Accountability and financial reporting quality mediate internal control systems and performance of public organizations

Iga Pernando, Madani Hatta, Anna Maria Simamora, Danang Adi Putra

Abstract


This research project examines the mediating role of accountability and financial reporting quality in determining the relationship between internal control systems and public organization performance. This research uses the New Public Management (NPM) theory and Stewardship theory to understand the mechanism of accountability and financial reporting quality in determining the relationship between internal control systems and public organization performance. The research methodology involved a survey of 50 responses from non-profit public sector organizations in Bengkulu City. The sampling method used was the saturated sampling method or census of the entire sample. This study used the Structural Equation Model (SEM) to test the role of the relationship between these variables. Our analysis shows that accountability and financial reporting quality mediate the relationship between internal control systems and public organization performance. This has important implications for public organizations seeking to improve their internal control and organizational performance through better-designed accountability systems and quality financial reporting.

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References


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