DIGITAL ACCOUNTING AND MSME FINANCIAL REPORTING QUALITY: DIGITAL APPLICATION BASED SAK EMKM IMPLEMENTATION AND THE POTENTIAL MODERATING ROLE OF BUSINESS AGE IN SERANG, INDONESIA

Esti Utami  Pratiwi; Resita Septia Rahma; Lisa Arisa

doi:10.61397/mfc.v4i2.600

Authors

Esti Utami Pratiwi Politeknik Piksi Input Serang
Resita Septia Rahma Politeknik Piksi Input Serang
Lisa Arisa Politeknik Piksi Input Serang

DOI:

https://doi.org/10.61397/mfc.v4i2.600

Keywords:

digital accounting; SAK EMKM; micro, small, and medium enterprises; financial reporting quality; business age; PLS-SEM

Abstract

This study examines the association between digital-application-based implementation of the Indonesian Financial Accounting Standards for Micro, Small, and Medium Entities (SAK EMKM) and MSME financial reporting quality in Serang, Indonesia. It also examines whether business age moderates this association. An explanatory cross-sectional survey was administered online. Of 114 submissions, five duplicate entries were removed and 54 non-users of digital accounting applications were excluded, leaving 56 eligible respondents for the direct-effect analysis. Seven invalid business-age responses were excluded from the moderation analysis, resulting in n = 49. The data were analyzed using partial least squares structural equation modeling (PLS-SEM) with 5,000 bootstrap resamples. Digital-application-based SAK EMKM implementation was positively associated with the retained measure of financial reporting quality (β = .628, t = 4.77, p < .001; f² = .652), with R² = .395 (n = 56). The interaction between implementation and business age was negative but did not reach the conventional 5% significance threshold (β = −.171, t = −1.69, p = .091; ΔR² = .043; n = 49). Thus, the direct association is supported, whereas the moderation hypothesis is not supported at α = .05. The study distinguishes digital accounting application use from demonstrated conformity with SAK EMKM and investigates business age as a potential contingency factor. Digital accounting training should be combined with accounting-standard literacy and guidance on reviewing system-generated reports.

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