DIGITALIZATION OF FINANCIAL REPORTING AS A DETERMINANT OFSME FINANCIAL STATEMENT QUALITY: EVIDENCE FROM BANYUMAS REGENCY

Abstract

This study aims to analyze the effect of financial statement digitalization on the quality of financial reports among Small and Medium Enterprises (SMEs) in Banyumas Regency. The rapid advancement of information technology has encouraged SME owners to adopt digital systems in recording and preparing financial statements in order to enhance the effectiveness, efficiency, and accuracy of financial information. However, SMEs still encounter several challenges, including limited accounting knowledge and low utilization of digital technology.

This research employed a quantitative approach using a survey method through the distribution of questionnaires to 100 SME owners in Banyumas Regency, selected using the Slovin formula. The data analysis techniques included validity and reliability tests, classical assumption tests, and multiple linear regression analysis using SPSS version 20.

The findings reveal that the digitalization of financial statements has a positive and significant effect on the quality of SME financial reports. This result is evidenced by a regression coefficient value of 0.430 and a calculated t-value of 2.544, which is higher than the t-table value of 1.980. Furthermore, the coefficient of determination (R²) value of 0.763 indicates that the digitalization of financial statements explains 76.3% of the variance in the quality of SME financial reports.

Therefore, the better the implementation of financial statement digitalization, the higher the quality of SME financial reporting. This study is expected to serve as a reference for SME owners in improving their capabilities and utilization of digital technology in financial management practices.