Ramses Pakpahan & Etty Murwaningsari
The goal of this research is to determine how asset management and audit quality impact the public services quality with financial reporting quality as an intervening variable, in the context of developing an accural-based accounting system in Indonesian local governments. The Partial Least Squares-SmartPLS analytic approach is employed in this study, which comprises 1,828 observations from 457 district and municipal administrations in Indonesia from 2015 to 2018. The findings demonstrate this. The first is that asset management has a positive and significant effect on the financial reporting quality; the second is that audit quality has a positive and significant effect on the financial reporting quality; the third is that asset management has no long-term impact on the public service quality; and the fourth is that audit quality has a positive and significant impact on the public service quality. Fifth, financial reporting quality can help to mediate the impact of asset management on the quality of government services. Sixth, financial reporting quality can help to mediate the impact of audit quality on the public service quality. The study's findings suggest that local governments improve management to aid regional development, as well as streamline the role of internal auditors in completing follow-up audit recommendations and assisting external auditors in the audit process, in order to produce effective and constructive recommendations. One of the research's flaws is that it does not sufficiently analyze the public service quality as well as accounting and auditing. This study adds to our understanding of the link between asset management and audit quality in the context of an accrual-based accounting system and public service quality.