Internal Control Systems Improve the Quality of Government Financial Reporting

Abstract

This study aims to analyze the influence of accountability, transparency, and internal control systems on the quality of financial statements in the public sector. The research employs a descriptive qualitative approach by reviewing various recent empirical studies relevant to the topic. Accountability and transparency play a crucial role in building public trust and ensuring that financial management is carried out efficiently and in accordance with the principles of good governance. Meanwhile, a strong internal control system contributes to preventing errors and fraud while ensuring compliance with applicable regulations. The synthesis of the literature indicates that these three variables are interrelated and mutually reinforcing in improving the quality of government financial statements. Public sector entities that demonstrate accountability and transparency, supported by an effective internal control mechanism, are more likely to produce financial reports that are reliable, relevant, and free from irregularities. These findings are expected to serve as a reference for policymakers in strengthening public financial governance that is both professional and integrity-driven. Strengthening these three aspects collectively can contribute to enhancing the credibility of public sector financial information and supporting better decision-making processes within governmental institutions.