CONFERENCE PROCEEDINGS Malaysia Indonesia International Conference on Economics, Management and

Accounting (MIICEMA) 2016

Hosted by Faculty of Economics and Business, University of Jambi

24 – 25 October 2016

The Strategy For Improving Competitiveness to win

the ASEAN Economic Community (AEC)

Conference Proceedings

Conference ProceedingsMalaysia Indonesia International Conference on Economics, Management and Accounting

(MIICEMA) 2016

The Strategy For Improving Competitiveness to win the ASEANEconomic Community (AEC)

Editors:Dr. Junaidi, SE, M.Si

Prof. Dr. Johannes, SE, MSDr. Syahmardi Yacob, SE, MBADr. Tona Aurora Lubis, SE, MS

Dr. Sri Rahayu, SE, M.Si, Ak, CA

Faculty of Economics and Business, University of Jambi

Conference ProceedingsMalaysia Indonesia International Conference on Economics, Management and Accounting(MIICEMA) 2016

The Strategy For Improving Competitiveness to win the ASEAN Economic Community(AEC)

ISBN: 978-602-98081-4-8

EditorsDr. Junaidi, SE, M.SiProf. Dr. Johannes, SE, MSDr. Syahmardi Yacob, SE, MBADr. Tona Aurora Lubis, SE, MSDr. Sri Rahayu, SE, M.Si, Ak, CA

Cover design and LayoutJunaidi

PublisherFaculty of Economics and Business, University of JambiJalan Raya Jambi-Ma.Bulian KM.15 Kampus Mendalo Darat, Jambi, IndonesiaTelp. 0741-583317

First Published, December 2016

All right reserved. No part of this publication may be reproduced, stored in a retrieval system, ortransmitted in any form or by any means, electronic, mechanical, photocopying, recording orotherwise without the prior permission of the publisher

CONFERENCE COMMITEE

Patron

Prof. Johny Najwan, SH, MH. Ph.D

Drs. Amril, ME

Advisor

Prof. Dr. H. Syamsurijal Tan, SE, MA

Prof. Dr. H. Amri Amir, SE,M.Si

Prof. Dr. Drs. H. Aulia Tasman, M.Sc

Prof. Dr. H.M. Rachmad R, SE, M.Si

Zulkfili, SE,MS

Organising Commitee

Dr. Junaidi, SE, M.Si (Chairperson)

Radja Syarah Patricia, SE, M.Sc (Secretary)

Reka Maiyarni, SE, M.Si. Ak (Secretariat)

Dr. Johannes, SE, M.Si

Drs. H. Edward, MM

Dr. Syahmardi Yacob, SE, MBA

Dr. Shopia Amin, SE, M.Si

Dr. Syahmardi Yacob, SE, MBA

Dr. Tona Aurora Lubis, SE, M.Si

Dr. Sri Rahayu, SE, M.Si, Ak, CA

Dr. Haryadi, SE, MMS

Dr. Ilham Wahyudi, SE, M.Si

Dr. Arman Delis, SE, ME

Dr. Hj. Zulfanetti, SE, M.Si

Dr. Asep Machpuddin, SE, MM

Dr. H. Zamzami, SE, M.Si

Dr. Syaparuddin, SE, M.Si

Dr. Syafri, SE, M.Si

Dr. H. Afrizal, SE, M.Si, Ak.CA

Dr. H. Mukhzarudfa, SE, M.Si

Dr. Syafri, SE, M.Si

Drs. Yulmardi, MS

Mohammad Ichsan, SE, M.Si

Wirmie Eka Putra, SE, M.Si

Etik Umiyati, SE, M.Si

Ade Titi Nifita, SE, MM

Erni Achmad, SE, M.Si

Parmadi, SE, ME

Siti Hodijah, SE, M.Si

Dwi Kurniawan, SE, M.Si

Drs. Jefri Marzal, M.Sc, P.Hd

Dearmi Artis, SE, M.Sc

Drs. H. Mulyadi Raf, MBS

Drs. H. Agus Syarif, MBS

Paulina Lubis, SE, M.EI

Dra. Erida, M.Si

Dra. Sumarni, MM

Drs. H. Purwaka Hari Prihanto, M.Si

Eddy Firza, SE, M.Acc, Ak

Eko Prasetyo, SE, M.Sc. Ak.CA

Kamadie Sumanda Syafis, SE, M.Acc, Ak.CA

Johannes Vyn Amzar, SE, M.Sc

Liona Efrina, SE

Nur Budi Utama, SE, MM

Farida, SE

Ahmed Riza Fahlevi, SH

Singki Oktaviani, SE

Drs. H. Hendri Leonardo

Nurlia Eriska Riyanda Guntari, SP

Azlia Daratulaila Syam, SE

Raden Nazaruddin

Syapriadi

Jatmiko Budi Santoso

Secretariat: Faculty of Economics and Business, University of Jambi, Kampus Mendalo Darat, Jambi, Indonesia

Telp. 0741-583317 e-mail: miicema2016@unja.ac.id

i

FOREWORD

The Malaysia Indonesia International Conference on Economics, Management and Accounting

(MIICEMA) is an annual international conference that gathers academics and practitioners from

Malaysia, Indonesia and around the World to facilitate the presentation and sharing of research findings

particularly in the areas of economics and management.

Numerous benefits have been achieved from the sharing of knowledge and building of working

relationships through presentations of working papers after the organisation of 16 series of the

conference. The conference has become an important platform for academics to share information

regarding current issues and new economic and business challenges prevalent in both South East Asia and

globally.

As a continuation of the memorandum of understanding between Universiti Kebangsaan Malaysia,

Universitas Syiah Kuala, Institut Pertanian Bogor, Universitas Muhammadiyah Surakarta and Universitas

Bengkulu as the founding institutions of MIICEMA, 2016 is witnessing once again the organising of the

17th MIICEMA. Following the tradition of the long-established friendship, the honour of becoming the

main organiser and host to the 17th MIICEMA has now been transferred to University of Jambi, Jambi

through the Faculty of Economics and Business.

Through the organising of the conference, the research findings that will be presented by

academics in various fields such as economics, management and accounting will surely become guides

and models for other academics in developing the branches of knowledge and for the industry in

managing and strengthening their businesses.

The chosen theme for this year MIICEMA is ” The Strategy For Improving Competitiveness to

win the ASEAN Economic Community (AEC) ″. Global economic climate has been undergoing shocks

that adversely affecting government and business organisations. The economic turmoil has been

considered by few as the worst in the century that prudent and solid business strategies must make

accurate market interpretation of both opportunities and constraints. With this in mind, the 17th

MIICEMA aims to provide a platform for both academicians and practitioners to sit together and

elaborate on these challenges.

The goals and objectives of this international conference are as follows:

to become a platform for academics in the South East Asia to share latest research findings on

economic, management and accounting issues.

to identify emerging economic and business challenges prevalent in South East Asia and around the

world amidst the 2016 economic turmoil.

to gather input on new opportunities in the domain of business within the contexts of South East Asia

and global amidst the 2016 economic turmoil.

to sustain research collaborations that produce high impact outputs.

to elevate the status of MIICEMA member institutions through presentation of internationally-

recognised research results.

Following the phenomenal successes of the previous conferences, MIICEMA will be proudly

brought to you again this October by University of Jambi, Jambi, Indonesia. This year MIICEMA will be

organised in conjunction with the Seminar and Annual Meeting of the Western Division of Economics

Institutions Cooperation. This is an annual event involving 27 state universities and several private

universities that offer Economics programmes in Indonesia. In 2016, the Western Division of Economics

Institutions Cooperation meeting will be hosted by the Faculty of Economics and Business, University of

Jambi, Jambi, which will also serve as the main organizer of MIICEMA 2016.

This year MIICEMA highlights the current issue facing economies in the region thorugh a theme

of ” The Strategy For Improving Competitiveness to win the ASEAN Economic Community (AEC) ″.

This theme is to be supported with few key tracks; Microeconomics, Macroeconomics, Monetary

Economics, Public Economics, Regional and Urban Economics, International Economics, Natural

Resource Economics, Industrial Economics, Labor Economics, Development Studies, Business,

Management and Organization, Marketing, Finance, Human Resources, Financial Accounting,

Managerial and Behavioral Accounting, Auditing, Accounting Information Systems, Public Sector

Accounting, Social and Environmental Accounting, Islamic Economics, and other related areas.

This collection doest not include the totality of the papers presented at the conference, as not all

contributors submitted their written papers for publication.

Dr. Junaidi, SE, M.Si

Conference Chair

ii

WELCOMING SPEECH

DEAN OF THE FACULTY OF ECONOMICS AND BUSINESS

UNIVERSITY OF JAMBI

I would like to welcome all participants to the 17th Malaysia Indonesia International Conference on

Economics, Management and Accounting (MIICEMA) in Jambi, Indonesia. It is truly an honor and a

privilege for Faculty of Economics and Business, University of Jambi to host this International

conference.

I have no doubt in my mind, that this conference will be a worthwhile experience. We have an

opportunity to learn each other from some of the best experts in different decipline. Hence I hope after

the conference finished, we are enriched with a better understanding of contemporary issues in

economics and business in South East Asia. Furhtermore, as the member of MIICEMA, we can enrich

the network for some important aspects such as publication a student exchange.

I would like to express our sincere gratitude and appreciation to many individuals for their invaluable

input to make succes this conference. I would also like to extend a special thank you to our Institutions’

partners for their support to organize this event successfully.

So, I wish you have a pleasant International Conference and enjoy your stay in Jambi.

Drs. H. Amril, ME

Dean of the Faculty of Economics and Business

University of Jambi

iii

WELCOMING SPEECH RECTOR OF UNIVERSITY OF JAMBI

I extend my warm welcome to all of the distinguished speakers and participants of the 17th Malaysia

Indonesia International Conference on Economics, Management and Accounting (MIICEMA) which held

by Faculty of Economics and Business, in October 24-25, 2016.

As a Rector of University of Jambi, I am pleased to witness the 17th MIICEMA, it provides a unique

opportunity for scholars, experts, researchers, to assemble and share ideas on critical issues and trends in

economics and business. Furthermore, I hope this conference could develop the valuable network and

international collaboration amongst universities in Indonesia and Malaysia, as well as to facilitate

publications of research by Indonesia and Malaysia scholars in international journal.

I congratulate the Dean of Economics and Business, the chairman of the conference, all the renowned

speakers and delegates for their participation that makes this conference possible. I welcome you all to

University of Jambi.

As a part of the provincial cultural promotion, we hope you enjoy the entire traditional and unique

cultural atmosphere. I urge you also to enjoy the beautiful of Muaro Jambi temple and Gentala Arsy

Bridge. Muaro Jambi Temple as it has been revealed is the place of Buddhism taught not only for the

ancient of Indonesian but for South Asia Countries.

Last but not least, we thank you to every person both that comes from internal and external organization

who makes this conference conducted. Finally, I hope God bless you all as long as you follow the

conference.

Prof. H. Johni Najwan, SH, MH, Ph.D

Rector of University of Jambi

iv

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v

CONTENTS

FOREWORD ................................................................................................................................................ i

WELCOMING SPEECH DEAN OF THE FACULTY OF ECONOMICS AND BUSINESSUNIVERSITY OF JAMBI ........................................................................................................................... ii

WELCOMING SPEECH RECTOR OF UNIVERSITY OF JAMBI ..........................................................iii

CONTENTS ................................................................................................................................................. v

MANAGEMENT

MAPPING A TRUE SUPPLY NETWORK STRUCTURE: AN IMPLICATION TO THEPRACTICE OF SUPPLY CHAIN MANAGEMENT.................................................................................. 3

Lokhman Hakim Osmana; *Azhar Ahmad ......................................................................................... 3

ATTRIBUTION THEORY PERSPECTIVE TO OBSERVE THE IMPACT OF CULTURETOWARD SERVICE FAILURE: IT’S IMPLICATION ON SERVICE INDUSTRY.............................. 21

Lizar Alfansi; Effed Darta Hadi; Ferry Tema Atmaja ...................................................................... 21

THE CHARACTERISTICS OF THE ENTREPRENEUR AND THE DESIRE TO BECOMEENTREPRENEURS AMONG UNDERGRADUATE STUDENTS ......................................................... 29

Ahmad Mardalis; Imron Rosyadi..................................................................................................... 29

THE EFFECT OF BRAND ASSOCIATIONS TOWARD BRAND EQUITY AND BRANDLOYALTY AS INTERVENING VARIABLE OF HONDA MOTORCYCLE IN JAMBI CITY ............ 37

Anaseputri Jamira*, Ade Oktavia**, Junaidi***.............................................................................. 37

EFFECT OF REWARD MANAGEMENT ON JOB SATISFACTION.................................................... 45Azman Ismail1, AnisAnisah Abdullah2, NurIzzaty Mohamad3......................................................... 45

ANTECEDENTS OF TOURIST SATISFACTION AND ITS IMPACT ON LOYALTY TO APARTICULAR DESTINATION ............................................................................................................... 51

Effed Darta Hadi, Fachri Eka Saputra .............................................................................................. 51

MONETARY POLICY AND MACROECONOMIC RESPONSES: SVAR STUDY OFEGYPT ....................................................................................................................................................... 59

Mohamed AseelShokr; Zulkefly Abdul Karim; Mohd. Azlan Shah Zaidi ....................................... 59

THE STRATEGY FOR IMPROVING COMPETITIVENESS TO WIN THE ASEANECONOMIC COMMUNITY (AEC) USING THE ECONOMIC LANDSCAPE (CASE STUDYOF JAMBI PROVINCE)............................................................................................................................ 73

Budi Kurniawan1, Susiawati Kristiarini2........................................................................................... 73

E-RETAILING: CONSUMER MOTIVATION TO SHOP IN INDONESIA AND THAILAND ............ 79Seprianti Eka Putri ............................................................................................................................ 79

STRATEGY MODEL OF OPTIMAZING FOR MINIMARKET RETAIL BUSINESSPERFORMANCE: STUDY IN JAKARTA AND BANDUNG, INDONESIA ......................................... 95

Syahmardi Yacob*, Sucherly**, Diana Sari**, AsepMulyana**..................................................... 95

RURAL INDUSTRIAL MANAGEMENT: THE IMPLEMENTATION OF SIMPLE-BASEDTECHNOLOGY IN SUPPORTING THE ECONOMIC RESILIENCE AS PERCEIVEDBENEFITS ............................................................................................................................................... 101

Slamet Widodo, Effed Darta Hadi, M Abduh, Berto Usman.......................................................... 101

FACTORS INFLUENCING INTERNET USAGE AMONG WOMEN ENTREPRENEURS ............... 113Muhaini I.; Azhar Ahmad .............................................................................................................. 113

THE SHARIA BANKING PERFORMANCE BASED ON ISLAMIC INDICES IN THEASEAN COUNTRIES.............................................................................................................................. 121

Wiyadi1, Sayekti Endah Retno Meilani 2, Rina Trisnawati3, Wahyu Pramesti4 .............................. 121

vi

PERFORMANCE OF ISLAMIC INDICES: RISK ADJUSTED RETURNS OF SHARIACOMPLIANT STOCKS (STUDY ON JAKARTA ISLAMIC INDEX AND DOW JONESISLAMIC TURKEY FOR THE YEARS 2010-2014) ............................................................................. 129

Ade Banani, MMS1 ; Nur Afni Hidayatun2 ................................................................................... 129

HOW SPOUSAL SUPPORT AND WORK-FAMILY BALANCE CAN INFLUENCE TOCAREER SUCCESS? .............................................................................................................................. 141

Shofia Amin.................................................................................................................................... 141

KNOWLEDGE MANAGEMENT, STRATEGIC THINKING AND SUSTAINABLECOMPETITIVE ADVANTAGE IN SMALL ECONOMIC ENTERPRISE BATIK BASUREKINDUSTRY AT BENGKULU CITY ...................................................................................................... 149

Praningrum; Muhartini Salim ......................................................................................................... 149

UNDERSTANDING HOW SMEs CREATIVE INDUSTRIES CAN IMPROVE INNOVATIONPERFORMANCE .................................................................................................................................... 157

Fachri Eka Saputra, Sularsih Anggarawati, Ferry Tema Atmaja, ................................................... 157

THE ROLE OF STRATEGIC IMPLEMENTATION OF CORPORATE SOCIALRESPONSBILITY AS SUSTAINABLE DEVELOPTMENT STRATEGIC CONSIDERATIONFOR BASIC SITUATION MANAGEMEN DECISIONS MAKING IN BUSINESSCOMPETITION ASEAN ECONOMIC COMMUNITY (AEC) (A QUALITATIVE STUDYAT PAMOR GANDA CRUMB RUBBER LTD) .................................................................................... 165

Nila Aprila, Fenny Marietza, Riski Rian Nainggolan................................................................... 165

CAN BALANCED SCORECARD BE APPLIED TO ANALYZE THE MISSIONS OF LOCALGOVERNMENT? DOUBLE CASES OF INDONESIAN LOCAL GOVERNMENT MISSIONS ........ 177

Agung Riyardi*; Sri Wahjuni**; Latifah***; Widojono***.......................................................... 177

PERCEPTION ON JUSTICE, TRUST AND TAX COMPLIANCE BEHAVIOUR INMALAYSIA ............................................................................................................................................. 187

Sellywati Mohd Faizal*,Mohd Rizal Palil, Ruhanita Maelah, Rosiati Ramli**............................. 187

STRATEGIES FOR INCREASING THE COMPETITIVENESS OF SMEs IN THEPROVINCE OF YOGYAKARTA SPECIAL REGION ENTERING THE ASEAN ECONOMICCOMMUNITY ......................................................................................................................................... 197

Aftoni Sutanto*, Alia Ariesanti** ..................................................................................................... 197

ASSESSING SERVICE QUALITY LEVEL: A STUDY ON THE LIGHT RAIL TRANSIT(LRT)........................................................................................................................................................ 203

Mhd Suhaimi Ahmad; Mohd Daud Ismail; Nor Farisha Omar....................................................... 203

COMMERCE ETHICS of MUHAMMAD PBUH’ AND UNIVERSAL VALUES IN ERA OFPROPHET HOOD.................................................................................................................................... 213

Suwandi; Muhammad Hakimi Mohd Shafiai ; Wan Nasyrudin Wan Abdullah ............................. 213

CALLING FOR KNOWLEDGE, STRONG INTENTION (NIAT), PRACTICAL WISDOMAND BUSINESS PERFORMANCE: ISLAMIC PERSPECTIVE .......................................................... 227

Nur Adillah Binti Abdul Rahman; Noor Hasni Binti Juhdi (DBA) ................................................ 227

THE EFFECT OF LIQUIDITY, PROFITABILITY AND DIVIDEND POLICY ONFINANCING DECISIONS ON BANKING COMPANIES LISTED IN INDONESIA STOCKEXCHANGE (IDX) WITH CONSIDERATION OF THE COMPANY’S GROWTH ASMODERATING VARIABLE .................................................................................................................. 233

Ahmad Nur Budi Utama ................................................................................................................. 233

THE EFFECT OF OWNERSHIP AND MANAGEMENT STRUCTURE ON FINANCIALPERFORMANCE .................................................................................................................................... 241

Iskandar 1), Tona Aurora Lubis 2) .................................................................................................... 241

REVIEW OF PERSONAL AND INTERPERSONAL MOTIVATIONS ON BEHAVIORALINTENTIONS OF NON-DECEPTIVE CONSUMER: THE ROLE OF M-O-A MODEL ..................... 245

Musnaini 1), Asrini2) ........................................................................................................................ 245

vii

MODEL OF ENERGY CONSUMPTION AND COST EFFICIENCY OF FISHERMAN’SCATCH IN JAMBI PROVINCE ............................................................................................................. 253

Tona Aurora Lubis 1), Muhammad Safri 2), Zulkifli 1)..................................................................... 253

THE INFLUENCE OF SERVICE RECOVERY ON BRAND IMAGE OF PUBLIC SERVICECOMPANY : A LITERATURE REVIEW .............................................................................................. 255

Nasta Trilakshmi............................................................................................................................. 255

EFFECT OF OWNERSHIP STRUCTURE AND MANAGEMENT STRUCTURE OF THEFIRM VALUE.......................................................................................................................................... 263

Zulkifli 1), Tona Aurora Lubis 2) ..................................................................................................... 263

POSITIONING STRATEGY AND ITS RELATIONSHIP WITH FINAL DECISION OFPRIVATE UNIVERSITY IN JAMBI PROVINCE ................................................................................. 267

Indra Budaya................................................................................................................................... 267

THE INFLUENCE OF BRAND PROMINENCE ON CONSUMER ATTITUDE ANDPURCHASE INTENTION OF LUXURY FAKE PRODUCTS .............................................................. 277

Mulyadi Raf*; Musnaini** ............................................................................................................. 277

THE PSYCHOLOGICAL CONTRACT IN IMPROVING ORGANIZATIONAL CITIZENSHIPBEHAVIOR (OCB) AND THE ATTITUDE OF EMPLOYEES AS MEDIATOR VARIABLES(STUDY OF COMPARISON ON STATE-OWNED ENTERPRISES, REGIONAL-OWNEDENTERPRISES AND PRIVATE STATE-OWNED ENTERPRISESIN JAMBI PROVINCE) ............. 283

Sry Rosita........................................................................................................................................ 283

ANALYSIS OF INTELECTUAL CAPITAL, THE VALUE OF THE COMPANY TOFINANCIAL PERFORMANCE OF COMPANY (EMPIRICAL STUDY ONMANUFACTURING COMPANY IN BEI ) ........................................................................................... 291

Iwan Eka Putra................................................................................................................................ 291

STRATEGY OF DIFFERENTIATION COMPETITIVENESS OF ISLAMIC BANGKING: ALITERATURE REVIEW ......................................................................................................................... 299

Anzu Elvira ZaharaTobing ............................................................................................................. 299

THE ANALYSIS OF AGRICULTURAL EXTENSION OFFICERS’ COMPETENCE IN THEPROVINCE OF JAMBI ........................................................................................................................... 305

Edison ............................................................................................................................................. 305

HUMAN RESOURCE DEVELOPMENT OF LECTURER FROM THE WEST AND ISLAMICPERSPECTIVES IN THE EFFORTS TO INCREASE THE COMPETITIVENESS OFISLAMIC HIGHER EDUCATION (PTKI) ............................................................................................. 311

Dicki Hartanto................................................................................................................................. 311

ROLE OF A SOCIAL MARKETING CAMPAIGN ON THE DECISION OF THECOMMUNITY TO PAY ZAKAT THROUGH INSTITUTE OF AMIL ZAKAT. ................................ 319

Sigit Indrawijaya............................................................................................................................. 319

ECONOMICS

OPPORTUNITIES AND CHALLENGES OF TAX AMNESTY (ISLAMIC POLITICALECONOMIC ANALYSIS)....................................................................................................................... 327

Muhammad Sholahuddin ................................................................................................................ 327

ANALYSIS OF RICE CONSUMPTION AND RICE IMPORT IN INDONESIA ................................. 331Nanik Istianingsih, Rd. Ade T. Anjaya .......................................................................................... 331

THE ROLE OF SOCIAL CAPITAL ON THE LEVEL OF HOUSEHOLD EXPENDITURE INJAMBI PROVINCE (STUDY OF URBAN AREAS) ............................................................................. 337

Dadang Hardiwan ........................................................................................................................... 337

MONEY ILLUSION EFFECT REDENOMINATION RUPIAH............................................................ 343Evan Stiawan .................................................................................................................................. 343

viii

DETERMINANTS AND EXPORT COMPETIVENESS OF COFFEE: COMPARISONBETWEEN INDONESIA AND VIET NAM .......................................................................................... 349

Zulkarnain Ishak ............................................................................................................................. 349

THE INFLUENCE OF ECONOMIC GROWTH AND ORIGINAL REGIONAL INCOME ININDONESIA DURING THE PERIOD 2007 - 2014................................................................................ 357

Deny Eko Purwanto; Pahrul Rozi ................................................................................................... 357

THE STATE OF LOCAL GOVERNMENT EFFICIENCY IN SUMATRA, INDONESIA................... 365Roosemarina A. Rambe .................................................................................................................. 365

MODEL FOR THE DEVELOPMENT OF PLANTATION-BASED GROWTH POLESVILLAGE................................................................................................................................................. 377

Junaidi; Amri Amir; Hardiani ......................................................................................................... 377

ESTIMATION AND ASSESSMENT OF LAND AND BUILDING TAX BASE OF RURALURBAN SECTOR (PBB P2) AS A LOCAL TAX IN THE DISTRICT MUARO JAMBI..................... 385

Halimah; Zamzami......................................................................................................................... 385

STUDY OF FACTORS AFFECTING DEMAND FOR CREDIT AGRICULTURAL SECTORAND CONTRIBUTION AGRICULTURAL SECTOR TO ECONOMY PROVINCE OFJAMBI ...................................................................................................................................................... 395

Saidin Nainggolan........................................................................................................................... 395

THE EFFECT OF ECONOMIC GROWTH AND THE LEVEL OF WAGES OF IN-MIGRATION JAMBI CITY .................................................................................................................... 401

Yulmardi ......................................................................................................................................... 401

IMPACT ANALYSIS TITLED HUMAN DEVELOPMENT INDEX (HDI) ON POVERTYAND ECONOMIC GROWTH IN THE DISTRICT/ TOWN OF JAMBI PROVINCE ......................... 407

Ardi Afrizal..................................................................................................................................... 407

EFFECT GDP, INTERST RATE, INFLATION TO FDI ASEAN (5) .................................................... 415Handri ............................................................................................................................................. 415

CONTRIBUTION OF FARM NON FOOD CROPS SUB SECTOR ON JAMBI PROVINCEECONOMY.............................................................................................................................................. 423

Yanuar Fitri..................................................................................................................................... 423

THE EFFET OF FINANCIAL INCLUSION ON BANK EFFICIENCY IN A DUAL-BANKING SYSTEM ............................................................................................................................... 429

Juzaili Juhari; Mariani Abdul-Majid............................................................................................. 429

ANALYSIS OF MICRO, SMALL AND MEDIUM CREDITS AND ITS INFLUENCE ON ANEMPLOYMENT IN MICRO, SMALL AND MEDIUM ENTERPRISES (MSMEs) IN THEPROVINCE OF JAMBI ........................................................................................................................... 441

Etik Umiyati.................................................................................................................................... 441

ANALYSIS OF INDUSTRIALIZATION AND ECONOMIC GROWTH IN JAMBIPROVINCE .............................................................................................................................................. 449

Erni Achmad ................................................................................................................................... 449

MODEL ANALYSIS FOR ANNUAL CROP PRODUCTION EFFICIENCY ....................................... 457Kuswanto ........................................................................................................................................ 457

ECONOMIC GROWTH, POVERTY, INCOME INEQUALITY AND UNEMPLOYMENT (STUDY IN ALL PROVINCES IN INDONESIA)................................................................................... 465

Zulgani 1; Syaparuddin 2 ................................................................................................................. 465

FOREIGN DIRECT INVESTMENT IN INDONESIA AND ITS ROLE TO ECONOMICGROWTH (Vector Auto Regression Model Approach) ......................................................................... 471

Siti Hodijah..................................................................................................................................... 471

ANALYSIS OF REGIONAL ECONOMIC GROWTH IN KERINCISEBLAT NATIONALPARK (CASE STUDY KERINCI DISTRICT IN JAMBI) ..................................................................... 479

Adi Putra ......................................................................................................................................... 479

ix

PREVALENCE FERTILITY WHICH CAUSED THE ECONOMIC AND SOCIALCONDITIONS (SPATIAL ANALYSIS BY GEOGRAPHIC WEIGHTED LOGISTICSREGRESSION) ........................................................................................................................................ 489

Fauzi Darwas .................................................................................................................................. 489

THE INFLUENCE OF CREDIT BANKING, INVESMENT, EXPORT AND GOVERNMENTSPENDING ON ECONOMICS GROWTH IN INDONESIA ................................................................. 497

Hasminidiarty.................................................................................................................................. 497

CONTRIBUTION OF AGRICULTURE SECTOR TOWARD GDP AND ELASTICITY OFLABOR ABSORPTION IN EAST TANJUNG JABUNG ...................................................................... 507

Indria Mayesti ................................................................................................................................. 507

DETERMINANT OF ECONOMIC GROWTH IN JAMBI (DEMAND APPROACH) ......................... 513Irmanelly......................................................................................................................................... 513

EFFECTIVE EMPOWERMENT OF PEASANT FOOD. ....................................................................... 517Navarin Karim ................................................................................................................................ 517

DEVELOPMENT MODEL FOR MARITIME TOURISM POTENSIL RELATED WITH THEPEOPLE COASTAL ECONOMY IN GORONTALO PROVINCE ....................................................... 521

Irawati Abdul; Irina Popoi; Zainudin Antuli.................................................................................. 521

MAIZE PROCESSING PRODUCTION DEVELOPMENT AS THE ECONOMIC DRIVEN OFPEOPLE IN GORONTALO PROVINCE................................................................................................ 531

Amir Halid; Mohammad Ikbal Bahuwa; Zainudin Antuli; Irawati Abdul. .................................... 531

BUDGET DEFICIT AND POLICY ANALYSIS IN THE PROVINCE OF JAMBI .............................. 545Junaidi............................................................................................................................................. 545

FISCAL DECENTRALIZATION AND TRADE BETWEEN PROVINCES IN SUMATRA: ANAPPROACH GRAVITY MODEL........................................................................................................... 555

Khabri ............................................................................................................................................. 555

PERCEIVED SOCIO-ECONOMIC IMPACTS OF COAL FUELLED STEAM POWERPLANT PROPOSED TO ESTABLISH IN PULAU BAAI, BENGKULU, INDONESIA...................... 565

Muhamad Abduh; Benardin............................................................................................................ 565

THE EFFECT OF LOCAL FINANCIAL PERFORMANCE ON CAPITAL EXPENDITURE INTHE JAMBI PROVINCE GOVERNMENT................................................................................... 565

Yolanda; Zulfanetti

INDONESIA'S EXPORT-IMPORT ANALYSIS: GRANGER CAUSALITY APPROACH...................566Syaparuddin

ACCOUNTING

IMPLEMENTATION OF PARTICIPATORY BUDGETING, TRANSPARANCY,ACCOUNTABILITY AND PERFORMANCE-BASED BUDGETING TO THEPERFORMANCE OF LOCAL GOVERNMENT UNIT ......................................................................... 569

Baihaqi, Dri Asmawanti S .............................................................................................................. 569

THE INFLUENCE OF THE QUALITY OF HUMAN RESOURCES AND THEIMPLEMENTATION OF THE REGIONAL FINANCIAL ACCOUNTING ON THEQUALITY OF FINANCIAL REPORTS OF REGIONAL TASKFORCE WITH A SYSTEM OFINTERNAL CONTROL THE GOVERNMENT AS VARIABLE INTERVENING.............................. 579

Shylvia Andriani1), Sri Rahayu2), Iskandar Sam2) ........................................................................... 579

INTELLECTUAL CAPITAL, FIRM VALUE AND FINANCIAL PERFORMANCE .......................... 589Aida Irsyahma; Nikmah.................................................................................................................. 589

PERFORMANCE-BASED BUDGET, CLARITY OF OBJECTIVES, BUDGET REPORTINGSYSTEM, OBSERVANCE OF LAWS AND REGULATIONS, AND PERFORMANCEACCOUNTABILITY OF GOVERNMENT AGENCIES ....................................................................... 599

Dri Asmawanti S, Baihaqi, Irawan Sahadi...................................................................................... 599

x

THE EFFECT OF GOOD CORPORATE GOVERNANCE (GCG) ON FINANCIALPERFORMANCE AND THE IMPLICATIONS ON FIRM VALUE ..................................................... 609

Khairiyani1), Sri Rahayu2) ............................................................................................................... 609

ANALYSIS IMPLEMENTATION OF GOVERNMENT ACCOUNTING STANDARS BASEDOF ACCRUAL IN OFFICE OF ASSETS MANAGEMENT AND REGIONAL FINANCIAL............. 619

Khairul Pahmi, Sri Rahayu, Misni Erwati ...................................................................................... 619

THE ANALYSIS OF TURNOVER INTENTION FACTORS AGAINST ACCOUNTANTS(EMPIRICAL STUDY ON FINANCING COMPANY IN BENGKULU CITY) ................................... 627

Nurjoni Amiruddin, Madani Hatta, Zahrah Indah Ferina ............................................................... 627

THE MODERATING ROLE OF FIRM SPECIFIC FACTORS ON THE INFLUENCE OFENTERPRISE AND CREDIT RISK MANAGEMENT ON FIRM PERFORMANCE OFINDONESIAN BANKING COMPANIES .............................................................................................. 635

Saiful, Mentari Arizka .................................................................................................................... 635

THE POLICY FOR SUSTAINABILITY REPORTING OF INDONESIA’S HIGHEREDUCATIONAL INSTITUTIONS ......................................................................................................... 647

Alia Ariesanti .................................................................................................................................. 647

THE EFFECT OF ACCOUNTABILITY AND TRANSPARENCY OF THE LOCALGOVERNMENT FINANCIAL STATEMENTS QUALITY (LKPD) AND THEIMPLICATIONS OF FINANCIAL PERFORMANCE BENGKULU PROVINCIALGOVERNMENT ...................................................................................................................................... 653

Nurna Aziza, Effed Darta Hadi, Hendri Marulitua Hutapea*, Andi Agus**.................................. 653

SYNERGIZING MANACIKA IN THE STRATEGIC MANAGEMENT ACCOUNTING:SOLUTION FOR THE STIGMA OF COOPERATION? ....................................................................... 665

Made Susilawati1*, Unti Ludigdo2, Gugus Irianto3, Zaki Baridwan4 .............................................. 665

THE EFFECTS OF OWNERSHIP STRUCTURE AND FIRM CHARACTERISTICS TOPERFORMANCE AND RISK: THE ROLE OF THE QUALITY OF CORPORATEGOVERNANCE VARIABLE ................................................................................................................. 673

Triyono; Fatchan Achyani .............................................................................................................. 673

EFFECT OF INCENTIVE EXECUTIVE, CORPORATE RISK AND CORPORATEGOVERNANCE ON TAX AVOIDANCE .............................................................................................. 683

Pratana P. Midiastuty, Eddy Suranta, Rama Pramudya Kusuma.................................................... 683

MAPPING THE REGULATIONS AND POLICY ON THE IMPLEMENTATION OFACCRUAL ACCOUNTING IN INDONESIA AND JAMBI MUNICIPALITY..................................... 693

Yudi1)* Made Sudarma2) Ali Djamhuri2) Zaki Baridwan2) ......................................................... 693

THE INFLUENCE OF GOVERNMENT AUDITOR’S KNOWLEDGE, ABILITY, AND SKILLTOWARDS THE EFFECTIVENESS OF AUDIT INVESTIGATION PROCESS ON FRAUDDETECTION IN INDONESIA................................................................................................................ 703

Fitri Habiba Mahmuda*; Fachruzzaman**..................................................................................... 703

RELATIONSHIP BETWEEN THE ACHIEVEMENT OF ECONOMIC GROWTH WITHDIFFERENT QUALITY OF FINANCIAL STATEMENTS AND DISTRICT/CITY INSOUTHERN SUMATRA (SUMBAGSEL)............................................................................................. 713

Intan Purnama Sari; Fachruzzaman ................................................................................................ 713

ANTECEDENTS OF ENTERPRISE RISK MANAGEMENT (ERM) IMPLEMENTATIONAND ITS CONSEQUENCE TO INDONESIAN BANKS’ CREDIT RISK ........................................... 721

Husaini*; Saiful** ......................................................................................................................... 721

THE EFFECT OF CORPORATE SOCIAL RESPONSIBILITY, CORPORATEGOVERNANCE, AUDIT QUALITY, AND LEVERAGE ON INCOME SMOOTHING(EMPIRICAL STUDY ON MINING COMPANIES LISTED IN INDONESIAN STOCKEXCHANGE)........................................................................................................................................... 731

Rini Indriani; Nur’aini .................................................................................................................... 731

xi

INDIVIDUAL CAPACITY AND USE OF ACCOUNTING INFORMATION IN MAKINGFINANCIAL STATEMENTS IN SMALL BUSINESS IN BENGKULU .............................................. 741

Isma Coryanata ............................................................................................................................... 741

ROLE OF THE INTERNAL AUDITOR GOVERNMENT TO REALIZE THE LOCALGOVERNMENT NET ............................................................................................................................. 761

Rahayu; Sri Rahayu ........................................................................................................................ 761

THE PERCEPTION OF NEW ACCOUNTANTS ABOUT SUSTAINABILITY REPORTING(Study at University of Bengkulu)............................................................................................................ 769

Fenny Marietza; Nila Aprila; Nidya Lestari.................................................................................... 769

THE EFFECT OF SHAREHOLDING, PROFITABILITY, LEVERAGE, FIRM SIZE ANDINDEPENDENT COMMISSIONER ON TAX AVOIDANCE: TESTING IN GROUP ANDNON GROUP FIRM ................................................................................................................................ 777

Eddy Suranta; Pratana Puspa Midiastuty; Afrizal Saputra.............................................................. 777

EFFECT VOLATILITY OF COMPREHENSIVE INCOME AND FAIR VALUEAPPLICATIONS TO RETURN AND VOLATILITY OF SHARE PRICE (STUDIES IN THEBANKING COMPANY LISTED ON THE INDONESIAN STOCK EXCHANGE) ............................. 777

Madani Hatta; Naeyza Islamey Ningrum....................................................................................... 777

599

PERFORMANCE-BASED BUDGET, CLARITY OF OBJECTIVES, BUDGET

REPORTING SYSTEM, OBSERVANCE OF LAWS AND REGULATIONS, AND

PERFORMANCE ACCOUNTABILITY OF GOVERNMENT AGENCIES

Dri Asmawanti S, Baihaqi, Irawan Sahadi

Accounting Department- Economics and business Faculty, University of Bengkulu

e-mail: dri_asmawanti@yahoo.com

Abstract. The aim of this study is to empirically prove the influence of performance-based budgeting, the

clarity of the budget target, reporting systems, and adherence to the laws and regulations against the

performance accountability of government agencies. This study was conducted in the Ministry of law and

Human Rights (human rights) of Bengkulu province. The respondents of the research was the leader in

the organization which is under the Ministry of Justice and human rights, by providing questionnaires.

The data used in this study was the primary data of 56 respondents. The tool data analysis applied Smart

PLS version 2.0 M3. The results showed that outher model testing is good for convergent validity,

discriminant validity, and then reliability testing, all showed that the condition of gauges and the existing

data was good. Inner model Testing also showed that its structural equation model was fit. Hypothesis

testing produced that Clarity of budget targets, reporting systems, and adherence to the laws and

regulations have a positive influence against the performance accountability of government agencies.

Performance-based budgets, thus has no effect on the performance accountability of government

agencies.

Keywords: performance-based Budgets, clarity of Objectives, Budget reporting system, observance of

laws and regulations, performance accountability of government agencies

INTRODUCTION

The embodiment of good governance in Government demands the increasing of accountability, by

applying the good norms of in running government wheel such as the application of the system of

accountability for the proper, clear, measurable and legitimate, so that the accomplishment of government

and the development can be directly helpful, effective, clean and responsible, as well as free from

corruption, collusion and nepotism. In a more specific reference, the decision of the head of LAN Number

239/IX/6/8/2003 on guidelines for the preparation of Reporting performance accountability of

government agencies, is explaining that the performance accountability of government agencies is the

embodiment of an obligation of government agencies to be responsible the success and failure of the

implementation of the Organization's mission in achieving the goals and objectives that have been

established through periodic accountability system. To support the enhancement of the accountability, the

Government issued Regulations covering Government Regulation (PP) No. 8 in 2006 about financial

reporting Guidelines and the performance of government agencies, the regulation of the Minister of State

for Administrative Reform State number PER/09/URM.PAN/05/2007 General guidelines about the

determination of the Main performance indicators in an environment of government agencies, and

presidential instruction number 7 in 1999 about the accountability of the performance of government

agencies. One of its realization is by making accountability and evaluation reports contained in the report

of the performance accountability of government agencies (LAKIP). The Government as the provider of

the public funds in order to meet performance accountability may notice a few things like budget,

reporting systems and observance of laws and regulations.

The purpose of this study is to examine the influence of the application of performance-based

budgeting, the clarity of the budget target, reporting systems, and adherence to the laws and regulations

against the performance accountability of government agencies. The budget became a very relevant and

important governmental surroundings because of its impact on government accountability, with respect to

the function of the Government in providing services to the community. Act No. 33 of 2004 and No. 17

of 2004 about the finances of the State has established the use of a performance-based budget approach is

an approach in the preparation of the budgets that are based on the performance to be achieved. The

application of performance-based budgeting is a form of budget reforms in improving the budgeting

process is accountable. Performance-based budget (performance based budgeting) is output-oriented

budgeting and relates very closely to the vision, mission and strategic plan of the Organization (Bastian,

600

2006). Budget performance approach emphasized on the concept of value for money and oversight of

performance output (Mardiasmo, 2002).

The link target of the budget with the clarity of the performance accountability and its effects on

performance accountability was ever delivered by Indudewi (2009) and Anjarwati (2012) who said that

the clarity of the budget goal influences on performance accountability of government agencies. A clear

budget targets will make it easier to account for the success or failure of the implementation of the tasks

of the Organization in order to achieve the goals that have been set previously. The higher the degree of

clarity of the objectives of the budget, it will be increasingly high levels of performance accountability of

government agencies.

Reporting system has related to the accountability of the performance of government agencies.

This has been proved by Anjarwati (2012) and Indudewi (2009) stating that the reporting system has an

effect on performance accountability of government agencies. Regional financial management systems

that include reporting systems will create a transparent financial management and accountability. This

suggests that the higher the level of the reporting system, it will have an effect on increasing

accountability for the performance of government agencies.

Observance of laws and regulations is also an important factor that directly relates to the

accountability of the performance of the Government, as stated in The President of the Republic of

Indonesia number 7 in 1999 about the performance accountability of government agencies. The existence

of this accountability report generated expected would be appropriate and fit within the framework of the

fulfilment of duties to the Central Government and public information needs. Therefore, to realize the

performance accountability of government agencies required obedience over regulatory legislation

(Riantiarno & Azlina, 2011). This is supported by research conducted Sumiati (2012) that proved that

observance of laws and regulations have a positive affect toward the performance accountability of

Government.

The phenomena above indicates that how important performance accountability as accountability

of public institutions that use public funds in an economical, effective, and efficient without any

dissipation of funds and corruption. The results of the evaluation of the performance accountability of

government agencies by 2015 conducted by the Ministry for administrative reform of the State apparatus

and Bureaucracy (PANRB) against 77 ministries/agencies that routinely done every year, the Ministry of

Justice and the human right gain value of B or better with the score 65-75 range. Based on the assessment

and the various pefomena in the top of the link budget, reporting systems and laws and regulations, then

the researchers want to prove in a comprehensive manner the implementation of performance-based

budgeting relation, the clarity of the budget target, reporting systems, and adherence to the regulations

with the performance accountability of government agencies.

THE CONCEPT OF THEORY, THE PREVIOUS STUDY AND FORMULATION OF

HYPOTHESIS

Performance Accountability Of Government Agencies

The increasing demands of society towards the Organization of a good and clean government has

encouraged the development and implementation of a system of accountability that is clear, precise,

organised and effective Accountability Reports, known as government agencies (LAKIP). The goal of

LAKIP is to make the holding of governance and development can take place useful, effective,

responsible and free from the practice of collusion, corruption and nepotism. The Government then issued

a Presidential Instruction of the Republic of Indonesia number 7 in 1999 about the accountability of the

performance of government agencies. In the presidential instruction, there are several definitions of

performance accountability that is the embodiment of the obligations of government agencies accountable

for the success or failure of the Mission of the Organization in achieving the goals and targets that have

been established through the periodic accountability tool. At first the accountability is often associated

with finance, but now performance has been a major concern despite financial (BPKP, 2007; Mardiasmo,

2002). The decision of the head of the LAN Number 239/IX/6/8/2003 on guidelines for the preparation of

performance accountability of government agencies, explaining that the performance accountability of

government agencies is the embodiment of an obligation of government agencies accountable for success

and failure of the implementation of the Organization's mission in achieving the goals and objectives that

have been established through the periodic accountability system.

Performance-based budgeting and performance accountability of government agencies

Performance-based budgeting is budgeting system oriented organization output (output

measurement) as an indicator of performance and closely related to the vision, mission and strategic plan

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of the organization (Bastian, 2006). Performance-based budgeting is budgeting method is done with

attention to the linkages between the output and the expected results of the activities and programs

including efficiency in the achievement of outputs (Kurniawan, 2009). Halim (2007) says performance-

based budget is a method of budgeting that associates each poured in funding activities with the expected

results and outputs including efficiency in the achievement of results. Characteristics of the performance-

based budget in the framework of the application of performance-based budget includes; based on the

inputs, outputs and outcomes to be achieved, the relationship between the input with the output to be

achieved, the performance targets (Asmoko, 2006).

Program on performance-based budget is defined as an instrument of policy that contains one or

more activities that will be implemented by government agencies. The process of drafting the budget first,

and accommodate the needs of the community selection will be filled within a certain period.

Performance-based budgeting requires the creation of new programs and activities and strategies to get

around the limitation of resources. Nina (2009) in her research showed that the implementation of

performance-based budget positive effect on performance of managerial work units of the device area.

Kurniawan (2009) found in his research that the performance-based budgeting a positive effect against

the performance accountability of government agencies.

H1 : Performance-based budgeting a positive effect against Performance Accountability Of

Government Agencies

The clarity of the budget Targets and performance accountability of government agencies

The government budget is one way the implementation of management accounting that is

becoming an essential tool in conducting resource allocation in the Government. Budget is a process

which is implemented by public sector organizations to allocate resources to bear on the needs of the

infinite (the process of allocating resources to unlimited demands) reveal the role of strategic budgeting in

the wealth of a political organization (Deddi, 2008). Kenis (1979) in Robbyta (2013) and Suhartono and

Solichin (2006) says the clarity of the budget target is the extent to which the objectives of the budget

clearly defined and specific purposes so that the budget can be understood by the person responsible for

the achievement. Locke and Lathan (1984) in Samuel (2008) States that the setting of specific goals will

be more productive than not setting specific goals. The budget targets of deliberate clarity to govern the

behavior of employees.

The budget should be able to become a benchmark achievement of performance accountability

expected, so that budget planning should be able to describe clearly the performance target. Therefore the

budget targets should be expressed in clear, specific and understandable by those responsible for

implementing it. The existence of the measurement of the success rate of an organization in the form of

the evaluation mechanism, then it can be known for the performance of an organization (Herawaty, 2011;

Abdullah, 2005). When the target clarity budget stated clearly then the performance accountability of

government agencies has increased. This will encourage employees to do their best for the attainment of

the desired goal, so it could have implications for increased performance. Anjarwati (2012) concluded

that the clarity of the budget target of a positive effect against the performance accountability of

government agencies. Kusumaningrum (2011) show that the positive effect of the budget goal clarity

against the performance accountability.

H2: The clarity of the budget target of a positive effect against Performance Accountability of

Government Agencies

The system of reporting and performance accountability of government agencies

There are three goals of the Government's financial reporting such as managerial accountability,

and transparency. Accountability is defined as the attempt to account for resource management and

implement policies which is entrusted to the organizational units of the Government in the framework of

the achievement of the goals that have been set. Managerial means providing financial information that is

useful for planning and managing the Government's finances as well as facilitating an effective control

over all the assets, debt and equity funds Kusumaningrum (2012). BPKP (2000) stated that a good report

is a quality that should be prepared honestly, objectively and transparently, by using the principle of

liability, exclusions, comparison, accountability, and benefits. Anthony, et al (2005) reveals the

characteristics of a good reporting system is a report detailing the actual achievements of variants based

on factors the causes of organizational units, the annual forecasts are concerned, include a description of

the preparation of systematic, cause variant, and evaluation or action taken to correct a variant which is

not profitable.

Reports can be compiled properly, if the accounting system used is good too, so that the required

reporting systems. Mardiasmo (2002) reveals, the local government as the provider of public funds should

602

be able to provide the necessary financial information accurately, timely and trustworthy. Therefore, local

governments are required to have a reliable accounting accounting systems. Anjarwati (2012) concluded

that the reporting system a positive effect against the performance accountability of government agencies.

Indudewi (2009) discovering the existence of regional financial management systems that include a

reporting system, will create a transparent financial management and accountability.

H3: Reporting system a positive effect against Performance Accountability Of Government Agencies

Adherence to regulations and Performance Accountability Of Government Agencies

Accounting and the relation to this law has been expressed by Soleman (2007) in his view about

accounting and its surroundings, there are 8 elements in the environment affecting the accounting system

of accounting, taxation, funding sources, the political and economic relations, inflation, the level of

economic development, levels of education, and culture, then coupled with the influence of legal and

accounting developments. Robbyta (2013) says the legal system in force in one country depends on the

system that adhered to whether the concerned country adopt the Civil Law or Common Law. The legal

system is rooted in the public sector in accounting is a system of civil law, where any rules associated

with the public sector accounting that are loaded in the form of regulatory legislation. In Indonesia has

many laws and Government regulations published to achieve good governance. Accountability cannot be

effective in the absence of transparency and the rule of law that is clear, so that the development of

accountability required a mechanism and a clear regulation. This indicates that adherence to the

regulations of the legislation will affect the performance accountability of government agencies. Hara

(2010) found that adherence to legal regulations a positive effect on the performance of government

agencies. This is in line with the research Soleman (2007) and Robbyta (2013) are proving the existence

of the positive influence of obedience regulations against the performance accountability of government

agencies.

H4 : Influential positive observance legislation against Performance Accountability Of Government

Agencies

RESEARCH METHODS

This research is quantitative research with testing causality variables independent of the dependent

variable. The variables tested are (the dependent) performance accountability, and performance-based

budgets, clarity of objectives, budget reporting system and obedience regulations (independent).

Accountability is measured by indicators of accountability and honesty of law, accountability processes,

accountability program, and accountability policies, with 12 grains statement. Budget-based performance

measured by the indicators of the budget based on the inputs, outputs and outcomes, the relationship

between the input to the output, the preparation of performance targets, with 5 round statement

(Kurniawan, 2009). The clarity of the budget objectives measured by indicators of budget objectives clear

and specific, understandable, transparent and accountable, as well as relevant, with item 8 statement

(Robbyta, 2013; Yusmaneli, 2008). The reporting system is measured using the preparation of systematic,

causes the occurrence of irregularities, evaluation or actions taken, with the 7 item Declaration (Robbyta,

2013); Yusmaneli, 2008). Obedience regulations legislation measured with 5 round statement (Robbyta,

2013).

The respondents in this study were officials at agency regional office environments on the vertical

of the Ministry of Justice and human rights Work in the Unit as well as Bengkulu in scope which is the

city of Bengkulu. Respondents who participate are officials of the Echelon III, IV, and V consisting of a

head, head of section, head of the subfields and head subsections at regional offices of the Ministry of

Justice and Human Rights Unit and Work Surroundings of Bengkulu local offices. The data was analyzed

using Partial Least Square approach (PLS) (Abdillah, 2015; Ghozali, 2014). First the outer model testing

was done to know the validity and reliability of data. Further inner or structural models was tested to look

at the relationship between invalid constructs. Hypothesis testing is done by the process of

bootstrapping/resampling bootstrapping. Testing the hypothesis put forward can be seen from the

magnitude value of the t-statistic.

THE RESULTS OF THE RESEARCH AND THE DISCUSSION

The number of samples (respondents) in this research was as many as 56 people, consisting of

Local office of Ministry of justice and human rights (23), Bengkulu Lapas Class II A Bengkulu (10),

Rutan class II B Bengkulu (4), class II Bapas Bengkulu (4), Rupbasan class I Bengkulu (3), and the

Immigration Office class I Bengkulu (12). Viewed from gender, 45 men and 11 women. The age of

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respondents was average from 41 to 50 years. Their education was majority of Undergraduate, Graduate

and Diploma. The working time is generally in the range of 21 - 30 years.

The overview of the variable research (performance-based budgets, clarity of objectives, budget

reporting system, observance of regulations and performance accountability of government agencies), all

of them showed greater than average from theoretical. This means that the application of performance-

based budgeting had been applied, was good on the existing reporting system, the budget target planned

has been clear, has the presence of adherence to laws and regulations, and the performance accountability

has gone well. Regional Office of the Ministry of Justice and human rights of Bengkulu has implemented

with either all indicators that are used as measuring variables descriptive statistically based on the data of

the respondents.

Table 1 Descriptive Statistics Of The Variables Research Before Preliminary Swimsuit Segment

Variable

N

Estimated Actual Estimated

Min

Maks

Mean

Min

Maks

Mean

Std.

Deviasi

Performance Based

Budgeting 56 5 25 15 15 25 20,59 2,21

The clarity of the budget target 56 8 40 24 19 40 31,30 5,78

The system of reporting 56 7 35 21 22 35 30,02 3,12

Adherence to regulations 56 5 25 15 14 25 22,13 2,63

Performance Accountability Of

Government Agencies

56 12 60 36 34 58 45,77 4,98

This research used a structural equation model which was analyzed by using the program

SmartPLS 2.0 M3. Outer/measurement model (model of measurement) was applied to know the validity

and reliability of the indicators which connects with the laten variable. The following image shows the

display results of PLS Algorithm after an indicator having a loading of less than 0.70 eliminated.

There are two methods used to assess the validity of the discriminant. The first method is

comparing correlation indicator an invalid construct with the indicator of correlation with another invalid

constructs by looking at the value of the cross between the loading indicator with its construction. The

result showed that there was good discriminant validity, because the correlation value indicators against

the construction of the correlation value is higher than the indicators with another invalid constructs. The

second method is by looking at the value of the AVE (Average Variance Extracted) and the value of the

root of the AVE for any invalid constructs with the correlation between invalid constructs with other

invalid constructs in the model. A good model is required if the value for invalid constructs individualized

AVE roots is greater than the value of the correlation between invalid constructs with other invalid

constructs must be greater than 0.5. The results showed the value of the AVE (Average Variance

Extracred) invalid constructs for performance-based budgets, clarity of objectives, budget reporting

system, observance of regulations and performance accountability of government agencies have a value

greater than 0.5.

In addition to testing the validity of constructs, the reliability of constructs test was done as

measured by composite reliability and reinforced with a Cronbach alpha of indicators that measure

invalid constructs. The test results of composite reliability and cronbach alpha value have composite

reliability > 0.70 and alpha cronbachs > 0.60.

Table 2 Composite Reliability dan Cronbachs Alpha

Variabel Composite Reliability Cronbachs Alpha

Performance Based Budgeting 0,8652 0,7707

The clarity of the budget target 0,9739 0,9687

The system of reporting 0,8836 0,8051

Adherence to regulations 0,8387 0,7181

Performance Accountability Of Government

Agencies 0,8356 0,7041

604

The structural model was evaluated by using the R-square for the dependent invalid constructs

(endogenous) and t-test as well as the significance of the structural parameters of line coefficients.

Testing against the structural model is done by looking at the value of R-square which is a test for

goodness-fit model. The R-square value of 0.2822, which means that invalid constructs variability of

performance accountability of government agencies can be explained by the variability of performance-

based budget invalid constructs, the clarity of the budget target, reporting systems and observance of

legislation of 28.22% whereas 71.78% explained by variables other than the ones examined.

The second test is to see its significance by looking at the values of the parameters and values for

the coefficients of the significance of the t-statistic. To assess the significance of the model prediction of

the structural model in testing, can be seen from the value of the t-statistic between independent variables

to the dependent variable. From the table below shows that the results of the t-statistic calculation of

performance-based budgets (ABK) have no effect against the performance accountability of government

agencies (AKIP) (0.7688) t-table < (1.96). The clarity of the budget target (KSA) has a positive effect

against the performance accountability of government agencies (AKIP). Reporting system (SP) has a

positive effect against the performance accountability of government agencies (AKIP). Obedience

regulations (CHOCOLATE) has a positive effect against the performance accountability of government

agencies (AKIP).

Table 3 Path Coefficient (Mean, STDEV, t-Values)

Original

Sample

(O)

Sample

Mean

(M)

Standard

Deviation

(STDEV)

Standard

Error

(STERR)

t-statistics

(|O/STERR)

t-tabel

ABK >AKIP -0,0707 -0,0881 0,0920 0,0920 0,7688 1,96

KSA > AKIP 0,2250 0,2173 0,0674 0,0674 3,3395 1,96

SP > AKIP 0,3115 0,3173 0,0672 0,0672 4,6382 1,96

KPPU > AKIP 0,3554 0,3663 0,0902 0,0902 3,9416 1,96

The results of the study proved that performance-based budget has no effect against the

performance accountability of government agencies. Implementation of performance-based budget for

this in the Local Office of the Ministry of Justice and Human Rights Unit Works as well as in Bengkulu

have not been able to improve the accountability of the performance of government agencies. The results

605

of this study do not support Kurniawan’s study results (2009) which found that performance-based budget

influence on performance accountability of government agencies. Likewise, Kurniawan (2009) said that

the existence of a relationship between a performance-based budget with managerial performance Unit

Working Device area. Nina (2009) that performance-based budgeting is budgeting method which is done

with attention to the linkages between the output and the expected results of the activities and programs

including efficiency in the achievement of those results. Bastian (2006), argued that the budget is

essentially a performance based budgeting system output-oriented organizations and closely related to the

vision, mission and strategic plan of the organization. Performance-based budgeting is drafting a budget

based on performance planning, which consists of the programs and activities that will be implemented

and performance indicators to be achieved by an entity budgets. The Government at the Regional Office

of the Ministry of Justice and human rights should continue to improve the application of performance-

based budget so that it is able to improve organizational performance (accountability kinerjan government

agencies)

The results of the study proved that the clarity of the budget goal influenced on performance

accountability of government agencies. This means that the more obvious budgetary goal setting made in

the budget of the Regional Office of the Ministry of Justice and human rights Work Units as well as in

Bengkulu, it will also better accountability of its Government agencies ' performance. This study supports

the results of research conducted by Kusumaningrum (2011), Anjarwati (2012) who found that the clarity

of the budget target of a positive effect against the performance accountability of government agencies.

Robbyta (2013) stated that the clarity of the budget target is the extent to which the objectives of the

budget clearly defined and specific so that the budget can be understood by the man responsible for his

accomplishments. The budget should be able to become a benchmark achievement of performance

accountability expected, so that budget planning should be able to describe a clear performance targets.

Therefore the budget targets should be expressed in clear, specific and understandable by those

responsible for implementing it

The research results proved the reporting system have an effect on performance accountability of

government agencies proven empirically supported. Based on the results, this study showed that the better

accountability reporting systems at the Regional Office of the Ministry of Justice and human rights as

well as the working Unit in Bengkulu will be getting better performance accountability agencies his

Government. The results of this study are consistent with research conducted by Indudewi (2009),

Anjarwati (2012) who managed to prove the existence of the influence of the system of reporting against

performance accountability. A good reporting system according to Anthony et al., (1989) in Robbyta

(2013), is a system that specifies the actual achievements of variants, including the annual forecast, the

causes of Variant (deviation) action taken to correct a Variant that is not profitable, and the time required

in order for the actions of the corrections/improvements can be effective. Performance reporting is a

reflection of the duty to represent and to report the performance of all activities and resources that need to

be accounted for. The existence of a good reporting system should make it easier to account for the

success or failure of the implementation of the tasks of the Organization in order to achieve the goals that

have been set.

Observance of laws and regulations have influenced the performance accountability of government

agencies. The results of this research showed that the better adherence to laws-invitation in making

budget and reporting at the Regional Office of the Ministry of Justice and human rights as well as the

working Unit in Bengkulu will be getting better performance accountability of government agencies. The

results of this study support the research of Soleman (2007) and Robbyta (2013), Sumiati (2012) who

found that the observance of laws and regulations influence on performance accountability of government

agencies. The obedience of the laws and regulations referred to in the preparation of the financial

statements, the Government must satisfy the minimum requirements specified in the Government's

accounting standards. Government accounting standards as guidelines are a staple in composing and

presenting financial accountability reports should be aligned with the Government's budgetary system.

Therefore, the classification of the budget in the Government's accounting standards must be the same as

the classification system of budgeting. Public authorities are obliged to obey the rules of the applicable

legislation. Obedience regulations will encourage fluency program so that the achievement of business

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goals or desired goal that will realize the performance accountability. The existence of the adherence to

the regulations will make it easier to account for the success or failure of the implementation of the tasks

of the Organization in order to achieve the objectives that have been set previously.

CONCLUSIONS, IMPLICATIONS, LIMITATIONS AND RECOMMENDATIONS

The results of this study concluded that performance-based budget has no effect against the

performance accountability of government agencies at the Regional Office of the Ministry of Justice and

Human Rights Unit Works as well as in Bengkulu. The clarity of the budget target, reporting systems, and

adherence to the laws and regulations influence the performance accountability of government agencies at

the Regional Office of the Ministry of Justice and Human Rights Unit Works as well as in Bengkulu. This

means that the more clear goal setting the budget, the better the existing reporting systems, and the better

implementation of the legislation, it will be getting a nice performance accountability of government

agencies at the Regional Office of the Ministry of Justice and human rights Work Units as well as in

Bengkulu.

From the results above, this study will hopefully become input for the Regional Office of the

Ministry of Justice and human rights as well as the Unit Works in Bengkulu in assessing the influence of

the clarity of the budget target, reporting systems and observance of legislation against the performance

accountability at the Regional Office of the Ministry of Justice and human rights of Bengkulu. For

officials such as heads of agencies, heads of Sections/fields and Head Subsections/Subfields in carrying

out the functions, duties and responsibilities in improving the accountability of its performance that will

continue to improve and to build competencies in organization by continuing to increase the

accountability of the performance with improving the process of preparation of the budget, reporting

systems and the application of the legislation.

This research process has some limitations that require improvement and development in the next

research which covers only done limited the scope of the Regional Office of the Ministry of Justice and

human rights institutions does not use vertical Bengkulu. This research could be made only by means of

disseminating a questionnaire and does not do interviews with respondents so that the information

obtained was very limited. By the time the researchers doing the distribution, the questionnaire,

questionnaire returns time in constrained because it is not exactly an election time, researchers submit the

questionnaire due to the flurry of each agency. Researchers cannot prove the influence of performance-

based budgets against the performance accountability of government agencies. For next study, it is better

to not only research in the Regional Office of the Ministry of Justice and human rights of Bengkulu, but

also involves the entire vertical agencies that exist in Bengkulu province. Using both interview and

questionnaire method, the data information was obtained better, honest and insightful as well as the

selection of the correct time in distributing the questionnaire.

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