Relationship Good Governance with Welfare Society Mediated by Local Government Financial Disclosure and Audit Report Opinion Study on Local Government South Southeast Sulawesi
This research to: 1) identify and explain the influence of good governance to the welfare of society with indicators GDP, public consumption and HDI; 2) identify and explain the influence of good governance to the welfare of society through disclosure financial statement local government, and audit report opinion. This research uses secondary data with the 37 local government consisting of first local government of South Sulawesi with 24 cities/districts and first local governments Southeast Sulawesi with 12 cities/districts using census method. The data were tabulated and yielded negative results were excluded from the sample so that the data is processed by 170 samples. Testing is done with the purpose of data variables t+2. The data were analyzed using path analysis. The results showed that: 1) Good Governance affect welfare society with consumption indicators and HDI; 2) Good Governance affect welfare society with private consumption and HDI indicators through audit report but Good Governance has no effect on welfare society through disclosure Financial Statement Local Government; Good Governance has no effect on welfare society with the GDP indicator through audit report. Keyword: Good Governance, Financial Statement Local Government, Audit Report, Welfare Society. 1. Background Research Public welfare from the perspective of financial management areas, can be achieved when applying Good Governance (GG) (UNDP, 2000) Conceptualization of good governance is more emphasis on the realization of democracy, because it is a democratic state organization becomes absolutely necessary for the realization of good governance, which is based on the accountability, transparency, and public participation. Ideally, those three things will be present in each institutional actor is the attention to human values and moral values that permeate every step of governance. (Krina, BAPENAS) Regional autonomy is the right, authority, and obligation autonomous regions to organize and manage their own affairs and interests of local communities in accordance with the legislation (Law 32/2004) Regional government held government affairs under its authority, which is the overflow of the central government to the regions. Nonetheless, government affairs such as foreign policy, defense, security, monetary and national fiscal central government still regulated (Mardiasmo, 2002) Government Regulation No. 60 of 2007 describes the financial statements are prepared to provide relevant information regarding the financial position and all transactions are carried out by a reporting entity during the reporting period. The financial statements are primarily used to determine the economic value of the resources used to carry out the operations of government, assess the financial condition, evaluating the effectiveness and efficiency of a reporting entity, and helps determine adherence to laws and regulations. Reporting entity has an obligation to report on the efforts that have been made and the results achieved in the implementation of activities in a systematic and structured in a reporting period for parties who require such financial statements. Government financial reports should provide information useful to the users of financial statements. The quality of the financial statements show a true and honest information. Qualitative characteristics are the traits that make information in financial statements useful to users. principal qualitative characteristics ie, comprehensible, relevant, and comparable reliability (SFAS No. 1) Local governments in assessing accountability and making good decisions economic, social, political and financial statements must refer to the local government. The financial statements of the local government aims to: a) provide information about the sources, allocation and use of financial resources; b) provide information on the adequacy of the acceptance period to cover all the expenses; c) provide information on the amount of economic resources that are used in the activities of the reporting entity and the results that have been achieved; d) provide information on how the reporting entity to fund its operations and meet its cash needs; e) provide information about the financial position and condition of the reporting entity associated with the sources of revenues, both short and long term, including those derived from taxation and borrowing. f) provide information regarding changes in the financial position of the reporting entity, whether an increase Paper ID: NOV161150 789 International Journal of Science and Research (IJSR) ISSN (Online) 2319 7064 Index Copernicus Value (2013) 6.14 Impact Factor (2014) 5.611 Volume 5 Issue 2, February 2016