Having obtained equation model of this research, the next will be tested by the influence of the Implementation on the Internal Audit Function (X1) and the Implementation of Good Corporate Governance (X2) on the Performance of Company (Y) in Bandung SOEs simultaneously. Form the hypothesis is as follows:
Ho: There is no influence of the Implementation of the Internal Audit Function and the Implementation of Good Corporate Governance on the Performance Company in the SOEs in the city of Bandung
H1: There is the influence of the Implementation of the Internal Audit Function and the Implementation of Good Corporate Governance on the Performance Company in the SOEs in the city of Bandung
From the test results (R-square value of Model Summary table) obtained the value of coefficient of determination (Зз) regression equation that is equal to 0.263. This means that any change in performance of the Company of 26.3% is affected by changes in the variable implementation of the Internal Audit Function and Implementation of Good Corporate Governance. The 73.7% influenced by other factors. To determine whether or not significantly influence the function of Internal Audit and the implementation of Good Corporate Governance ( 3) on the Performance of Company (Y) as a whole is to perform the F test with two-party testing in the 5% significance level (0.05). From the table 4.4 obtained values F that is equal to 5,177. To find out the price obtained F is significant or not, it should be compared with the value F_table. F_table value for n = 32 and k = 2 at 5% significance level is at 4,17. So that it can be seen that F_ > F_table. This means accepting 3 and reject 3?, means the Implementation of Internal Audit and Implementation of Good Corporate Governance have a significant impact on company performance.
From Table 4 above shows that the results obtained are significant or in other words the effect that there can be generalized to the entire population of the SOEs in the city of Bandung.
There are positive and significant impact of the implementation of the internal audit function and the implementation of good corporate governance on firm performance.
The method of this research use descriptive research. It used an explanation (explanatory research) with descriptive and verification method approach, because it explains the causal relationship between variables by testing the hypothesis. Data analysis in this research using multiple linear regression method.
In this research, the population is the states that have an internal auditor who was in Bandung. The unit of analysis in this research is the Company that has 34 SOEs contained in Bandung, only 15 SOEs which have an internal auditor found in Bandung, the rest position or function of the internal auditor at Jakarta.
The number of questionnaires that had spread as much as 65 copies in 12 SOEs that have Internal Audit in Bandung. The amount collected after completed by the respondents is 32 copies.
Some empirical evidence which shows that the implementation of Good Corporate Governance can improve firm performance in Yudha Pranata : Research conducted by Ashbaugh, et al. of 1500 companies in the United States, shows that companies that implement good corporate governance has increased the credit rating (credit rating firm) was significant, Alexakis et al. against the companies listing in the Greek capital market indicates that companies that are either fulfilling their corporate governance has increased the average stock return, and a significantly decreased risk, Drobetz, et al. against the companies listing in the German capital market indicates that companies that implement good corporate governance has increased the expected stock return that is significant, Firth et al. against the companies listing in Hong Kong stock market shows that companies that implement good corporate governance has increased the performance of the company (corporate performance) are significant. Similarly, a study conducted by Brown and Caylor
in Georgia, also show that companies that implement good corporate governance has increased the performance of the company (corporate performance) are significant. Research conducted by Cornett et al of companies incorporated in the S & P 100, also showed similar results where the companies that implement good corporate governance has a significant performance improvement company. Brown and Caylor showed that the implementation of good corporate governance can significantly improve the return on equity, net profit margin, Tobin’s Q. Research conducted Claessens, in Pallab Kumar and Md. Hamid that the implementation of better corporate governance will improve performance, more efficient management, better asset allocation, better employee, or other similar increase in efficiency. So it can be concluded that the application of basic principles of good corporate governance is essentially a goal to provide progress on the performance of a company.
According to Eric J. Williams today’s business world is undergoing phenomenal changes. Business conducted simultaneously in various countries and with many people, and the market is no longer limited by time zone boundaries. Role and skills required of Internal Auditors has become something important, The IIA clearly feel the necessity of the new global economic change, recognizing the need for an Internal Auditor to add value by utilizing their strengths to meet the needs of their organizations. However, the Internal Auditor in the future will look for opportunities to proactively adapt to changing business demands, not just reacting to them. To achieve this evolution, six focuses should be considered, as follows: Governance, Risk Management, eBusiness, fraud, outsourcing, and recruiting. This in the end the added value given by the Internal Auditor will improve company performance.
It also presented by Muh. Arief that the scope of audit activities more widely, at this moment is not merely a financial audit and compliance audits, but the attention devoted to all aspects affecting the performance of the company and management control as well as considering aspects risk business / management.
State-Owned Enterprises (SOEs) is required as the motor of the country’s economy. SOEs in Indonesia have not been able to work efficiently. From the audit report on the five state enterprises, the numbers of overall quantitative findings are losses due to inefficiency in Rp 8.5 trillion and 1.6 billion dollars. But not only that, there are also potentials losses that amounted to Rp 7.3 trillion and 698 million U.S. dollars. The most important of the SOEs is the opportunity to save money are still remain open in order to gain advantage in the amount of Rp 776 billion, and 147 dollars and profit of Rp 64.6 billion per year.
Zhuang in Yudha Pranata showed the weakness of Indonesian public companies in managing the company compared to Southeast Asian countries, this indicated by the lack of standards accounting and regulations, accountability to shareholders, the standards of disclosure and transparency as well as the processes of management of the company. This implies the weakness of Indonesian public companies on implementing good management company in satisfying stakeholders.
In order to validate the instrument, method of confirmatory factor analysis, CFA (adopted by Byrne and Kline ) was used. The test on the three constructs, namely tenant diversity, physical environment and intention, was done using the first order confirmatory factor analysis model, in which the method of maximum likelihood was used as the technique of estimation.The results obtained from the test showed that the factor structure for each three constructs was verified. The confirmatory factor analysis technique compares the variance-covariance matrix of the one obtained from the sample with the one obtained from the model. However, since this technique is fairly sensitive to sample size, it is recommended to have several cases for each free parameter. A test on the path model as shown in Figure 4 was done in order to conclude the analysis. The hypothesized structural equation was tested using AMOS version 16. For each of the constructs, namely tenant diversity of shopping mall, physical environment of a mall and intentions that motivates consumers in choosing a mall, the indicator variables were its respective factors which had been verified previously by the CFA. Goodness-of-fit was used to determine how well the structural equation model fits the sample data. For this analysis, commonly used goodness of fit tests which are chi-square method, goodness of fit index (GFI), adjusted goodness of fit index (AGFI), comparative fit index (CFI), as well as Root Mean Square Error of Approximation (RMSEA) were used. The goodness-of-fit tests’ results for the path model were:x2 = 500.90 with df = 199; GFI = 0.877; RMSEA = 0.071;CFI = 0.907.
This factor constitutes questions regarding emotions that motivate consumers in choosing a shopping mall. These emotions include thrill seeking, socializing and desire to stay in the shopping mall. This factor was adopted and looked thoroughly by Jason et al., Bloch et al. and, Wakefield and Baker. Ahmed et al. said shopping gives opportunities to the society to learn how to communicate with other people apart from those in own house (for example to find or make new friends and meet different kinds of people). Wakefield & Baker proposed an important aspect in visiting a shopping mall which includes the opportunity to interact with friends, family, or even strangers while at the mall. Besides that, according to their findings, desire to remain in a shopping mall is a component of approach behavior. The approach behavior is a common response variable among those who are in environmental psychology field of study. Also, some consumer will spend more money if he/she spends more time in the shopping mall. Many scholars support interrelationship pleasure or rise in the event affective and behavioral approach.