Accountability, Transparency, and the Quality of Local Government Financial Reports: A Systematic Literature Review

Abstract

The quality of local government financial reports represents an important measure of good governance. Among the key factors shaping report quality are accountability and transparency, which influence accuracy, timeliness, and compliance with accounting standards. Nonetheless, their effectiveness is often constrained by issues such as abuse of authority, weak internal controls, limited public financial literacy, and insufficient technological infrastructure. This study applies a Systematic Literature Review (SLR) to analyze how accountability and transparency affect the quality of financial reporting and to identify obstacles that hinder their implementation. The review shows consistent findings: accountability, through systematic monitoring and reporting, enhances compliance with accounting standards but is weakened by inadequate internal control mechanisms; transparency, through open disclosure and citizen participation, improves report reliability and fosters public trust, yet is challenged by low financial literacy and technological limitations. To strengthen these factors, governments are advised to improve oversight systems, promote financial literacy education, and invest in better information technology infrastructure. Future studies are encouraged to investigate context-specific strategies that can support more effective implementation of accountability and transparency in local government financial reporting.