Transparency of Local Financial Management: Evidence from Local Governments in Indonesia

Abstract

AbstractThis study aims to provide empirical evidence about the influence of political competition, local independence, level of human development, and Supreme Audit Board (BPK) audit opinion on increasing transparency in local financial management in Indonesia. The research sample consisted of 436 local governments in Indonesia in 2016. The analytical method used to test the hypothesis is multiple linear regression. The results of this study indicate that local independence, level of human development, and BPK audit opinion have been proven to have a positive effect on increasing transparency in local financial management in Indonesia. On the other hand, political competition does not affect increasing transparency in local financial management in Indonesia. The findings contribute as the fundamental idea and recommendation for the government to improve the local financial management transparency in Indonesia. Keywords: Transparency, Local Financial Management, Local Government.