Julius Tamawiwy, Jullie J. Sondakh, Jessy D.L Warongan
The main objective of regional autonomy is to improve public services and promote the local economy in Indonesia. Capital expenditures for public services is used to finance expenditure in investing activities (add assets) aimed at improving public infrastructure that results can be used directly by the public. Developed regions tend to maintain the structure of expenditure into maintenance expenditure. The shift in spending patterns in the local government often triggered concerns about the extent to which the amount of local revenue affects the pattern of local government spending, especially capital expenditure for public services. This study purposes to analyze growth of revenue (PAD), the ​​fiscal decentralization, financial effectiveness and efficiency of the Local Government Financial Management to the capital expenditure for public services. The method used is quantitative method with a sampling technique using judgment sampling which took samples with consideration of the availability of data in the Local Government Financial Statements Reports in the Province of North Sulawesi by 10 districts/cities of Local Government in North Sulawesi since 2010 to 2015. The analytical method used is a multiple regression using SPSS 20 application assistance. The results show that PAD growth is effect as positive and significant capital expenditures for public services, fiscal decentralization is negative effect and not significant toward capital expenditures for public services, effectiveness and efficiency of local financial is effect as positive but not significant toward capital expenditures for public services..
This study aims to determine the factors that determine the Local Government Finance Accountability Reporting. Variabel Government Accountability Financial Reporting independently used in this study is the Fiscal Decentralization measured using Local Self-Reliance, Reliance Regions, the performance is measured using the ratio Effectiveness, Operational Expenditure Ratio, Ratio Shopping Capital and Regional Status. The dependent variable used in this study is the Local Government Finance Accountability Reporting measured using BPK Audit Report on the Financial Statements of Local Government in the form of an audit opinion. The samples were all over the city / regency in Central Java province with the study period between 2011-2013. Data were collected using purposive sampling. Based on these criteria, the total of 35 city / county elected as the population in this study. The analytical tool used is path analysis with SPSS version 16.0 Results of the study found that there is a significant positive effect between the Regional Autonomy and Accountability Financial Reporting Regions. Dependence area does not have a significant impact on Regions Financial Reporting Accountability. The effectiveness of significant negative effect on the Local Government Finance Accountability Reporting. Operating expenditure does not have a significant impact on Regions Financial Reporting Accountability. Capital spending has a significant positive effect on Regions Financial Reporting Accountability. Regional Status significant negative effect on Regions Financial Reporting Accountability. From the findings, we can conclude that the Regional Addiction and capital expenditures are a significant positive effect on Regions Financial Reporting Accountability. Regional and Operational Expenditure dependence there is no significant effect on the Local Government Financial Reporting Accountability however Effectiveness and Regional Status has a significant negative effect on Regions Financial Reporting Accountability.
Recently, fiscal decentralization, which involves the devolution of government fiscal responsibilities to lower levels of government, has been discussed in many developed and developing countries. In particular, the effect of fiscal decentralization on economic growth is a key issue in recent theoretical and empirical studies in public finance. The empirical evidences produce mixed results. In this study, the effect of fiscal decentralization on economic growth in a sample of several provinces will be explored. A province study offers several advantages: a bigger sample of data is available for province than for Indonesia; and panel data estimation is able to adjust the cultural, historical, and institutional differences and also to capture the local heterogeneities. By adopting a production-function-based estimation framework, the empirical estimation is done on a sample of cross section data that comprises of 26 province governments and the time series yearly data from 1992 to 2002. The Generalized Least Square method is used to test these data. The results indicate that: first, the fiscal decentralization variables (expenditure indicator) show the positive and significant coefficients, while, the revenue indicator shows the negative relationship with economic growth. Hence, several policy implications can be derived; i.e, the local government should be able: to increase their non taxes revenues; to create conducive conditions for capital inflows; and to develop a clear framework for fiscal decentralization assignment such as income redistribution and borrowingJEL classification: E60; E62; H62; H63; 04Keywords: province government financing; fiscal decentralization;localautonomy;fiscal policy; economic growth; cross-province data;
The dichotomy between pay-as-you-go (taxation financing) and pay-as-you-use (debt financing) methods of financing municipal projects, etc, is the area of concern in this paper. While there arc advantaees and disadvantages to both forms, debt financing carries a considerable amount of baggage known as interest. Interest or usury has been a concern of economic and religious thinkers through the ages. Given the potentially negative effect this has on the debtor, Indonesia is forewarned as it decentralizes fiscal administration to local governments. Besides reliance on taxation financing, an alternative public debt option is highlighted.
This study aims to analyze the relationship between fiscal decentralization, fiscal capacity, financial independence and financial expenditure areas in achieving social justice. In this case, the East Java Province Indonesia is supported by the existence of local government district / municipality became the main object of study during 2010 -2014. The needed data are such as; financial balance data, regional revenue, the amount of local spending and social justice data on people's lives. Data analysis method used is Partial Least Square (PLS). The results provide the conclusion that the implementation of the fiscal decentralization policy gives positive and significant impact on local fiscal capacity. Fiscal capacity gives positive and significant impact on the local financial independence. Local financial independence gives positive and significant impact on the structure of the shopping area. The structure of local government spending has a significant effect on the achievement of social justice areas. In this case, the fiscal capacity and financial independence have no direct impact significantly on the achievement of social justice in the various districts / cities in East Java. In addition, this study also provides important conclusion that there is a significant indirect effect of fiscal decentralization on social justice through local fiscal capacity, local financial independence and the structure of local government spending.
<em>Since 2001</em><em> the</em><em> r</em><em>egional autonomy policies have </em><em>br</em><em>ou</em><em>g</em><em>ht</em><em> out</em><em> seven new provinces in Indonesia. Consequently, </em><em>they</em><em> require the central transfer budget to finance the delegated duties and authorities and the development programs in each province</em><em>.</em><em> Since its establishment until today, the fiscal capacity in seven provinces except Banten has not fulfilled the increase in local expenditure needs every year. It still much depends on the central transfer because the local revenue source like PAD is</em><em> very low</em><em>. This research uses a descriptive method-analysis by analyzing the secondary data relevant to the discussed topic and using the concept of fiscal capacity in the framework of the fiscal decentralization theory. The results of this qualitative research explain that the high fiscal capacity index (IKF) is obtained by </em><em>four </em><em>provinces those are Bangka Belitung, West Papua, Riau, and North Maluku, while the intermediate index is obtained by Banten, and the low fiscal capacity index is obtained by Gorontalo and West Sulawesi. Good fiscal capacity with high index does not guarantee that the poor population in the area will be reduced as West Papua and Riau which populations are still relatively large. Besides, Bantam with the very high PAD compared with six other provinces still has a large number of poor population of poor among seven provinces. But, overall the central transfer is recognized to be very helpful for the fiscal capacity of the seven new provinces above.</em><em></em>
As an implementation of decentralized development, village financial management (VFM) is a financing model in a way to closer the needs of development at the village level. Theoretically, the successful objectives achievement of this authority delegation is if VFM can be done efficiently and effectively. This study aimed to analyze these efficiency and effectiveness of VFM and analyze factors inhibiting. The results showed that 1) VFM in Asahan district has not implemented both efficiently and effectively that shown from the weak implementation of both good governance principles and continuous improvement and, 2) Factors inhibiting the efficiency and effectiveness of VFM are, (i) lack of musrenbang transparency specifically the quality of information, access to information, the transparency mechanism of information and the level of information disclosure, (ii) lack of budgeting transparency, in particular the level of information disclosure, access to information and quality of information, (iii) lack of supervision transparency in particular the level of transparency, information quality and information access, (iv) the weak of oversight participation, especially the satisfaction level of participation and involve the community, and (v) lack of monitoring accountability in particular public complaints mechanism, access to the audit report and the responsibility structure.
Abstract.This research aimed to analyze the financial performance of the District/ Municipality in Jambi Province and to determine the effect of financial performance either simultaneously or partially on capital expenditure. The data used in this research is a panel data comprising time series data is data in 2010 - 2013 and cross section data is data of 9 (nine) District and 2 (two) Municipality is located in the Province of Jambi. The analytical method used panel data regression analysis. The analysis showed that the financial performance of the District/ Municipality in Jambi Province is still relatively low as the PAD contribution to regional revenue is still small so transfer income still dominate the local revenue to finance most of the regional expenditure. The results of panel data regression using the Fixed Effect Model (FEM) showed that the financial performance simultaneously significant effect on capital expenditure allocation of the District/Municipality in Jambi Province from 2010 to 2013 and partially Ratio Degree of Decentralization significant positive effect on the allocation of capital expenditure. Financial dependency ratio, Financial Independence Ratio and the ratio degrees contributions public enterprises significant negative effect on capital expenditure . Effectiveness ratio of PAD does not significantly influence the allocation of capital expenditure.Keyword: Financial Performance, Decentralization, Financial Independence, Abstrak. Penelitian ini bertujuan untuk menganalisis kinerja keuangan Pemerintah Kabupaten/Kota di Provinsi Jambi dan untuk mengetahui pengaruh kinerja keuangan baik secara simultan maupun secara parsial terhadap alokasi belanja modal. Data yang digunakan dalam penelitian ini merupakan data panel yang terdiri dari data time series yaitu data tahun 2010 – tahun 2013 dan data cross section yaitu data 9 (sembilan) Kabupaten dan 2 (dua) Kota yang berada di Provinsi Jambi. Metode analisis yaitu analisis regresi data panel. Hasil analisis menunjukkan bahwa kinerja keuangan Kabupaten/Kota di Provinsi Jambi masih tergolong rendah. Hasil regresi data panel dengan menggunakan metode Fixed Effect Model (FEM) menunjukkan bahwa kinerja keuangan secara simultan berpengaruh signifikan terhadap alokasi belanja modal Kabupaten/Kota di Provinsi Jambi dari tahun 2010 sampai dengan tahun 2013 dan secara parsial Rasio Derajat Desentralisasi berpengaruh positif signifikan terhadap alokasi belanja modal. Rasio Ketergantungan Keuangan, Rasio Kemandirian Keuangan dan Rasio Derajat Kontribusi BUMD berpengaruh negatif signifikan terhadap alokasi belanja modal. Rasio Efektifitas PAD tidak berpengaruh signifikan terhadap alokasi belanja modal. Kata Kunci : Kinerja Keuangan, Desentralisasi, Ketergantungan Keuangan
Abstrac : In order to implement regional autonomy based on Law No. 22 of 1999, that the granting of autonomy to the local city / county is based on the principle of decentralization in the form of autonomy, real, and responsible. Granting authority on the basis of the principle of decentralization, causing all fields are left to local governments in the implementation of an autonomous basically become the authority and responsibility of local city and county governments fully, both concerning the determination of policy, planning, implementation, monitoring, control, and evaluation. This study aimed to describe the factors that affect the implementation of regional autonomy and decen-tralization in the provision of recommendations for the implementation of decentralization in au-tonomy. The results showed that there are four variables that can explain the performance of the implementation of decentralization in the regional autonomy in the city / county, namely managerial aspects, aspects of Human Resources organization, aspects of bureaucratic culture, and ethics of public service. Keyword: decentralization, regional autonomy
This paper examines decentralisation and distribution of access to primary school in Indonesia. Data come from Indonesia National Socio Economic Survey 2014, and statistic reports from Ministry of education, Ministry Of Finance, and General Election Commision. Descriptive statistic is used to describe spatial distribution of decentralization in primary education system and distribution of primary education access. The results show there are districts disparities in decentralization of primary education system and primary education access especially between district within Java islands and Papua islands. The results highlight the need to improving decentralization performance to achieve universal primary education in Indonesia, particularly within districts outside Java islands. Improving bureaucracy capacity particularly teachers is important to improve decentralization performance in primary school access.
The Indonesian government imposed a policy of regional autonomy with the aim to facilitate local governments regulate local affairs independently. Tangerang City is one of the areas that implement decentralization policy and requires a lot of funds to finance regional development. The biggest potential possessed Tangerang City in the financing of regional expenditures derived from local taxes and are expected to provide the largest contribution in PAD. This study aims to determine the effectiveness of tax collection hotels, restaurants, billboards and parking, and its contribution to the PAD Tangerang City. Methods of data analysis in this research is descriptive analysis. The variables in this study are the ratio of the effectiveness and contribution analysis. Data analysis technique in this study is a quantitative analysis. Based on the analysis, the average effective tax collection hotel, restaurant tax, advertisement tax and parking tax years 2010-2014 is very effective and the average contribution collection hotel, restaurant tax, advertisement tax and Tangerang city parking tax years 2010-2014 is lack.
The implementation of regional autonomy within the framework of decentralization is a complex and continuous work . In the early stages of decentralization , there is a transfer of various types of authority from the center to the various institutions , especially institutions subnational governments . After the transfer of authority will then be followed by the transfer of financing , documents and facilities . After the completion stages passed , does not mean the work has been completed . It appears a series of new challenges related to the ability of isntitusi who obtained the transfer of authority to manage it properly . Without good management , decentralization is precisely that for democracy , effectiveness , efficiency and fairness can not be achieved . It would appear the sources of inefficiency , ineffectiveness and new injustices in areas that can be a trigger for a second series of multidimensional crisis
This study is purposed to (1) determine the financial management performance of Keerom district, (2) effective and efficient in the financing the needs of the region. This research is a descriptive study describing and analyzing the data obtained. The object of this study is to measure the performance of financial management in Keerom district in terms of the ratio of financial independence area, Regional Financial Dependency Ratio, the ratio of fiscal decentralization, the effectiveness and efficiency ratios. Results of the analysis of the financial performance ratio in Keerom district in 2009-2013 shows that (1) the financial performance is not optimal yet in the implementation of regional autonomy, this is indicated by the indicator of financial performance, they are; Regional independence of Keerom district reached 3.22%, Regional Financial Dependence is very high towards the central government, it is reached 53.91%, and the Fiscal Decentralization is less, considering the financial dependence on the central government is very high at 16.44%. (2) effectiveness in managing local finance in Keerom district is Highly Effective since it reaches 95.11% and it needs to be maintained and improved, but the efficiency of financial management in this district shows the results of inefficient, it reaches 100.41%, then it needs special attention in order to avoid wastage in the use of finance to fund the development and the activity of other areas.
As a fiscal policy within the framework of regional autonomy, the allocation of DAU is an act that very important. It was meant to address financing capability gap between regions. The reason is because the DAU is the largest component of balance funds, namely the lack of 26% of the net domestic income in the state budget the amount of DAU scheme is not limiting, because it can only grow with the size of the authority delegated to the regions. DAU legal standing as a regional income in the financial relationship between the center and the regions based on the principle of autonomy is as a subsidy coming from the state revenue in the state budget that is allocated to local revenue in the budget based on fiscal decentralization. Keywords: General Allocation Fund, autonomy, regional autonomy
Abstrak Penelitian ini bertujuan untuk menganalisis bagaimana kemampuan pengelolaan keuangan daerah Kota Semarang dalam rangka mendukung pelaksanaan otonomi daerah. Sedangkan data yang digunakan dalam penelitian ini adalah Laporan Realisasi Anggaran Kota Semarang Periode 2009 -2013. Metode Penelitian ini menggunakan Deskriptif Komperatif analisisis untuk mengukur kinerja pengelolaan keuangan daerah dan tingkat kemandirian daerah Kota Semarang, yaitu Rasio Kemandirian Keuangan Daerah, Rasio Derajat Desentralisasi, Rasio Efektifitas PAD, dan Rasio Keserasian Belanja Daerah. Berdasarkan hasil analisis yang telah dilakukan diperoleh hasil sebagai berikut: hasil analisis rasio derajat desentralisasi dapat dijelaskan bahwa rata– rata rasio derajat desentralisasi sebesar 25,87% yang berada interval 25% –50% atau mempunyai kemampuan yang sudah baik dalam membiayai pembangunan daerah. Berdasarkan rasio KKD dengan rata – rata rasio KKD sebesar 37,79% berada pada interval 25% -50% berarti konsultatif artinya campur tangan pemerintah pusat sudah mulai berkurang, karena daerah dianggap sedikit lebih mampu melaksanakan otonomi daerah. Rata-rata Rasio Efektivitas PAD ³ 100%, berarti kemampuan daerah dalam menjalankan tugas dikategorikan sangat efektif itu menunjukan dalam memobilisasi penerimaan PAD sesuai dengan yang ditargetkan. Menurut uraian dan perhitungan Rasio Keserasian bahwa sebagian besar dana yang dimiliki pemerintah Kota Semarang diprioritaskan untuk belanja pembangunan sehingga belanja rutin masih relatif kecil. Kata Kunci : Kinerja Pengelolaan Keuangan Daerah, Tingkat Kemandirian Daerah Abstract This study aimed to analyze the effect the financial ability of Semarang City in order to support the implementation of regional autonomy, base on Semarang Budget Realization Reported the period of 2009 -2013. A descriptive comparative analysis used to measure the performance of regional financial management and the independence level of Semarang, consist of Regional Financial Independence Ratio, Degree of Decentralization Ratio, PAD effectiveness Ratio, and the Harmony Expenditure Ratio. Based on the analysis that has been obtained, the following results: from the analysis of the ratio of the degree of decentralization can be explained that the average ratio of the degree of decentralization is 25,87% of which is in the internal level of level 25%-50%, means already have a good ability to finance region development. Average KKD ratio is 37.79% which is in the interval 25 % -50 % means  that central government intervention has begun to decrease, because the region is considered a little more able to implement region autonomy. From the analysis of PAD effectiveness is more than 100%, it can be concluded that the overall performance of local financial management and the degree of independence of Semarang area continued to improve. It can be seen from some of the financial performance ratio is the ratio of the area of financial independence, the ratio of degrees desentralization, effectiveness ratio and the ratio continues to increase harmony and good effect on the autonomy of the region . Keywords: Region financial management performance, Degree of region decentralization
Giving local government to arrange regional receipt to purchase expenses bugget is part of Regional Otonomy. Not only depend on Central Government, Government genuine Receipt is one regional receipt that shows how stronger local goverment finance can handled all the expenditure. Metro as a local government in Indonesia, has the increase in regional otonomy espescialy in finance. The higher decentralization is a indicatoin that indicate higher ability on local government to fulfill all expenditure. It can be shown on share of Government Genuine Receipt and Tax and non Tax Share compare Total Regional Receipt and Total Regional Expenditure. Higher fiscal Desentralization needed by Metro to get higher Regional otonomy. Government Genuine Receipt and Tax and non Tax must be increased to get higher regional receipt and increasing share in Total Regional Receipt and higher share to offord the Total Regional Expenditure.
This research aims to understand the effect of policy implementation through Law No. 18 of /997 to the performance of local government finance. The case study is Pemalang regency. Contrary to the assumed policy goals, this research shovrs that during 2 years of its implementation in Pemalang the local original income (PAD) has virtually decreased. Although the nominal budget of the local government has increased, the PAD has contributed less. In effect, the policy has resulted in the decline of local government income from local taxation and charges, the overall fiscal effort and the degree of fiscal decentralization. It is recommended that the current policy problem should be addressed by determining the target of local taxes and charges with the real local potentials. The local government has to focus on the effective and efficient taxes that are linked to the local development budgets and the local gross domestic product.
<p class="Bodytext50"><em>Regional autonomy that has long been the aspiration of the people had been executed after successfully fought for reform. After implemented, which should be considered is whether the regional autonomy that has been running for 4 yaers really can fullfil people's needs and create welfare for the people. We all know that the purpose of the existence of local government is creating public service. Public services must be created with the creative way through many aspect include regional financial management strategies. By using four independent variables: financing ability, mobilize funds ability, regional government independence, level of fiscal decentralization, and the level of flaypa per effect, researcher tested the role of regional autonomy by linking it to the influence of these four independent variables on the variable of public service expenditure allocation. By using a chow test resulted in a finding that the local government system and the personnel in the four years of implementation of regional autonomy tend looks not ready in achieving the vision of regional autonomy. Anotherfinding is that in general, regional autonomy has a role in improving the influence of financial management aspects on the allocation of expenditure on public services.</em>
Indonesia has been implemented decentralization era since 2001 in order to increasing local empowerment and local capability. During this period central government gave a all of the authority to the local government excepted authority for the political, finance,national defence, justice and religion. Beside gave the authority to the local government, central government also gave the source of the financing to the local government to meet the money follows function principle. Financial stability is the most important things on the monetary area. Many theorytical background described that decentralization have relation with the local financial stability.Using statistic approach (panel data) we could be proved that decentralization have negative relation with the local financial stability and also the other variable such as population, GRDP, constriction price index and volatility of money
The Indonesian government imposed a policy of regional autonomy with the aim to facilitate local governments regulate local affairs independently. Denpasar City is one of the areas that implement decentralization policy and requires a lot of funds to finance local development. The biggest potential held in the Denpasar area of financing comes from tax expenditures hotels and restaurants and are expected to provide the largest contribution in the PAD. This study aims to determine the effectiveness of tax collection rate hotels and restaurants and their contribution to PAD Denpasar. Methods of data collection in this study is the observation nonparticipant. The variable in this study is the ratio of the effectiveness and contribution analysis. Data analysis in this study is a quantitative analysis. Based on the analysis, the average effective tax collection hotels and restaurants in the city of Denpasar years 2009-2013 amounted to 113.54 percent categorized as very effective, and the average contribution of tax revenue hotels and restaurants in the city of Denpasar in 2009 to 2013 by 32 , 27 percent of the category quite well.
<p>In the future, the urban area will be the area that gets more complex, covered by a variety of social, economic and environment arising from population growth in the region and in line with the dynamics of globalization, democratization and decentralization. The purposes of this study is to describe and analyze the dynamics of land use and growth in the area for 1 (one) a decade in Bandar Lampung.</p><p> This research is a descriptive study using documentation for secondary data obtained from the BPS at two (2) different time points (t0 and t1). The analysis model used to assess the focus of research using quantitative analysis <em>Location Quotient</em> (LQ) and <em>Shift-Share Analysis</em> (SSA).</p><p> The results showed that: (1) During a decade in Bandar Lampung has occurred the utilization land for industrial use; settlements and services were increasingly widespread. While the use of land that is not cultivated; swamps and forests tend to be diminishing at a rate; patterns and impact varied in each parts of the city; (2) For almost a decade of economic growth in Bandar Lampung supported by sectors of the economy outside agriculture and mining and quarrying. While in the long term competitiveness of economic growth in the city was supported by the agricultural sector; Non-oil processing industry; and finance, leasing and services company. And the third (3) factors of economic growth, population growth and government policy in the form of spatial planning as well as the entry into force of the market mechanism was a trigger factor that reflected changes in land use in urban areas.</p><p> The suggestions and recommendations as well as follow up on the policy implications that can be done in Bandar Lampung, including : changing the necessary incentives and dis-incentives policy in controlling land utilization, giving the opportunity cost that owned land resources, both economic and non -economic. Additionally, in efforts to achieve sustainable urban development, expansion of public access required in determining the allocation of land use and the provision of public space is increasingly widespread and qualified as a form of services provided by the municipality to citizens.</p>
Open access
Economic Growth and Fiscal Policies
Agriculture and Agroindustry Studies
Community-based Tourism Development and Sustainability
Ady Soejoto, Waspodo Tjipto Subroto, Suyanto Suyanto
Goal of this research is promoting human development in Indonesia through fiscal decentralization. In general, funds decentralization, economic growth, public expenditure, and a decline in total poor population in the autonomous region provide significant positive effect on human development index, thus increasing decentralization funds as balance grants to autonomous regions can be used to finance local expenditure, especially public social expenditure in education and health increased more years. Fiscal decentralization policy is instrumental in supporting the success of Indonesia&#039;s human development. In particular the research of fiscal decentralization policy yield in promoting human development as an economic overview of democracy in Indonesia counties and cities were assessed based on a review of theoretical and empirical can be concluded as follows: (1) Increased decentralization funds proven to provide significant positive effect on the amount of public expenditure. (2) Increased decentralization funds proved to have a positive effect on economic growth. (3) The increasing of total poor population in the autonomous region. (4) Regional economic growth is increased not provide significant effect on reducing total poor population. (5) Decentralized funds that transferred from central government to autonomous region proven to provide significant positive effect on human development index. (6) Economic growth provides significant positive effect on human development. (7) Public expenditure of autonomous regions provides significant positive effect on human development. (8) The decline in total poor population of autonomous region provide significant positive effect on human development. (9) In general decentralization funds policies have positive impacts on human development of each autonomous region counties and cities.
In the perspective of regulation, some basic things that needs attention is that the policy principles of financial balance, the basic local government funding, the source of local revenue, local revenue, the fund balance, miscellaneous revenue, borrowing, financial management in the context of decentralization, deconcentration funds, support funds, financial information systems area, as well as transitional provisions, must obtain a more serious concern. On the application of the dimensions of the Financial Balance between the Government and the Regional Government is a subsystem of the State Treasury as a consequence of the division of tasks between the Government and Local Government showed inconsistencies with the provision of financial resources of the state to the regional government in the implementation of decentralization. It is certainly a negative impact, because it is only based on the transfer of duty by the Government to the Local Government with regard stability and fiscal balance. Local finance should be managed in an orderly, obedient to laws and regulations, efficient, economical, effective, transparent and accountable with regard to fairness, decency, and the benefits to society. Keywords:State Financial Regulation,Relations Regional Center,Financial Decentralization