The Influence of Intergovernmental Transfer Funds and Regional Expenditure on Regional Financial Performance with Local Own-Source Revenue as a Moderating Variable in Central Sulawesi Province
William Indra S. Mooduto(1*), Muliyani Mahmud (2)

1) Public Sector Accounting Department, Faculty of Goverment and Public Sector, Bina Mandiri Gorontalo University
*Email: willsmood[at]ubmg.ac.id
2) Accounting Department, Faculty of Economics and Bussiness, Gorontalo State University

Abstract

This research analyzes the influence of Intergovernmental Transfer Funds and regional expenditure on regional financial performance, with Local Own-Source Revenue (PAD) as a moderating variable, in Central Sulawesi Province. Regional autonomy demands local governments manage finances effectively to support development. Intergovernmental Transfer Funds from the central government, although aimed at reducing fiscal disparities, potentially increase dependence and decrease regional fiscal independence. Regional expenditure also plays a crucial role, where the efficiency of budget allocation determines financial performance. The research results indicate that regional financial performance does not solely depend on the amount of funds or expenditure, but rather on the effectiveness of budget management and utilization. PAD is proven to have a strategic role in moderating these influences, reducing dependence, and encouraging fiscal independence. Therefore, increasing local revenue capacity through PAD enhancement strategies is crucial to achieve independent, efficient financial management that supports sustainable regional development.

Keywords: Intergovernmental Transfer Funds, Regional Expenditure, Regional Financial Performance, Local Own-Source Revenue (PAD), Fiscal Independence, Regional Autonomy.

Topic: Accounting and Auditing