Improving Heritage Asset Accountability: The Role Of Quantitative Disclosure In Local Government Financial Reporting In Java (2023-2024)

Abstract

Heritage assets embody cultural and historical values preserved for public benefit rather than economic gain, creating unique challenges for financial reporting in the public sector. Both international and national accounting standards, such as IPSAS 17 and Indonesia’s PSAP 07 permit these assets to be recognized at a nominal value (Rp0), provided that governments present adequate non-monetary disclosures. This study evaluates the quality of heritage asset disclosures in the Notes to the Financial Statements (CaLK) of provincial, regency, and city governments across Java for fiscal years 2022 and 2023. Employing a quantified content analysis approach, the study develops a Heritage Asset Disclosure Quality Index (DQI) comprising four dimensions: descriptive detail, quantitative reporting, maintenance and preservation information, and clarity of accounting policies. The results show that although most local governments acknowledge the existence of heritage assets, the depth and comprehensiveness of disclosures vary substantially. Descriptive narratives are commonly presented, but detailed quantitative information and disclosures related to preservation expenditures remain limited. Regression analysis further reveals that fiscal capacity and administrative level significantly affect disclosure quality, supporting the stewardship accountability perspective. These findings highlight the need for more explicit reporting guidance and strengthened institutional capacity to enhance transparency and improve the stewardship of cultural heritage.