REGIONAL INVESTMENT FINANCIAL REPORT ANALYSIS IN BADUNG REGENCY

DiA: Jurnal Administrasi Publik, 2021 December Vol. 19 No. 2, e-ISSN: 2615-7268 REGIONAL INVESTMENT FINANCIAL REPORT ANALYSIS IN BADUNG REGENCY I Nyoman Tingkes Corresponding Author: Departement of Management, University of Dhyanapura, Badung, Bali, Indonesia Ida Ayu Putu Sri Widnyani Magister of Public Administration, Universitas Ngurah Rai ABSTRACT The purpose of this study was to analyze the effect of financial reports through symmetric information on increasing investment in Badung Regency, Bali Province. This study was designed using quantitative research methods on data sourced from reports on budget realization and income, reports on changes in excess budget balances, balance sheets, operational reports, reports on changes in equity, cash flow reports, and notes to financial statements from 2016 to 2020. The results of the study found that the liquidity ratio is 6.09, the solvency ratio is 0.017, the activity ratio is 27.83, the profitability ratio consists of ROI-6.77 and ROE-0.22, and the ratio of direct spending to indirect spending is 0.88. Specifically, for the investment in capital-output ratio-ICOR, it was found that the average economic growth per year was 5.29 percent. Based on the results of this study, it can be suggested to the Badung Regency Government that (a) the collection of tax and levy receivables be more optimized, (b) there needs to be a policy regarding the budget deficit, (c) increase direct spending at least equal to or more than the apparatus expenditure, and (d) further improve operating cost efficiency. In addition, spending on grants and social assistance should be more directed at spending on goods and services that are truly vital and strategic. Keywords: liquidity, solvency, activity, profitability, direct spending, and ICOR A. INTRODUCTION Under Government Regulation Number 58 of 2019 concerning Regional Finance, it mandates that good regional financial management is financial management based on the principles of transparency, accountability, and participation, both at the planning and budgeting stages, implementation, and administration, as well as regional financial accountability. The planning and budgeting stages use the performance approach. A characteristic of this approach is the process of clarifying the budget by activity as well as by the organizational unit. The budget that has been grouped into activities will make it easier for interested parties to measure performance. 70 DiA: Jurnal Administrasi Publik, 2021 December Vol. 19 No. 2, e-ISSN: 2615-7268 The implementation and administration stage is a process that is bound by various applicable laws and regulations. The process of implementing and administering regional finances in practice must also take into account the performance that has been determined in the APBD. This process must be in line with the performance indicators that have been agreed upon in the APBD document. Thus, the planned budget can be in line as it should and must be able to improve coordination of various parties in the preparation of accrual-based financial reports, which is a new thing for local governments. The stage of regional financial accountability is realized in the form of financial reports. The financial report is a manifestation of strengthening transparency, accountability, and participation. Regarding financial statements, there are at least seven financial reports that must be made, namely balance sheets, budget realization reports, operational reports, and reports of changes in excess budget balances, reports of changes in equity, cash flow statements, and notes to financial statements. From the background description of regional financial reports as a form of strengthening transparency, accountability, and participation in the implementation of regional revenue and expenditure budgets for five fiscal years, the main issues of regional financial reports can be formulated as follows. What is the quality of the regional financial reports of the Badung Regency Government on investment from 2016 to 2020? Based on these issues, the purpose of this study is to analyze the effect of quality financial reports through symmetric information on the investment of the Badung Regional Government from 2016 to 2020. B. THEORETICAL REVIEW Finance Theory From an economist's point of view, money is a stock of assets used for transactions. Money is something that is accepted or trusted by the public as a means of payment or transaction. Therefore, money can take any form, but that does not mean everything is money. Economics money has four functions, namely as a unit of account, a means of transaction, a store of value, and a standard for future payments. Through these four functions, money has become an important element of development. So, money needs to be managed properly. Besides that, it also needs to be directed and controlled through fiscal and monetary policy instruments towards the desired economic conditions (Prathama and Manurung, 2008). Fiscal policy is an economic policy used by the government to manage/direct the economy to a better or desired condition by changing government revenues and expenditures. Thus, fiscal policy has the same objectives as monetary policy. The difference lies in the policy instruments. If in monetary policy, the government controls the money supply; in fiscal policy, the government controls its revenues and expenditures (Prathama and Manurung). Regarding the quality of good financial reports, financial reports must be result-oriented, professional, proportional, open, and follow the principles of free and independent financial audits. Financial management as far as possible 71 DiA: Jurnal Administrasi Publik, 2021 December Vol. 19 No. 2, e-ISSN: 2615-7268 considers the principle of efficiency, meaning that it does not cause waste that damages the benefit of the region or the welfare of the people. However, in practice, it is still often found that there is duplication of operating expenditure with direct expenditure, especially in non-physical direct expenditure, so that it is difficult to measure. This happened because the allocation of funds did not reflect the actual allocation. Subsidy spending should be directed at vital and strategic expenditures that control the lives of many people, such as subsidies for fertilizers, gas, fuel, and MSMEs. However, in practice, it does not live up to expectations. In addition, control is also often only administrative in nature, so that it is not in accordance with the aims and objectives of the subsidy. The same thing happened to capital expenditures allocated for the purchase of investment needs in the form of fixed assets and other assets. In other spending practices, the majority consists of personnel expenditures, interest expenditures, and official travel expenses, which are not directly related to investment (Anggara, 2016). Regarding quality financial reports, Astika (2016) says that financial re (...truncated)