LEX LOCALIS-JOURNAL OF LOCAL SELF-GOVERNMENT - 23 - 11 - What Drives Financial Management in Indonesian State Universities with Legal Entity Status (PTN BH), Evidence from Internal Oversight Units

Sep 10, 2026

Uploaded by Kyle

This study investigates determinants of financial management performance in Indonesian State Universities with Legal Entity Status (PTN BH), emphasizing internal control effectiveness, internal audit quality, auditor-auditee relationships, strategic planning, mission clarity, and organizational ethical culture, with top management commitment as a moderating factor. A quantitative survey of Internal Audit Units (SPI) across all PTN BH is analyzed using PLS-SEM. Findings indicate audit quality, relationships, strategic planning, mission clarity, and ethical culture significantly enhance performance, while internal control shows no direct effect.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages23

Reading Time58 min

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Abstract

Introduction

LEX LOCALIS-JOURNAL OF LOCAL SELF-GOVERNMENT ISSN:1581-5374 E-ISSN:1855-363X VOL. 23, NO. 11(2025) WHAT DRIVES FINANCIAL MANAGEMENT IN INDONESIAN STATE UNIVERSITIES WITH LEGAL ENTITY STATUS (PTN BH)? EVIDENCE FROM INTERNAL OVERSIGHT UNITS Raya Puspita Sari Hasibuan1, Fahmi Natigor Nasution2, Rina Br Bukit3, Robert Sibarani4 1,2,3,4Departement of Accounting, Universitas Sumatera Utara, Faculty of Economics and Business, Medan, Indonesia 4Departement of linguistic, Universitas Sumatera Utara, Faculty of Economics and Business, Medan, Indonesia [rayapuspita@students.usu.ac.id](rayapuspita@students.usu.ac.id1)[1](rayapuspita@students.usu.ac.id1) [fahmi.natigor@usu.ac.id](fahmi.natigor@usu.ac.id2)[2](fahmi.natigor@usu.ac.id2) [rina.bukit@usu.ac.id](rina.bukit@usu.ac.id3)[3](rina.bukit@usu.ac.id3) [rs.sibarani@usu.ac.id](rs.sibarani@usu.ac.id4)[4](rs.sibarani@usu.ac.id4) Abstract This study examines the determinants of financial management performance in Indonesian State Universities with Legal Entity Status (PTN BH), focusing on internal control effectiveness, internal audit quality, auditor-auditee relationships, strategic planning, clarity of mission, and organizational ethical culture, with top management commitment as a moderating factor. Using a quantitative survey of Internal Audit Units (SPI) across all PTN BH, data were analyzed through PLS-SEM. Results show that audit quality, auditor-auditee relationships, strategic planning, mission clarity, and ethical culture significantly improve financial management performance, while internal control has no direct effect. Top management commitment strengthens the impact of audit quality, relationships, and ethical culture but is insignificant for other variables. Theoretically, the study integrates Institutional Theory, the COSO Framework, Goal Setting Theory, and Attribution Theory in public higher education governance. Practically, it highlights strengthening SPI, fostering ethical culture, implementing strategic planning, and ensuring management support to achieve accountability and sustainability in PTN BH financial management. Keywords: Financial Management Performance, Internal Audit, Ethical Culture, Top Management Commitment, PTN BH 1 Introduction State Universities with Legal Entity Status (PTN BH) in Indonesia, currently numbering 23 institutions, are designed as higher education entities with greater autonomy in academic, financial, and other resource management. The granting of this legal status is expected to strengthen the institutions' capacity to improve the quality of education, deepen research activities, expand cooperation, and accelerate the commercialization of innovation. This autonomy also allows for greater flexibility in financial management, including diversification of revenue sources through community funds, industry collaboration, and campus business units (Paino et al., 2015) , (Nguyen & Dang, 2022) ,(Asif et al., 2022) . However, this flexibility simultaneously increases management complexity, broadens the spectrum of risks, and demands transparent, accountable, efficient, and regulation-compliant financial management. In this context, financial management performance serves as the primary benchmark reflecting PTN BH's ability to optimize resource utilization while maintaining public credibility (Sîrb & Oana, 2015), (Suleiman & Dandago, 2014) . The Internal Audit Unit (SPI) plays a key role as the front line of supervision within PTN BH. This unit is responsible for ensuring that all financial processes comply with regulations, minimizing the risk of irregularities, and strengthening the reliability of financial reports and internal control systems (Jean et al. , 2022) , (Ahmi et al. , 2014) . Although the regulatory framework governing the SPI is uniform, in reality, the LEX LOCALIS-JOURNAL OF LOCAL SELF-GOVERNMENT ISSN:1581-5374 E-ISSN:1855-363X VOL. 23, NO. 11(2025) capacity, role, and effectiveness of the S

FAQs

Which factors significantly improve financial management performance in PTN BH?

Audit quality, auditor-auditee relationships, strategic planning, mission clarity, and organizational ethical culture significantly improve financial management performance.

Does internal control have a direct effect on financial management performance?

No. Results show internal control has no direct effect on financial management performance.

How does top management commitment influence the studied relationships?

Top management commitment strengthens the impact of audit quality, auditor-auditee relationships, and ethical culture, but it is insignificant for the other variables.

Sep 10, 2026

Uploaded by Kyle