FACTORS INFLUENCING AUDITEE SATISFACTION ON VILLAGE OFFICIALS IN THE PERFORMANCE OF INSPECTORATE AUDITORS IN BANTAENG REGENCY

I J A B E R, Vol. 13, No. 5, (2015): 2903-2911 FACTORS INFLUENCING AUDITEE SATISFACTION ON VILLAGE OFFICIALS IN THE PERFORMANCE OF INSPECTORATE AUDITORS IN BANTAENG REGENCY Mediaty 1, Basri Hasanudin 1 and Herni 2 Abstract: Village Allocation Fund, hereinafter referred to as ADD, is the balance of funds received by the district/city in the State Revenue and Expenditure district/city after deducting the Special Allocation Fund. This study aims to analize the factors influencing auditee satisfaction among village officials. The research objects were village officials in Bantaeng regency. This empirical study used the purposive sampling technique in the data collection. It also used the quantitative approach. The data were obtained by distributing questionnaires to 138 heads of village and other village officials. The response rate was 70.29% (97 questionnaires) and the usable response rate was 68.11% (94 questionnaires). The analysis was conducted using the multiple linear regression method with SPSS 20.0. The results reveal that: (1) the experience of audit team does not have significant influence on auditee satisfaction among the village officials; (2) understanding about villageenvironment does not have significant influence on auditee satisfaction among the village officials; (3) responsiveness towards the needs of village officials; (4) conducting examination based on audit common standards does not have significant influence on auditee satisfaction among the village officials; and (5) the involvement of the head of audit team does not have significant influence on auditee satisfaction among the village officials. Keywords: experience, understanding, rensponsive, satisfaction on village officials, performance of inspectorate 1. INTRODUCTION Village Funds Allocation, hereinafter abbreviated as VAD, is an equalization fund received by the district/city in the Regional Government Budget of a district/city after being deducted from the Special Allocation Funds. According to Law No. 6 of 2014 article 72 paragraph 4 about villages that the Village Funds Allocation is at least 10% (ten percent) of the balance funds received by the District/City in the Regional Government Budget after being deducted from the Special Allocation Funds. From the funds, it may rise any concern from the government and the society for a potency of diversion of the received funds. Internal supervision by the government is one of the essential functions of government management in order to realize a good, efficient, effective, clean and responsible governance. * Faculty of Economic and Business, University of Hasanuddin, Makassar, Indonesia ** Inspektorat Kabupaten Bantaeng, Indonesia

2904 Mediaty, Basri Hasanudin and Herni According to Regional Regulation No. 27 Year 2007 of Bantaeng District on the Ferment of the Organization, Position, Duty and Function of the Regional Technical Institute of Bantaeng. Bantaeng District Inspectorate is an element of Regional Government Supervision. Bantaeng District Inspectorate has the task of monitoring the implementation of government affairs in the region, the implementation of coaching on village governance and the implementation of village government affairs. The government allocated its budget for the village funds up to 20 Trillion Rupiahs in the Draft of the Amendment of State Budget of 2015. It is increasing for Rp 11 Trillion from the previous budget which only included the village funds for 9 trillion Rupiahs. The village funds allocation is based on the Law No. 6 of 2014 on villages. Within the law, the village funds allocation is 10 percent of the total funds transferred to the regions. In line with the government s plan, the authors considers that it should inspects the auditee satisfaction on the audit of the village administration inspectorate s performance as a preparation for the implementation of these regulations, in order to see how satisfied the village administration on the results of monitoring all the time, so that it is possible to make a better change. This study refers to some previous research related to the auditee satisfaction, that is Carcello, et al., (1992), finds that the obedient to the common standards and the involvement of the leader of KAP affects the auditee satisfaction. Samelson, et al., (2006) states that the experience of the audit team is responsive to the needs of the institutions and affects to the auditee satisfaction. Meanwhile, Zawitry (2009) finds that the audit team s understanding of the village environment and the involvement of the audit team leader affect the auditee satisfaction of village government. This study aims at analyzing the factors which affect the auditee satisfaction on village government. 2. MATERIALS AND METHODS Location and Design Research The unit of analysis in this research was conducted at the level of villages. It is a quantitative research. According to the purpose of the type of this research, it is an explanatory research. The consideration of the type is to analyze the causality relationship among the factors influencing the auditee satisfaction of village government. The research was conducted in 46 villages in Bantaeng District. Population and Sample The population of this study is all village governments which is predicted about 460 people in 46 villages in Bantaeng District. The total sample is 138 respondents. The sample is based on certain criteria, such as, the parties who have the most

Factors Influencing Auditee Satisfaction on Village Officials in the Performance... 2905 frequently communication with the team of the inspectorate. The sampling technique used in this research is purposive sampling. Data Collection There are five independent variables and a dependent variable in this research. The independent variables consist of: (1) Experiences of the audit team measured a by fairly-experienced team leader, the team leader has enough experiences, team members are experienced (Carcello et al., 1992). (2) The understanding of the village environment measured by the audit team leader inspectorate who acts as a responsible person for the financial audit, who has recognized expertise in a professional manner for governmental accounting, the auditing team of the inspectorates which carry out the financial audit can be said to have an expertise in accounting and auditing, the team audit of the inspectorates which carry out the audit to understand common accounting principles related to the audited village, the leader of the audit team and the audit team members of the inspectorate have common knowledge about village environment, the audited programs and activities (objects of inspection), the audit team of the inspectorate which has audited on some village governments (Carcello et al., 1992). (3) Be responsive to the needs of village government which is measured by the audit team inspectorate which may agree to complete the audit according to the time specified, the audit team of the inspectorate has skills in giving consideration accounting generally acceptable for a transaction to give some illustration, which must be conducted in the village fund, the audit team of the inspectorate which conducts the financial audit understands the generally accepted accounting principles related to the inspected village, the audit team of the inspectorate understands the activities of the village headman/secretary and its treasurer, the audit team of inspectorate only contacts them when there is an urgent needs (Carcello et al., 1992). (4) Carrying out the inspection based on a common standard audit as measured by the members of the audit team inspectorate who are under the leadership of the leader of the audit team of inspectorate may have stated to have professional skills to carry out the inspection, the audit team of inspectorate involved either directly or indirectly in activities of the object of inspection, such as providing the assistance, consulting service, system development, drafting and / or reviewing the inspection program, the audit team of inspectorate which perform an audit does not provide consulting services to the audited villages, the audit team members of inspectorate found to be negligent in a contrary lawsuit (Carcello et al., 1992). (5) The Involvement of the Leader of the Audit which is measured by the audit team leader of inspectorate visits the auditing place (means that it is not only the members of the audit team of inspectorate who are present when performing audit). The audit team leader of the inspectorate (who signed the audit letters) / the auditor leader seem to be actively involved from the planning stage, the process and until the signing of the final result, there are frequent communications between the leader of the audit

2906 Mediaty, Basri Hasanudin and Herni team of inspectorate and the village headman. The dependent variable is measured by the auditee satisfaction which you feel satisfied with all of the performance of the audit team of inspectorate as a team which audited your institution/village (Carcello et al., 1992). The data collection method was by using a questionnaire delivered by researcher. Data Analysis The recapitulated data was processed by using SPSS for Windows Version 20. The analysis tool used was the multiple regressions. There are five hypotheses in this study. Hypothesis testing was conducted by using the t-test. A common form of regression equation was formulated as follows: explanation: Y A 1-5 X 1 X 2 X 3 X 4 X 5 E = Satisfaction Auditee = Constants = The regression coefficient Y = + 1 X 1 + 2 X 2 + 3 X 3 + 4 X 4 + 5 X 5 + = The audit team experience variable = The understanding of the village environment = Responsive to the needs of the village government = Carrying out the appropriate inspection based on the common standard of auditing = The involvement of the Leader of the Audit Team = Other factors that influence the variable Y 3. RESEARCH RESULT Based on Table 1 of the multiple regression test results of the adjusted R Square of 0.218 indicates that it is 21.8% of the variation of the audit team experience variable (X1), Understanding the village environment (X2), Being responsive to the needs of the village government (X3), Carrying out the appropriate inspection based on the common standard of auditing (X4), The involvement of the Leader of the Audit Team (X5), and Auditee Satisfaction of the Village Government (Y), while 78.2% is explained by other factors outside the model. The test of H1, H2, H3, H4, and H5 were performed by t-test. The decisionmaking in hypotheses test are as follows: H0: if, t count < t table (n-k-1), partially, the independent variables do not significantly affect the dependent variable (Y).

Factors Influencing Auditee Satisfaction on Village Officials in the Performance... 2907 Ha: if t count > t table (n-k-1), the independent variables, partially, significantly affect the dependent variable (Y). H1 Test: The experiences of the audit team did not significantly affect the auditee satisfaction of the village government. According to the t-test, the variable of the human resources competences has a regression coefficient value of -0,002, then t count value of -0,034 and the significance level of 0,973. The t table value is determined by the significance level of 0,05 (Ghozali, 2006) with the degree of freedom (df = n-k-1 = 87) of 1,988. The analysis showed that t count < t table proves that Ha is rejected, reinforced by a significance value greater than p value (0,973 > 0,05). Based on the analysis of the audit team experiences variable (X1), the first hypothesis (H1) which states that The experience of the audit team affect the auditee satisfaction of the village government is rejected. H2 Test: The understanding of the village environment does not significantly affect the auditee satisfaction of village government. Based on the t-test, it was known that the variable of internal control system has a regression coefficient of 0,055, then the t count value of 1,051 and a significance level of 0,296. The t table value is determined based on a significance level of 0,05 with the degree of freedom (df = n-k-1 = 87) of 1,988. From the results of this analysis is known that t count > t table (1,051 > 1,988) shows that Ha is rejected. These results were confirmed by a significance value which is greater than p value (0,296 < 0,05). Based on the analysis for the understanding of the village environment variable (X2) then, the second hypothesis (H2) which states that The understanding of the village environment affects the auditee satisfaction of village government is rejected. H3 Test: Being responsive to the needs of village government significantly affects the satisfaction of the village government auditee. Based on the t-test result, it was found that the variable of being responsive to the needs of the village government has a regression coefficient value of 0,134, then the t count value of 2,317 and significance coefficient level of 0,023. The t table value is determined based on the degree of freedom (df = n-k-1 = 87) of 1,988. From the results of this analysis is known that t count > t table (2.317> 1.988) indicates that Ha is accepted. It is reinforced by significance value which is smaller than p value (0,023 < 0,005). Based on the analysis results, the third hypothesis (H3) which states that Being responsive to the needs of the village government affects the satisfaction of village government is accepted. H4 Test: Carrying out an audit based on the common auditing standards does not have significant effect on auditee satisfaction of village government. Based on the results of the t-test, it was found that the variable of Carrying out an audit based on the common auditing standards has a regression coefficient value of - 0,076 then the t count of -1,497 and the significance coefficient level of 0,138. The t table value is determined based on the degree of freedom (df = n-k-1 = 87) of 1,988.

2908 Mediaty, Basri Hasanudin and Herni From the analysis, it is known that t count < t table (-, 1,497 < 1,988) indicates that Ha is rejected. These results were confirmed by the significance value which is larger than the p value (0,138 > 0,005). Based on the analysis, the fourth hypothesis (H4) which states that Carrying out an audit based on the common auditing standards affects the auditee satisfaction of village government is rejected. H5 test: the involvement of the audit team leader does not significantly affect the auditee satisfaction of village government. Based on the t test results, it was found that the variable of the involvement of the audit team leader has a regression coefficient value of 0,067 then the t count value of 1,273 and the significance coefficient value of 0,206. The t table value is determined by the degree of freedom (df = n-k-1 = 87) of 1,988. From the analysis it is known that t count < t table (1,273 < 1,988) indicates that Ha is rejected. It is reinforced by the significance value which is larger than p value (0,206 > 0,005). Based on the results of the analysis, the fifth hypothesis (H5) which states that the involvement of the audit team leader affects the satisfaction of village government is rejected. Based on the data analysis, the regression equation form this research is: Y = + 1 X 1 + 2 X 2 + 3 X 3 + 4 X 4 + 5X5+ Y = 0,801-0,002X1+0,055X2+0,134X3-0,076X4+0.067X5+ 4. DISCUSSION The research found that The experiences of the audit team does not have a significant effect on the auditee satisfaction of the village government, The understanding on the village environment does not significantly affect the auditee satisfaction of the village government, Being responsive to the needs of village government significantly affects the auditee satisfaction of the village government temporarily, Carrying out an audit based on the common auditing standards and involvment of the audit team leader does not hava an effect on auditee satisfaction of the village government. Based on the results of the regression analysis, the coefficient of correlation between the experiences of the audit team with the village government auditee satisfaction with a significance value of 0,973 is greater than 0,05, indicates that the experiences of the audit team does not significantly affect the auditee satisfaction of the village government. This is due to the feeling of auditee satisfaction formed on the respondent of appraisal whether the audit team is experienced or not is ignored, because according to auditee of the village government that the more important is the smooth audit process, with no significant findings on their village. This finding is in contrast to the findings of previous research: Sriwati (2011), Yuniarti (2013), and Pasaribu (2014), which relate the attributes of audit quality and client satisfaction. Based on the results of the regression analysis, the coefficient of correlation between the understanding on the village environment with the village government

Factors Influencing Auditee Satisfaction on Village Officials in the Performance... 2909 auditee satisfaction with a significance value of 0.296 which is greater than 0.05 indicates that the experiences of the audit team does not significantly affect the auditee satisfaction of the village government. The understanding on the village environment does not significantly affect the auditee satisfaction of the village government since the auditee does not concern on the understanding of the audit team members on the audited village environment to form the auditee satisfaction. This finding is in contrast to the findings of previous research: Samelson et al. (2006), Yuniarti (2013), and Pasaribu (2014), which state that understanding the clients industries has a significant impact on clients satisfaction. Based on the results of the regression analysis, the correlation coefficient between being responsive to the needs of the village government with the village government auditee satisfaction is indicated by the significance value of 0,023 which indicates that there is a significant relationship between being responsive to the needs village government with the auditee satisfaction of the village government. This result proves that being responsive to the needs of the village government will determine the auditee satisfaction of the village government. This is in line with the theory of Parasuraman et al. (1985), the assessment of service quality can be done by understanding the needs of service users for audit engagement services. It is also in line with, Samelson et al. (2006), Yuniarti (2013), Leiwaskabessy (2013), and Pasaribu (2014), which in the previous research state that the auditors are flexible to the needs of schedule of the government which is an aspect that increases the auditee satisfaction. Based on the results of the regression analysis, the correlation coefficient between Carrying out an audit based on the common auditing standards with the auditee satisfaction of the village government indicated by the significance value of 0.138 indicates that there is no significant relationship between carrying out an audit based on the common auditing standard with the auditee satisfaction of the village government. Carrying out an audit based on the common auditing standards does not have a significant effect on auditee satisfaction of the village governments of Bantang District. This finding indicates that the auditee does not concern to the implementation of the auditee based on the common auditing standards to form the auditee satisfaction. This finding is in contrast with the findings of the following research (Fadhlurokhman 2009; Windasari 2010; Sriwati, 2011; Handayani, 2012; and Yuniarti, 2013). Based on the results of the regression analysis, the correlation coefficient between the involvement of the audit team leader with the village government auditee satisfaction is shown by the significance value of 0,206 which indicates

2910 Mediaty, Basri Hasanudin and Herni that there is no significant correlation between the involvement of the audit team leader with the auditee satisfaction of the village government. The involvement of the audit team leader does not significantly affect the auditee satisfaction of the village government, it indicates that the auditee in the village government does not concern to the involvement of the team leader to form the auditee satisfaction. For those who are not on anyone involved in the audit process that makes them satisfied, but rather the attitude shown by each member of the audit team, the discussion is related to the psychology of the respondents. 5. CONCLUSIONS AND SUGGESTIONS The experiences of the audit team does not have a significant effect on auditee satisfaction of the village government, The understanding on the village environment does not significantly affect the auditee satisfaction of the village government, Being responsive to the needs of village government significantly affects on the auditee satisfaction of the village government temporarily, Carrying out an audit based on the common auditing standards and The involvement of the audit team leader does not affect on the auditee satisfaction of the village government. The auditors should be more responsive to the needs of the auditee, have no contact outside of assignment schedules, should have better understand to the state of the auditee so that the auditee can provide the accurate data. it is also a criticism of the inspectorate, so that the provision of a letter of assignment to the audit team to provide the assignment schedule longer than before so that the audit can be conducted smoothly. References Carcello J. V., Hermanson. R. H., & McGrath. N. T. (1992), Audit Quality Attributes: The Perceptions of Audit Partners, Prepares, and Financial 147 Statement Users. Auditing: A Journal of Practice & Theory11, (Spring): 1-15. Fadhlurokhman (2009), Pengaruh Atribut-Atribut Kualitas Audit Terhadap Kepuasan klien. (In Indonesian) Sekolah Tinggi Ilmu Ekonomi Widya Manggala. Ghozali, I. (2006), Aplikasi Analisis Multivariate dengan Program SPSS. (In Indonesian) Badan Penerbit Universitas Diponegoro: Semarang. Handayani D. (2012), Analisis Faktor-Faktor Kepuasan Klien atas Kinerja Inspektorat Sebagai Auditor. (In Indonesian) Universitas Diponegoro. Herni. (2015), Faktor Faktor yang memengaruhi kepuasan auditee atas kinerja inspektorat sebagai auditor pada pemerintah Desa Kabupaten Bantaeng. (In Indonesian) Universitas Hasanudin. Leiwaskabessy F.F.T. (2013), Pengaruh Dimensi Kualitas Audit Terhadap Kepuasaan Auditee (Studi Pada Pemerintah Daerah Kota Ambon). (In Indonesian) Universitas Gajah Mada. Parasuraman, Zeithaml & Berry (1985), A Conceptual Model of Service Quality and Its Implications for Future Research. Journal of Marketing, Fall, pp. 41-50.

Factors Influencing Auditee Satisfaction on Village Officials in the Performance... 2911 Pasaribu R.A. (2014), Pengaruh Atribut Kualitas Audit Terhadap Kepuasan Klien (Studi Empiris Pada Bank Perkreditan Rakyat di Pekanbaru). (In Indonesian) Universitas Riau. Samelson D., Lowensohn S. & Johnson L.E. (2006), The Determinants of Perceived Audit Quality and Auditee Satisfaction in Local Government.Journal of Public Budgeting, Accounting & Financial Management, 18 (2): 139-166. Sriwati K. N. (2011), Faktor-faktor Penentu Kualitas Audit dan Kepuasan Auditee Persepsian di Pemerintah Daerah (Studi Kasus Pada Pemerintah Daerah istimewa Yogyakarta). (In Indonesian) Universitas Gajah Mada. Windasari S. P. (2010), Pengaruh Atribut Kualitas Audit Terhadap Kepuasan Klien. (In Indonesian) Universitas Diponegoro. Yuniarti R. (2013), Audit Quality Attributes and Audit Client Satisfaction. International Journal of Humanities and Management Sciences (IJHMS) Volume 1, Issue 1 (2013). Zawitry S. (2009), Analisis Faktor-Faktor Penentu Kualitas Audit yang dirasakan dan Kepuasan Klien di Pemerintah Daerah. (In Indonesian) Universitas Diponegoro. Appendix Table 1 Results of Multiple Regression Testing No Variable B Std. Error Beta T Sig. 1 The audit team experience -0.002 0.069-0.004-0.034 0.973 2 The understanding of the village 0.055 0.053 0.178 1.051 0.296 environment 3 Rensponsive to the needs of the 0.134 0.058 0.407 2.317 0.023 village government 4 Carrying out the appropriate -0.076 0.051-0.219-1.497 0.138 inspection based on the common standard of auditing 5 The involvement of the Leader of 0.067 0.052 0.152 1.273 0.206 the Audit Team Constants 0.801 Sig.F 0 Adjusted R Square 0.218 Source: Primary Data processed (2015)