PENGARUH PENDAPATAN ASLI DAERAH, DANA ALOKASI UMUM, DAN BELANJA MODAL PEMERINTAH DAERAH TERHADAP KINERJA KEUANGAN PEMERINTAH DAERAH KABUPATEN/KOTA DI SUMETERA SELATAN

Abstract

This research related to the financial performance of local government districts/cities in the South Sumatra province, which need to be enhanced by the presence of regional autonomy (fiscal decentralization). Local government needs to build and manage public financial accounting system of their own. Many factors can affect the financial performance of local governments. This study aimed to know whether the level of local government wealth proxied by the ratio of the locally-generated revenue (PAD), the dependence of local governments on the central government to the ratio proxied by General Allocation Fund (DAU), and the level of capital expenditures of local governments may improve financial performance of local governments, as measured by the ratio of financial efficiency. By using multiple regression analysis in 15 local government districts/cities in the South Sumatra province from 2018 up to 2012 with 75 sample observations, this study proves that the level of dependency of local governments (DAU) gave positive significant effect on the efficiency (performance) of local government finance, while the level of regional wealth (PAD ratio of the total expenditure areas), and the level of capital expenditures of local government (the ratio of capital expenditure to total expenditure areas) do not significantly affect the efficiency (performance) of local government finance district/city in the province of South Sumatra, while simultaneously affect the efficiency (performance) of local government finance with adjusted R2 value 0.203135.