Digital Transformation of Local Government Accounting: An Exploration of Technology Adoption in Bitung City Government Financial Reporting

Abstract

Local governments in Indonesia are required to adopt the Regional Government Information System (SIPD), yet little is known about how it is used across organisational units. This qualitative case study of Bitung City Government integrates the Technology Acceptance Model and Institutional Theory, drawing on interviews with twelve informants from the Regional Finance and Asset Agency, the Health Office, and the Inspectorate, supplemented by passive observation. Adoption is layered: SIPD is integrated in budgeting and treasury administration but fragmented in accounting, asset management, and reporting, where companion applications, sectoral systems, and manual work fill the gaps. The central argument is that formal adoption is not the same as substantive use. Regulative pressure ensures formal use across all units in the core financial management modules, whereas perceived usefulness, ease of learning, and feature maturity help explain the depth of use and workarounds, and substantive competence contributes to the perceived accuracy of accounting data. Digital controls improve standardisation but do not by themselves improve substantive accounting quality. The study proposes a Layered Adoption Model with nine tentative propositions. The sustainability of mandatory adoption after coercive pressure is removed remains unresolved.