed using WarpPLS. The study rigorously adheres to ethical principles to protect the participants and ensure the integrity of the research process. Results indicate that public budgeting transparency (β = 0.165, p = 0.003) and local government financial capacity (β = 0.143, p = 0.004) both directly and indirectly, via mediating public trust, influence local government accountability (β = 0.193, p = 0.003). Government regulation (β = –0.012, p = 0.433) was not found to have any direct significant impact on accountability. On the other hand, public trust and government regulatory systems have a strong direct relationship with local government accountability but a weak indirect relationship through public trust, which makes governance mechanisms pretty complex. Public trust plays a vital role in connecting transparency, financial resilience, and accountability to the legitimacy of enforcement and effective governance. The findings underscore the significance of integrating trust-building measures, transparency, and financial capacity for governance frameworks to ensure equitable and sustainable heritage asset management.

Type of the article: Research Article

Abstract
This paper investigates the determinants of local public investment in Morocco, a country undergoing decentralization and facing persistent regional disparities. The study aims to identify the key factors driving capital expenditure across Morocco’s 12 regions and their local governments, including regional, provincial, and municipal councils, from 2017 to 2024. A dynamic panel of 96 observations is constructed, and a generalized method of moments (GMM) estimator is applied to address endogeneity, control for regional fixed effects, and account for the temporal persistence of investment. The choice of GMM is supported by prior descriptive analysis and the absence of spatial autocorrelation, confirmed by Moran’s I test. The results show that financial resources play a central role in shaping regional investment levels. Specifically, both own-source revenues and central government transfers have a positive and statistically significant effect on investment, with elasticities of 0.43 and 1.35, respectively. Public debt also contributes positively (0.21%), suggesting its potential as a complementary financing tool. In contrast, personnel expenditure exerts a crowding-out effect (−0.48%), reducing the fiscal space available for investment. Other operating expenditures and regional population show no significant impact. The model is robust (R² = 0.757) and satisfies the Hansen test (p = 0.095). Overall, the findings highlight the decisive role of financial autonomy and the effectiveness of intergovernmental transfers in enhancing the investment capacity of local governments. The results also call for better management of operating expenses to avoid limiting capital investment potential.

Type of the article: Research Article

Abstract
This study aims to examine the effect of budgetary participation, organizational commitment, motivation, and budget transparency on local government performance, with psychological capital as a moderating variable. Budgetary participation refers to the involvement of local government employees in the budgeting process, while psychological capital reflects their optimism, resilience, and confidence in decision-making. This analysis was conducted in Central Java, Indonesia, from June to August 2024 using a quantitative approach. A structured survey was conducted by distributing questionnaires to respondents consisting of 250 employees in local work units involved in financial management, policy implementation, and service provision. After being selected based on their professional knowledge and direct involvement in the governance and budgeting process, 221 respondents were considered valid. Strict ethical guidelines were adhered to in order to protect participants and maintain the integrity of the research process. The results show that budget transparency and motivation significantly improve government performance. Thus, both are important in the governance process. Psychological capital strengthens the influence of budgetary participation, organizational commitment, and budget transparency on local government performance. Motivation has a direct and substantial contribution to local government performance without being moderated by employee psychological traits such as optimism and self-confidence. Employees' motivation drives their performance regardless of their psychological capital. This is in contrast to budgetary participation and organizational commitment, which require psychological support to enhance their effects. This study contributes to governance research in highlighting the psychological aspects of budgetary participation, organizational commitment, and transparency.

Type of the article: Research Article

Abstract
This study examines the impact of budget planning, participation, and internal control on preventing fraud in the budget and testing the mediating role of effective budgetary policy. A quantitative research approach was carried out in which a structured survey was administered to 178 heads of work units in local government agencies of 14 districts in East Java Province, Indonesia. These respondents were purposively sampled, considering their active role in the budget preparation, to enhance data relevance and reliability. The data collection period was from February to March 2025. The study adheres to rigorous ethical standards to protect human participants and the integrity of the research process. The study found that budget participation is the most significant variable for fraud prevention (β = .747, p < 0.001), followed by budget planning (β = 0.147, p = .017). Internal control and budget policy had no direct effect on fraud prevention. Notably, budget policy had a significant mediation effect between each predictor and fraud prevention, particularly for budget planning (indirect effect β = .352, p < 0.001). The results indicate that fraud prevention can best occur using participatory practices and planning that are contained within a strong, enforceable budgetary policy. It is suggested that there should be institutionalized budget systems with integrated governance systems to facilitate financial integrity.

Type of the article: Research Article

Abstract
The study provides a comprehensive quantitative evaluation of municipal budget allocation efficiency in Portugal over the period 2018–2022, based on a comparative and longitudinal analysis of financial data from 308 municipalities. Efficiency was assessed by examining the alignment between budget forecasts and actual financial execution. The results show that 77.6% of municipalities (n = 239) were classified as efficient in 2018, increasing to 82.1% (n = 253) in 2019 and 83.1% (n = 256) in 2020. However, a downward trend followed, with efficiency declining to 74.0% (n = 228) in 2021 and 73.7% (n = 227) in 2022. Over the five-year period, the average efficiency rate across all municipalities was 78.1%. In contrast, 21.9% of municipalities on average (ranging from 16.9% to 26.3%) consistently demonstrated inefficiencies in budget preparation and execution. The study identifies key contributing factors to inefficiency, including political interference, reliance on incremental budgeting approaches, and limited technical forecasting capacity. The data reveal persistent discrepancies between budgeted allocations and actual service demand, leading to resource misallocation and reduced fiscal credibility. Statistical patterns also indicate that municipalities with higher population densities and more diversified revenue sources tended to perform better in efficiency metrics. The findings support the conclusion that the adoption of rigorous, data-driven forecasting methodologies significantly improves financial planning outcomes and institutional trust. These results offer evidence-based recommendations for refining municipal financial management practices, particularly in settings subject to political and economic volatility.

Acknowledgment
This article is financed by Instituto Politécnico de Setúbal [Polytechnic Institute of Setúbal].