THE EFFECTIVENESS OF LOCAL FINANCE MANAGEMENT INFORMATION SYSTEM IMPLEMENTATION IN LOCAL FINANCE AND ASSET MANAGEMENT BOARD OF PEKANBARU MUNICIPALITY

Transcription

1 THE EFFECTIVENESS OF LOCAL FINANCE MANAGEMENT INFORMATION SYSTEM IMPLEMENTATION IN LOCAL FINANCE AND ASSET MANAGEMENT BOARD OF PEKANBARU MUNICIPALITY Rukman, Pasca Sundari Sardi Abstract Local Finance Manajement Information system (SIPKD) is a unified and integrated application with the Ministry of Home Affairs that becomes Local Government auxiliary in the implementation of various local finance Regulations. The SIPKD application in Local Finance and Asset Management Board (BPKAD) Pekanbaru Municipality is still facing some problems related to the available hardware capabilities to accommodate the operation of the application. These problems become the basis for the writer to conduct further research in measuring the effectiveness of the SIPKD application in BPKAD Pekanbaru Municipality. This research uses information system indicators to measure the effectiveness variables revealed by Bodnar. This research uses descriptive qualitative method with inductive approach. The SIPKD application in BPKAD Pekanbaru Municipality is considered less effective, there are still some minor problems and has not yet meet the information system indicators in its operation. The suggestions for the SIPKD application in BPKAD Pekanbaru Municipality are: 1. The government should increase the capacity of transmitting tower spreaded evenly in Pekanbaru Municipality in order to be able to carry the system operation without disturbance or long loading. 2. Recruit the honoraries to be the operators of SIPKD. The recruitment done by paying attention to the correlation of honoraries educational background and SIPKD operation. So, the obstacle of the lack competence of apparatus resources can be overcame. Besides that, the government should conduct periodic training to keep sharpen the ability of SIPKD operators in facing changes in applications that are related to the regulations. 3. Conduct hardware periodic checking to anticipate hardware damage because of heavy capacity of SIPKD application operation, and also perform maintenance for supporting hardware and software of the operation to run maximally. I. Introduction 1.1. The Background of Research The development of science and technology increases very rapidly and gives impact on human life. The increase of technology sophistication, especially information technology, can be seen in the society, government, and private sector. This is due to the demands of human desire to find it easier to meet their needs in the aspect of information processing. One of the examples of the development is computer which updates continually for its user convenience in helping to process the data into useful and qualified information, such as in government field. Innovations continue to be done on computerization technology in various programs or software to assist the government in carrying out its duties and achieve good governance. In connection with the establishment of Law No. 25 Year 1999 about Finance Counter Balance of Central and Local Government, and its implementation rules, in

2 particular is Government Regulation No. 105 Year 2000 about Local Finance Management and Accountability, then from the 2001 Fiscal Year, there has been a renewal in the Local Finance Management. With this autonomy, the region is given broad authority to manage its own household with the least possible interference of the Central Government. Local Government has extensive rights and authorities to use the owned financial resources fit with the needs and aspirations of the society who thrive in the region. Referring to the efforts in improving the implementation of decentralization based on the principles of transparency and accountability, the support on the Local Finance Information System is needed. Law No. 33 Year 2004 about Finance Counter Balance between the Central Government and Local Government mandates the support of Local Finance Information System to maintain Fiscal Policy formulation nationally as well as to increase transparency and accountability in the implementation of decentralization. Following up the implementation process of development in line with the principles of good governance, Local Government is obliged to develop or exploit advances of information technology to improve the ability in managing Local Finance and distribute Local Finance information to the public service sector. Related to the area of finance management information system, the government issues Government Regulation No. 56 Year 2005 which mandates that the region convey information relating to the Local Finance and must meet the principles of accurate, accuracy, precision, and liable. However, with such broad authority, it does not mean that Local Government can use owned financial resources without clear directions and purposes. The rights and broad authority granted to each region is essentially a trust that must be justified in accountable and transparent manner, both to the society in the region and to Central Government that has distributed the counter balance funds to all regions in Indonesia. The renewal of finance management in the local autonomy era is characterized by a very fundamental change, ranging from budgeting systems, treasury, until the finance statements accountability. After the local autonomy was revolved, the accountability of local financial statements must be prepared by the Local Finance Management Information System (SIPKD) in which the application was built by the General Directorate of Local Finance of Home Affairs Ministry in order to speed up data transfer and efficiency in Local Finance data collection. In the explanation of Government Regulation No. 56 Year 2005 Article 13 Letter a, it is stated that the definition of Local Finance Management Information System (SIPKD) is a set of process and procedure done by Local Government in the context of budgeting preparation, budgeting implementation, and Local Finance statements. The SIPKD application is processed by the Sub-Directorate of Local Finance Management Information of the Directorate of Local Finance Implementation and Accountability. SIPKD is a set of integrated application used as a tool that helps in increasing the effectiveness of the regulations implementation of Local Finance management based on the principles of efficiency, economical, effective, transparent, accountable and auditable in the processes that occur in local finance management at the level of the Local Work Unit which includes the process of budgeting, planning, administration and accountability. The SIPKD application is implemented in the hope of creating work effectiveness and improves efficiency in managing Local Finance Pekanbaru Municipality Government. The success of a region in finance management indicated by the disjointed management of the Local Budget and the State Budget that has direct impact on the success of local autonomy and efforts to achieve good governance. Referring to Pekanbaru Municipality Local Regulation No. 6 Year 2004 Article 2 which describes the system of Local Finance management in which it is the main system of integration of planning and budgeting system, accounting system, finance system, information system and revenue administration, local goods management information system, and accountability system.

3 Therefore, it can be concluded that in order to assist the mode of good Local Finance management, some integration of multiple systems are needed and one of them is information system. Local Finance Management Information System (SIPKD) must be arranged in the form of Local Government legal product that also plays role as System Manual and Local Finance Management Procedures under the Regulation of the Minister of Home Affairs No.13 Year 2006 about Local Finance Management Guidelines. The activities of Local Finance management include the activities of budgeting, financial administration (finance administrative procedures of cash revenue/expenditure), and reporting or accounting procedures. Meanwhile, in Local Finance and Asset Management Board Pekanbaru Municipality, the procedures covered by the SIPKD application include: Budget procedure, the procedure of Verification, Treasury, and Accounting, the procedure of Expenditure Treasurer, and the procedure of Revenue Treasurer. The application of this system still has some technical problems related to the finance administration process and the latest understanding of the application version which continues to be refined, as well as the obstacles from the capability aspect of internet access in accommodating the application implementation which is often used by dozens of Local Work Unit in Indonesia at the same time that may result to error or barriers in inputting information. However, in addition to the existing obstacles, SIPKD produces the output that is more structured than the preparation by using manual system. Referring to the above phenomenon, the writer tries to investigate the effectiveness of Local Finance Management Information System of Local Finance and Asset Management Board in Pekanbaru Municipality. By optimizing the application of Local Finance Management Information System (SIPKD) of Pekanbaru Municipality, it will assist the Local Finance management effectiveness Statement of the Problems Identification of Problems Referring to the description above, the problems faced by the Local Finance and Asset Management Board in implementing SIPKD application can be identified as follows: 1. SIPKD so far has been able to help expedite the process of finance data gathering. However, the application of SIPKD still faces technical problems. Internet access capability in accommodating the operation of this application is often used at the same time by dozens of SIPKD so may result in system errors or barriers to input information and the application could not be opened. 2. There is no price standard yet; resulting in values inputted by SIPKD can still be manipulated. 3. Lack of socialization/training to operators of SIPKD organizer regularly and systematically; resulting in the operators do not have the latest knowledge about the SIPKD application which is always being improved and impact on the delay of finance information presentation process Formulation of the Problems 1. How is the effectiveness of the SIPKD application of Local Finance and Asset Management

4 Board in Pekanbaru Municipality to assist Local Finance administration/budgeting? 2. How the SIPKD manages finance and budgeting/administration in Local Finance and Asset Management Board of Pekanbaru Municipality? 3. What are the inhibiting factors in the operation of SIPKD application? 1.3 The Purpose and Objectives The Purpose The research conducted is intended to obtain data about the effectiveness of Local Finance Management Information System Implementation of the Local Finance and Asset Management Board in Pekanbaru Municipality, Riau Province The Objectives 1. To find out the effectiveness of SIPKD implementation in assisting the finance administration/budgeting of Local Finance and Asset Management Board in Pekanbaru Municipality. 2. To find out how the application of Local Finance Management Information System in Pekanbaru Municipality. 3. To find out the inhibiting factors in the operation of the SIPKD application in Pekanbaru Municipality. 1.4 The Benefits of Research Program Practical Benefits for Research Program Location The results of this study are expected to contribute ideas and feedback to the Government of Pekanbaru Municipality in managing Local Finance, especially in terms of administration or budgeting with the help of Local Finance Management Information System (SIPKD) of the Local Finance and Asset Management Board (BPKAD) Pekanbaru Municipality. It is also expected to be a comparative study by LFAMB apparatus regarding to the development of Local Finance management and become theoretical knowledge especially about Local Finance Management Information System. 1.5 The Concept Definition of the Observed and Studied Objects The Definition of Effectiveness Effectiveness is an element in terms of quality, quantity, and time measured in percentage to determine the success of an organization or management in achieving the set targets in the form of programs and activities. Furthermore, in Siagian (1999:20) it is described that the effectiveness is the use of resources, funding, facilities and infrastructures in certain amount being set consciously earlier to produce a number of goods or services with certain quality on time". Simply putting the effectiveness based on point of view of Mahmudi (2010:92) is as follow: Effectiveness is related to the relationship between expected results and achieved actual results. Effectiveness is the relationship between the output and the goal, the greater the output contribution to the achievement of the goal, the more effective the organization, program or activity be, that is considered effective

5 if the resulting output can meet the desired objectives or spending wisely. Based on the definitions above, it can be concluded that effectiveness can be assessed by paying attention to the purposes of the program or activity, and then compared with the achieved actual results. Information system effectiveness can be measured by determining the appropriate indicators to the examined problems. George H. Bodnar, cited in Siswo and Dian (2013:4) in Jurnal Universitas Negeri Surabaya, explains that the effectiveness measurements of information system are as follows: 1. Data Security Indicator It is related to the information system capability in anticipating illegal access and system damage. 2. Time Indicator It is related to the accuracy of information in system usage request; the level of capability of an information system in processing information into a report periodically or non-periodically for a predetermined time span. 3. Accuracy Indicator It is related to the degree of freedom of the information output error. In large data volumes usually there are recording errors and miscalculations. 4. Report Variation or Output Indicator It is related to the completeness of the information content. In this case, it is not only about the volume, but also about information system capability level in making report with development and calculation according to information user needs. 5. Relevance indicator It shows the benefits resulting from the product or output of information, both in the data analysis, services, and data presentation. This demonstrates the suitability and benefits of the generated report The Definition of Application The application is the process of carrying out activities based on existing policies in order to achieve the target within the determined program. Ali (1995:1044), cited from on July 18, 2013, defines that the application is put into practice, pair. It can be concluded that the application requires the element of practiced program and based on the existing policies The Definition of Local Finance Management Information System (SIPKD) The definition of Local Finance Management Information System (SIPKD) quoted from on July 6, 2014 is: Local Finance Management Information System (SIPKD) is an integrated application that is used as a tool for Local Government to improve the implementation effectiveness of various regulations in Local Finance management based

6 on the principles of efficiency, economical, effective, transparent, accountable and auditable. This application is also one of the real action manifestation facilitated by the Ministry of Home Affairs to Local Government in Local Finance management sector to strengthen perception agreement of Local Finance management system and procedures in the interpretation and implementation of various laws and regulations. II. Analysis and Recommendations 2.1 Analysis Local Finance Management Information System in BPKAD Pekanbaru Municipality The Description of Local Finance Management Information System in BPKAD Pekanbaru Municipality In accordance with the needs of Central and Local Government in terms of uniformity and accelerate the financial information accumulation and meet the principles of effective, efficient, economical, accountable, auditable and transparent, the SIPKD application so far has been able to realize the things mentioned above. The information system activity is basically formed through regular operation of activities, they are: a. Collecting Data b. Grouping the data c. Counting d. Analyzing e. Presenting the report

7 Figure 2.1 General Cycle of Local Finance Accounting Information System Revenue Treasurer Implement District Head PC PC PC PC SERVER Figure 2.2 General Framework of SIPKD SKPD USER DIISTRICT HEAD DOCUMENT DOCUMENT Selling PC FINANCIAL REPORT FINANCIAL REPORT

8 The steps of transaction data input to generate the SIPKD application output in the Expense Administration module are: Figure 2.3 The Front Page of SIPKD Application Pekanbaru Municipality Figure 2.4 The Log In Page of SIPKD 1. After logging in, the admin can perform finance management processes, one of which is the procedure of making RKA (Budget Work Plan/BWP). Select the following menu:

9 Figure 2.5 The Operation Stages of SIPKD 2. Then you will see the following activity program picture: Figure 2.6 The Operation Stages of SIPKD 3. To view activity program, it can be done by clicking on one of the BPK (Finance Auditor Board/FAB)numbers that you want to see and select the will be entered SKPD (Local Work Unit/LWU).

10 Figure 2.7 The Operation Stages SIPKD 4. The following is the page input of price on RKA SKPD: Figure 2.8 The Operation Stages of SIPKD After the data entered and clarified correct, then to see the output is by clicking Penatausahaan Pengeluaran (Expense Administration), then click BKU Bendahara Pengeluaran (Treasurer Expenditure of General Cash Book/GCB), click persetujuan (approval), and finally click belanja langsung (direct expenditure).

11 Figure 2.9 Infrastructure Configuration of SIPKD Source: The description above explains one of the SIPKD that can facilitate the work of Local Government with the available format; the operator only needs to enter the necessary transactions. In an interview with the Head of the Budget Division in BPKAD Pekanbaru Municipality, Alek Kurniawan, SIP, M.Si., on January 26, 2015, he explained that it is auditable, accountable, efficient, with IT that being used by Local Work Unit (SKPD), fraud can no longer commit. In terms of transparency, it is very transparent because anyone can access. Then based on interview with the Head of Local Finance and Assets Management Board, H. Bustami HY, SH, MM, on January 26, 2015, he explained that SIPKD is a Government program that came from the aid of the Bank Asia with the goal of harmonization of finance management information. The Local Finance Management Information System (SIPKD) and Regional- Local Finance Information System (SIKD) are the mandate of the Government Regulation No. 56 Year 2005 concerning Local Finance Information System, which is an integrated system that can be a tool for the region local finance management, so the writer supports fully on this activity and appeals to the Regency/Municipality Government to use this application because SIPKD application is given for free and already under the provisions of Laws and Regulations related to local finance management. Following up on the establishment of the Government Regulation No. 71 Year 2010 concerning the Government Accounting Standards (SAP) which obliges the implementation of accrual accounting basis by the local government, the right momentum for the regions that do not use the SIPKD application because the present SIPKD has already accommodate these regulatory changes. Even accrual-based SIPKD has been tested on several regions. Following the Encyclical of the Minister of Home Affairs No. SE.900/22/BAKD February 13, 2008 about the Application, Development, and Implementation Guidelines of SIPKD,

12 and No. SE.900/806/BAKD about the Implementation of SIPKD-SIKD Regional, the Local Government must do the followings to support the effectiveness of the SIPKD implementation: a. Re-structuring local finance management for SIPKD application. The Local Government still refers to the respective local regulations about the local finance management principles. b. Changing the Local Budget by utilizing SIPKD application for the Local Government that still do the finance management manually or has implemented SIPKD. c. Implementing SIPKD application for the Provincial Government that has not implemented it yet to each SKPD as soon as possible. In the explanation of the Government Regulation No. 56 Year 2005, Article 13 Letter a, it is stated that SIPKD is a set of processes and procedures organized by local governments in the context of budget preparation, budget execution, and local finance reporting. In line with this definition, it can be concluded that SIPKD is part of the SIKD that can be interpreted as local finance data processing. The SIKD related to finance established in the Government Regulation No. 45 Year 2013, Article 180, which states that: a. In the framework of the management and accountability of the State Budget, the Minister of Finance organizes integrated information system. b. The integrated state finance information system as referred to in paragraph (1) shall include information system in state ministry/institutions, and Local Government. c. The information system in state ministry/institutions and Local Government referred to in paragraph (2) is an information system of state finance. d. Perform monitoring and controlling, and evaluate the funding of Decentralization, Deconcentration, Assistance Duties, Local Loan, and Local Budget Deficit. As stipulated in the Government Regulation No. 56 Year 2005 Article 4 that local finance information submitted by the regions to the Government as stated in Article 2 includes: a. Local Budget and the Realization of Provincial, Regency, and Municipality Budget b. Local balance c. Cash flows statements d. Notes to the local finance statement e. De-concentration and assistance funds f. Local company finance statement g. The data related to fiscal needs and local fiscal capacity Furthermore, in the explanation of the Government Regulation No. 58 Year 2005, Article 100 Paragraph (2) explains that Local Finance Manager Official prepares finance statements of local government, they are: a. Budget realization report b. Balance c. Cash flows statement d. Notes to the local finance statement While in the Government Regulation No. 71 Year 2010 Page 7 Number 14 states that the components contained in a set of finance statements derived from budget implementation reports and finance statements, so that all components are as follows: a. Budget realization report b. Report of changes in the surplus budget balance c. Balance d. Operational report e. Cash flows statement f. Equity changes statements g. Notes to the finance reporting

13 The above components have been added with 3 new components. The finance statements are presented in accordance with SAP as stipulated in Law No. 17 Year 2003 Article 32, Law No. 32 Year 2004, Law No. 33 Year 2004, Government Regulation No. 56 Year 2005, and Government Regulation No. 58 Year BPKAD of Pekanbaru Municipality as Local Finance Manager Unit has duties to coordinate the finance information from each SKPD in Pekanbaru Municipality through integrated SIPKD, so that SKPD in Pekanbaru does not need to send a representative to submit finance information to BPKAD, and does not need to prepare arranged finance information print out. All of the finance information only needs to be entered into the application that has provided the structure or format that has been set uniformity. SIPKD is an invaluable tool in the process of local finance management from the budget planning to budget reporting stage based on the prescribed Legislation. SIPKD refers to Government Regulation No. 58 Year 2005, Regulation of the Minister of Home Affairs No. 13 Year 2006, and Regulation of the Minister of Home Affairs No. 59 Year SIPKD processed by the Sub- Directorate of Local Finance Management Information in the Directorate of Local Finance Implementation and Accountability. SIPKD is an integrated set of application used as a tool that helps to increase the effectiveness of the implementation of various regulations in local finance management based on the principles of efficiency, economical, effective, transparent, accountable, and auditable in the processes that occur in the local finance management at the level of Local Work Unit (SKPD) which includes the process of budgeting, planning, administration, and accountability The Analysis of the Effectiveness of Local Finance Management Information System Implementation in Local Finance And Asset Management Board Pekanbaru Municipality The finance statements of the government is an important component in achieving finance management accountability to the public. The function of information in the finance statements will not have the benefit if the presentation is not reliable and not in a specified time. SIPKD has an important role in the preparation of finance information in Pekanbaru Municipality in helping to prepare the structured finance statements and accelerate the delivery of finance information on the basis of technology. Based on interview with the Head of BPKAD, the Head of Budget Division, and the Consultant of SIPKD application in BPKAD from PT. Usadi Sistemindo Intermatika, there are obstacles faced by the application as follows: 1. Network; SIPKD is an online operated application, so it will need the network support to help accelerate the data transfer. Through interviews on Monday January 26, 2015 the LFMIS Application Consultant in BPKAD,Ricardo, explained that due to the online application and is also used by all SKPDs every day at the same time, sometimes causing congestion during the process of finance management process with SIPKD. 2. Technology; a developed computerizebased program is essentially has the goal of enabling users to carry out variety of purposes, but the development of this renewable sophisticated program is meaningless if it is not supported by adequate equipments.

14 To support the implementation of application, it is required technology devices that have sufficient capacity to accommodate the operation of the application. In an interview with the Head of BPKAD on Monday, January 26, 2015, he said that: Actually in the application itself so far been able to meet the government needs to accelerate the local finance administration and there are no constraints in the system. But related to regulatory demands, the application continues to refine and require the technology support in terms of hardware capacity. A computerized product is very susceptible to the hardware damage; it is still an obstacle in the SIPKD application. Damage is commonly happened because the hardware capabilities are insufficient to accommodate the operation of the application, so it militates the hardware processing. It is necessary to upgrade the device regularly. 3. The ability of apparatus resources in facing the regulation; SIPKD is a renewal application. It is the demand of rolling regulation dynamics by government to improve the local finance management. From the interview conducted on Monday, January 26, 2015 with the SIPKD Application Consultant in BPKAD, Riacardo, he explained that: SIPKD application has tremendous benefits that can be felt by local government in assisting local finance administration until local finance reporting. The benefits of this advanced application are less influenced by other users who basically have different capacities to absorb the renewal application. Application version changes occur preceded by the passing of new regulations. Changes in version require a new understanding. PT. Usadi Sistemindo Intermatika conducts training on any changes to the application so that the application operator from each SKPD knows the operation of the new version of the SIPKD application. Unfortunately, for operators who have poor absorption, it will cause delays in the running application and the effect on delays of presented local finance information. Besides, with different understanding, the operators are demanded to use the newest version in accordance with the running Regulation for uniformity of SIPKD outputs. The first thing in discussing the effectiveness of Local Finance Management Information System implementation is related to the enactment of Law No. 25 Year 1999 about Finance Balance of Central and Local Government, and its implementation rules, in particular Government Regulation No. 105 Year 2000 about Local Finance Management and Accountability, then starting from the fiscal year 2001, there has been a renewal in the local finance management. The implementation and improvement of the system are always conducted with the budget performance measurement which is part of the budget analytical process to measure finance performance. According to George H. Bodnar cited in Siswo and Dian (2013:4) in Jurnal Universitas Surabaya that the effectiveness measurements of information system are as follows: 1. Data Security Indicator; It is related to the information system capability in anticipating illegal access and system damage. 2. Time Indicator; It is related to the accuracy of information in system usage request; the level of capability of an information system in processing information into a report periodically or nonperiodically for a predetermined time span. 3. Accuracy Indicator; It is related to the degree of freedom of the information output error. In large data volumes usually there are

15 recording errors and miscalculations. 4. Report Variation or Output Indicator; It is related to the completeness of the information content. In this case, it is not only about the volume, but also about information system capability level in making report with development and calculation according to information user needs. 5. Relevance indicator; It shows the benefits resulting from the product or output of information, both in the data analysis, services, and data presentation. This demonstrates the suitability and benefits of the generated report. Through the above theories, the writer determines the effectiveness of the SIPKD application in Pekanbaru BPKAD Municipality measured through interviews and associated with the theory used. The measurement variables of the effectiveness of the local finance management implementation in this research include the variable of data security, time, accuracy, relevance, report variation, and physical comfort. Furthermore, it is described by the Head of BPKAD Pekanbaru Municipality, H. Bustami HY, SH, MM in the interview on Monday, January 26, 2015 that SIPKD is a Government program that came from the aid of the Bank Asia with the goal of harmonization of finance management information. To decide whether the SIPKD application in BPKAD Pekanbaru Municipality is effective or not, the following considerations of system element design should be done. Table 2.1 System Element Design Considerations SYSTEM ELEMENT DESIGN CONSIDERATION DATA INPUT Time Accuracy MANAGEMENT Time Accuracy DATA STORAGE Data Security Data Relevance OUTPUT Report Variation Time Accuracy Through the indicators mentioned above, the writer analyzes the effectiveness of the SIPKD implementation in BPKAD Pekanbaru Municipality by linking the results of interviews and documentations. The followings describe one by one the dimension of information system effectiveness. a. Data Security Dimension This is related to the way the system in addressing the system failure that it is likely can lead to data loss, and the system ability to maintain data from illegal access. Data security dimension can be reviewed through the following points: 1. The SIPKD ability in facing sudden electricity failure Sudden electricity failure often becomes problem that interferes with the passage of the system. Due to the electricity failure can cause the system to join stalled. SIPKD is a computerized-based application, thus SIPKD needs power source to operate the application supporting hardware. In relation with the case, the BPKAD is only able to anticipate it by using UPS and generator engines. As explained by the Consultant of SIPKD in BPKAD Pekanbaru Municipality, Ricardo, on January 26, 2015 that :

16 For the sudden electricity failure, it is only can be anticipated by UPS. So when the electricity is off, the UPS makes the computers remain run for some times, so the administrators can save the data before the UPS off and the electricity generators are turned on. But, if the main tower of network center which connects all system comes off, that we cannot do anything. As explained above, the writer concludes that SIPKD has not been able to anticipate the sudden electricity failure problem resulting in the cessation of operation of the system. So, if the system stopped, then the data being input will be lost, unless it is assisted by UPS and generators. If the main tower system of system network connector with the server is also failure, then the administrator/users could not operate SIPKD, either input data or other SIPKD functions. 2. The SIPKD ability to address illegal acsess Based on interviews with the Consultant of SIPKD in BPKAD Pekanbaru Municipality (Ricardo) on January 26, 2015, he explained that Data security in terms of users already set up for its access rights, so that modules that can be opened by other users and administrators have been adjusted in the system. According to the statement of the respondent above, it can be concluded that the SIPKD application has met data security system design consideration. So, do not worry about the data will be in unauthorized access by unauthorized parties. The system design installed in SIPKD ensures the security of financial data from unauthorized parties. b. Time Dimension In accordance with the goal of SIPKD creation which is to help accelerate the collection and administration of local finance information, then SIPKD must meet time accuracy consideration. In an interview with SIPKD Consultant in BPKAD Pekanbaru Municipality, Ricardo, on January 26, 2015 is as follows: SIPKD clearly gives the precision and acceleration time due to the presence of the integrated system, so that the LWUs do not need to send a representative to come and then do a queue to submit financial data of each SKPD. All are done with the information system. The SIPKD in data input, search the required data, process data, present data, to send and receive trustworthy information or data because the SIPKD ability to run commands are fast, but if the network is down, then it will slow down the whole process. Furthermore, it is also described by the Head of BPKAD Pekanbaru, H. Bustami HY, SH, MM, in an interview on January 25, 2015 as follows: SIPKD was made in such a way that the entire finance procedures can be done by clicking the available menu. Moreover, when making Budget Implementation Document, we only need to click the file and do not need to copy manually again. Thus, SIPKD is saving the time in finance statements making. Based on the interview results, the writer concludes that the SIPKD is in conformity with the purpose submitted by the Ministry of Home Affairs that can help accelerate the accumulation of data or financial information. However, it needs to be supported by the network ability to accommodate the operating system used simultaneously by all SKPDs.

17 c. Accuracy Dimension A system is established in order to facilitate the users in performing the contemplated work in the system. SIPKD is the information system that manages the various forms of administration of the finance statements. Additionally, BPKAD is a SKPD doubles as SKPKD that has a function to coordinate the entire financial data or information from all SKPDs in Pekanbaru Municipality. Related to this, the SIPKD is required to own the ability to minimize or overcome the error problems in the input process of financial data. Based on the interview with the Head of the Budget Division of BPKAD Pekanbaru Municipality, Alek Kurniawan, SIP, M.Si, On January 26, 2015, he explained that: So far, the results issued by SIPKD has not occurred error yet, because the finance data is entered and verified, they can be corrected and improved. But for correction and improvement can only be performed by administrator in BPKAD. Moreover, it is explained again by SIPKD Consultant in BPKAD Pekanbaru Municipality, Ricardo, on January 26, 2015 in the interview that for data input errors can be adjusted as long as not violating existing regulations. SIPKD is set up in accordance with applicable regulations and uniformity. It can be seen that the data input errors are not problems in the operation of SIPKD because so far these things are tackled that misstatement of financial information has not happened. a. Report or Output Variant One of the considerations of an information system is the output completeness generated by the system; whether the system generates complete information in accordance with government requirements or not. Under the Government Regulation No. 71 Year 2010 Page 7 Number 14 states that the components contained in a set of finance statements from budget implementation reports and finance statements are: a. Budget realization report b. Changes of the surplus balance budget report c. Balance d. Operational report e. Cash flows statement f. Equity changes statement g. Notes of the financial reporting As aforementioned earlier by the writer, SIPKD includes seven components of finance statements in accordance with Government Regulation No. 71 Year SIPKD Consultant in BPKAD Pekanbaru Municipality (Ricardo) on January 26, 2015 explained as follows: The produced finance statement and information is very complete, all that needed in local finance management are in the SIPKD. Besides, custom report serves to make custom report based on the request or needs of local government based on the prescribed Local Regulation and Mayor Regulation. SIPKD provide custom report menu which means it can provide finance statements with a format adjusted to the needs of each region. It can be concluded that the outputs of SIPKD are not only complete in accordance with Government Regulation No. 71 Year 2010, but also have the advantages that help local government to meet the local finance information needs. b. Data Relevance An information system is demanded to generate the data or information relating to the information required by the Government. This is explained by the Consultant of SIPKD in

18 BPKAD Pekanbaru Municipality, Ricardo, on January 26, 2015 that this application is adjusted with Government Accounting Standards, the Regulation of the Minister if Home Affairs so the outputs are in accordance with the Government.. From the explanation above, the writer concludes that SIPKD is able to present information relating to the Government needs about the local finance management, both in accordance with the format of the Regulation of the Minister of Home Affairs, the Local regulation, and Regulation of the Mayor of Pekanbaru Municipality. Assessing the effectiveness of the SIPKD application also considers the purpose of it. In accordance with that presented by the Ministry of Home Affairs, that SIPKD is an integrated application that helps accelerate the collection and the uniformity of financial information that meets the principles of efficient, economical, transparent, accountable and auditable. Based on the interview with the Head of BPKAD Pekanbaru Municipality, H. Bustami HY, SH, MM, on January 26, 2015, he stated that at this point, we feel the fulfillment in terms of administration and reporting. For the users in the regions, SIPKD can straightly access to the Ministry faster and transparent. Then it is explained further by the Head of the Budget Division of BPKAD Pekanbaru Municipality, Alek Kurniawan, SIP, M.Si, On January 26, 2015 that it is auditable, accountable, efficient, with IT that being used by Local Work Unit (SKPD), fraud can no longer commit. In terms of transparency, it is very transparent because anyone can access. Furthermore, it is illustrated by SIPKD Consultant in BPKAD Pekanbaru Municipality, Ricardo, on January 26, 2015 that it is approaching, for transparent, efficient, economical, auditable and accountable terms, the application is sufficient to meet. The SIPKD application can be said auditable and accountable because the format used in SIPKD is the appropriate uniform that has been set by the Ministry of Home Affairs, and the transparency can be seen by granting freedom to access with restrictions only to see financial information, not to do editing. In an interview with the Head of BPKAD Pekanbaru Municipality, H. Bustami HY, SH, MM, on January 26, 2015, he revealed that SIPKD was made in such a way that the entire finance procedures can be done by clicking the available menu. Moreover, when making Budget Implementation Document, we only need to click the file and do not need to copy manually again. Thus, SIPKD is saving the time in finance statements making. In accordance with the above explanation, it can help the writer to conclude that SIPKD helps in terms of time efficiency and cost efficiency because by the information system, the government can minimize the cost of transportation of officials, because the SKPD no need to send the representative to the BPKAD again in order to compile finance statements. Besides transportation costs, it also raises the efficiency of utensils. It can be seen from RKA of the Local Secretariat Pekanbaru Municipality and BPKAD Pekanbaru Municipality illustrated in the following graph:

19 Graph 2.1 Utensils Direct Expenditure Cost of Local Secretariat Pekanbaru Source: RKA of the Local Secretariat SKPD of Pekanbaru Municipality in 2011, 2013, and 2014 In 2011 and 2013, BPKAD Pekanbaru Municipality has not been formed. Local finance management was still done by the Local Secretariat. Then, in 2014 BPKAD Pekanbaru Municipality was established. Here is a graph of the utensils supply cost in the RKA of BPKAD Pekanbaru Municipality in 2014 and 2015: Graph 2.2 Utensils Direct Expenditure of BPKAD Pekanbaru Municipality BPKAD Rp Rp

20 Source: RKA of BPKAD Pekanbaru Municipality in 2011, 2013, and 2014 Based on the charts above, it can be seen that the decline in the cost of utensils provision, both in the Finance Division of the Local Secretariat and in BPKAD Pekanbaru Municipality. This is no longer required due to the inexistence of financial data collection done manually, for example written on paper or in a book that is susceptible to errors and should be improved by using new paper or book. Meanwhile, the whole formats of SIPKD have been stored in the system, if the input data is wrong, we only need to reopen the existing menu and then be repaired by authorized administrators.. III. Recommendations 3.1 Conclusions Based on the observation on the Effectiveness of the Implementation of Local Finance Management Information System in Local Finance and Assets Management Board Pekanbaru Municipality, the conclusions can be stated as follows: 1. The Implementation of Local Finance Management Information System in Local Finance and Assets Management Board Pekanbaru Municipality is less effective. It can be viewed from the information system effectiveness indicators that are unfulfilled yet. However, SIPKD has meet its aim revealed in Government Regulation No. 56 Year 2005, which is to accelerate in local finance information collection and fulfill the principles of efficient, transparent, economical, accountable, and auditable. 2. SIPKD application implementation built with the concept of ERP (Enterprise Resource Planning), which integrates the data base of the Provincial Government, either online or offline. Then the generated output were structured and integrated with the Ministry of Home Affairs so as to fulfill the principles of efficiency and transparency. In the implementation of SIPKD application, Riau Province was designated as a Pilot Project and Pekanbaru Municipality as the representation of Riau Provinc e. SIPKD implemented in each SKPD in Pekanbaru Municipality to assist financial information collection and for uniformity of the financial reporting. BPKAD of Pekanbaru Municipality have rights to acsses into the SIPKD in every SKPD in Pekanbaru Municipality to get the financial information from each SKPD so the submission of the local finance report no longer needs to ask the employee from each SKPD to come to BPKAD to submit the report. Complete menu availability of SIPKD and also the Custom Report menu which is help the BPKAD to make a financial report according to the government needs and also based on the Local Regulation and the Major of Pekanbaru Regulation. By the existency of SIPKD, the delays on the local finance report delivery has been reduced.

21 3. The obstacles faced by BPKAD Pekanbaru Municipality in implementing SIPKD application are not in the system, but more on the apparatus resources who have different capability in face the regulation change, also the ability on absorbing information about the newest version of the SIPKD application. This condition affects on the differences in finance statements. Besides, there is also obstacle in the supporting hardware used by BPKAD to operate SIPKD, in which it still needs regular inspection and upgrade on the hardware access capability to run the SIPKD application. Moreover, there is also obstacle related to the network which sometimes stalled. 3.2 Suggestions The SIPKD Application in BPKAD Pekanbaru Municipality has run less effective, there are still some minor obstacles that should be observed. After conducting the research done by the writer and based on the conclusions that have been described previously, the writer comes to the suggestions, they are: 1. The government should increase the capacity of transmitting tower spreaded evenly in Pekanbaru Municipality in order to be able to carry the system operation without disturbance or long loading. 2. Recruit the honoraries to be the operators of SIPKD. The recruitment done by paying attention to the correlation of honoraries educational background and SIPKD operation. So, the obstacle of the lack competence of apparatus resources can be overcame. Besides that, the government should conduct periodic training to keep sharpen the ability of SIPKD operators in facing changes in applications that are related to the regulations. 3. Conduct hardware periodic checking to anticipate hardware damage because of heavy capacity of SIPKD application operation, and also perform maintenance for supporting hardware and software of the operation to run maximally. BIBLIOGRAPHY A. Books 1. Arikunto, Suharsimi Prosedur Penelitian Suatu Pendekatan Praktik. Jakarta : Rineka Cipta 2. Bangun, Wilson Manajemen Sumber Daya Manusia. Bandung : Erlangga 3. Danim, Sudarwan Motivasi Kepemimpinan dan Efektivitas Kelompok. Bengkulu : Rineka Cipta 4. Darise, Nurlan Pengelolaan Keuangan Daerah. Jakarta : Indeks 5. Gulo,W Metodologi Penelitian. Jakarta: Grasindo 6. Gondodiyoto, Santoyo Audit Sistem Informasi Pendekatan COBIT. Jakarta : Mitra Wacana Media 7. Halim,, Adul Akuntansi Keuangan Daerah. Jakarta : Salemba Empat 8. Hartono, Bambang Sistem Informasi Manajemen Berbasis Komputer. Jatinangor : A Harvard Business Review Paperback 9. Indrayani, Etin dan Gatiningsih Sistem Informasi Manajemen Pemerintahan (Sim)- Konsep Dan Aplikasinya Pada Organisasi

22 Pemerintahan/Pemda. Jatinangor : A Fifth 10. Jogiyanto, Hartono Anilisis dan Desain Sistem Informasi. Yogyakarta : Andi Offset Anilisis dan Desain Sistem Informasi. Yogyakarta : Andi Offset 12. Kumorotomo, Wahyudi Sistem Informasi Manajemen dalam Organisasi-Organisasi Publik. Yogyakarta : Gadjah Mada University Press 13. Kurniawan, Agung Transformasi Pelayanan Publik. Jakarta : PT. Gramedia Pustaka Utama 14. L.Gaol, Chr.Jimmy Sistem Informasi Manajemen. Jakarta : PT. Gramedia Widiasarana Indonesia 15. Mahmudi Manajemen Keuangan Daerah. Jakarta : Erlangga 16. Mamesah, Sistem Administrasi Keuangan Negara. Jakarta : PT. Gramedia Pustaka Utama 17. Mardiasmo Otonomi dan Manajemen Keuangan Daerah. Yogyakarta : Andi 18. Marimin Sistem Informasi Manajemen. Bogor : Grasindo 19. Moleong, Lexy J Metodologi Penelitian Kualitatif. Bandung : Remaja Rosdakarya 20. Mukhtar, A.M Audit Sistem Informasi. Jakarta : Rineka Cipta 21. Nazir, Moh Metode Penelitian. Jakarta: Ghalia Indonesia Metode Penelitian. Bogor : Ghalia Indonesia 23. Nugroho, Eko Sistem Informasi Manajemen. Yogyakarta : 24. Andi Yogyakarta 25. Sholeh,Chabib dkk Administrasi Keuangan Daerah. Jatinangor : Institut Pemerintahan Dalam Negeri 26. Siagian, Sondang P Manajemen Sumberdaya Manusia. Jakarta : Bumi Aksara 27. Sugiyono Metode Penelitian Pendidikan Pendekatan Kuantitatif, Kualitatif, dan R&D. Bandung : Alfabeta 28. Surlasumantri, Jujun.S Filsafat Ilmu. Jakarta: Pustaka Sinar Harapan 29. Sutanta, Edhy Sistem Informasi Manajemen. Yogyakarta : Graha Ilmu 30. Widi, Restu Kartiko Metodologi Penelitian. Yogyakarta : Graha Ilmu 31. Yakub Pengantar Sistem Informasi. Yogyakarta : Graha Ilmu 32. Yani, Ahmad Hubungan Keuangan Antara Pemerintah Pusat dan Daerah di Indonesia. Jakarta : Rajawali Pos B. Legislations 1. Law No. 25 Year 1999 about Finance Balance of Central and Local Government 2. Law No. 33 Year 2004 about Alteration of Law No. 25 Year 1999 about Finance Balance of Central and Local Government 3. Government Regulation No. 105 Year 2000 about Local Finance Management and Accountability 4. Government Regulation No. 56 Year 2005 about Local Finance Information System 5. Government Regulation No. 58 Year 2005 about Local Finance Management 6. Government Regulation No. 71 Year 2010 about Government Accounting Standards 7. The Regulation of the Minister of Home Affairs No. 13 Year 2006 about Local Finance Management Guidelines 8. The Local Regulation of Pekanbaru Municipality No. 6 Year 2004 about Local Finance Management Principles C. Other Sources 1. Redaktur. Sistem Informasi Pengelolaan Keuangan Daerah, 2. ormasi_pengelolaan_keuangan_daer ah accessed on September 2, 2014