External Auditing and Government Accountability in Indonesia Through Supreme Audit Board

Abstract

Government accountability is the central pillar of transparent and responsible public governance. Within the framework of agency theory, the government acts as an agent mandated by the public (principal) to manage public resources on their behalf. This study aims to examine the relationship between government accountability, external auditing, and the role of the Supreme Audit Board as an independent institution ensuring transparency in state financial management. A literature-based approach is employed by reviewing studies published within the past five years that focus on the effectiveness of public auditing and the agency–principal relationship in Indonesia’s public sector. The findings indicate that external audits conducted by Supreme Audit Board enhance public trust, reduce information asymmetry, and strengthen control mechanisms against potential moral hazards in public fund management. High-quality audits serve as a crucial instrument for maintaining integrity and improving the performance of governmental institutions. Thus, public accountability can be achieved through effective collaboration between independent auditors and the government as a public agent.