Rizkiya Faizatul Aulia, Periansya Periansya, Eka Jumarni Fithri

LINKING ACCOUNTABILITY TO AUDIT DELAY: ROLE OF SIZE AND FINDINGS

Introduction

Linking accountability to audit delay: role of size and findings. Investigate audit delays in Indonesian local governments, exploring the impact of government size, audit findings, and performance accountability. Learn how audit findings significantly influence delays.

Abstract

Audits of local government financial statements in Indonesia are conducted after submission to the supreme audit agency. Based on the 2021–2023 semester audit reports, although submissions were timely, audit delays increased, indicating the presence of other contributing factors. This study investigates the effect of local government size and audit findings on audit delays, with performance accountability as a mediating factor. A quantitative approach was applied using secondary data from 34 provinces during 2021–2023, analyzed through multiple linear regression and path analysis. The results show that local government size positively influences performance accountability, while audit findings negatively affect it. Audit findings are also identified as the only factor significantly influencing audit delays. However, performance accountability does not mediate the relationship between the independent variables and audit delays. Theoretically, this research enriches public sector literature on audit delay by examining the mediating role of performance accountability. Practically, the findings suggest that auditors and local governments can reduce audit delays by strengthening the management and resolution of audit findings.

Review

This study addresses the pertinent issue of audit delays within the Indonesian local government sector, a critical area given the importance of timely financial reporting and accountability. The authors investigate how local government size and the nature of audit findings contribute to these delays, with a particular focus on the mediating role of performance accountability. Employing a quantitative approach with secondary data spanning 34 provinces from 2021 to 2023, the research utilizes multiple linear regression and path analysis. Notably, the study finds that while both local government size and audit findings influence performance accountability, audit findings emerge as the sole significant direct predictor of audit delays. Contrary to expectations, performance accountability does not function as a mediator in this relationship. The paper makes several valuable contributions to the public sector auditing literature. Its exploration of performance accountability as a mediating variable, even if ultimately found not to mediate, represents a novel theoretical step in understanding the complex drivers of audit delay beyond conventional factors. The practical implication is particularly strong, as the finding that audit findings are the primary determinant of delay offers clear, actionable guidance for both auditors and local governments: improving the management and resolution of these findings can directly mitigate delays. Furthermore, the use of comprehensive secondary data from 34 provinces across a recent three-year period lends robustness to the empirical analysis, providing a solid foundation for the conclusions drawn within the Indonesian context. While shedding light on critical aspects of audit delay, the study also presents avenues for further research. The non-mediating role of performance accountability raises questions regarding the specific mechanisms through which accountability might (or might not) impact audit delays, perhaps suggesting a need for alternative conceptualizations or measurements of accountability in this context. Future studies could explore other potential mediators or moderators, such as the quality of internal controls, auditor independence, or the political environment, which might indirectly link the independent variables to audit delay. Additionally, a deeper qualitative investigation into the nature and severity of "audit findings" could provide richer insights into *why* they disproportionately cause delays, potentially informing more targeted intervention strategies. Clarifying the definition and measurement of audit delays (e.g., differentiating between delay in initial submission versus finalization) could also offer a more granular understanding of the problem.

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