The Influence of Financial Literacy, Risk Management, and Financial Management on the Quality of Local Government Financial Reports with Compliance Audit as a Moderating Variable (Survey at Tasikmalaya Regency Local Government)

Siti Namira Arifah; Dedi Kusmayadi; Iwan Wisandani

doi:https://doi.cibangsa.org/DOI-2026-137

Authors

Siti Namira Arifah Master of Management Study Program, Postgraduate Program, Siliwangi University, Tasikmalaya, West Java, Indonesia Author
Dedi Kusmayadi Master of Management Study Program, Postgraduate Program, Siliwangi University, Tasikmalaya, West Java, Indonesia Author
Iwan Wisandani Siliwangi University, Tasikmalaya, West Java, Indonesia Author

DOI:

https://doi.cibangsa.org/DOI-2026-137

Keywords:

Financial Literacy, Risk Management, Financial Management, Financial Report Quality, Compliance Audit

Abstract

This study aims to analyze the influence of Financial Literacy, Risk Management, and Financial Management on the Quality of Local Government Financial Reports, as well as the moderating role of Compliance Audit in those relationships. This research used a quantitative survey approach. The population comprised all financial management apparatus (ASN) in the Local Government of Tasikmalaya Regency, with 177 respondents selected through purposive sampling across 59 regional work units. Data were analyzed using Structural Equation Modeling-Partial Least Square (SEM-PLS) with SmartPLS 4.0 software. The results indicate that: (1) Financial Literacy has a positive and significant effect on the Quality of Financial Reports (β = 0.406; t = 6.944; p = 0.000); (2) Risk Management has a positive and significant effect on the Quality of Financial Reports (β = 0.318; t = 4.590; p = 0.000); (3) Financial Management has a positive and significant effect on the Quality of Financial Reports (β = 0.218; t = 4.072; p = 0.000); (4) Compliance Audit significantly moderates the relationship between Financial Literacy and Financial Report Quality (β = 0.165; t = 2.557; p = 0.011); (5) Compliance Audit does not moderate the relationship between Risk Management and Financial Report Quality (β = -0.010; t = 0.186; p = 0.853); and (6) Compliance Audit significantly moderates the relationship between Financial Management and Financial Report Quality (β = 0.202; t = 3.895; p = 0.000). These findings underscore the need for integrated strategies to strengthen human resource competency, internal control systems, and compliance oversight to improve local government financial reporting quality.

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