Office Resources

6.3.5 Office Resources

Although BPK‘s IT system has been developed and improved, Members of Parliament and auditors had criticisms. Some auditors (Interview B15, B17, and B22) found that the capacity of BPK‘s electronic communications network and LAN were slow, unstable and suffered from viruses. Two Members of Parliament (Interview C2 and C3)

expressed their problem in opening the BPK website to see the audit reports and complained about the lack of computers and au dit references at Parliament‘s Library. An expressed their problem in opening the BPK website to see the audit reports and complained about the lack of computers and au dit references at Parliament‘s Library. An

Office accommodation is an essential resource for BPK as it influences the quality of audit reports in terms of the audit scope and the followup of audit reports. In the past, up to 2003, BPK had only one central office in Jakarta and six representative offices in Yogyakarta, Makasar (South Sulawesi), Medan (North Sumatera), Banjarmasin (South Kalimantan), Denpasar (Bali) and Palembang (South Sumatera).This situation resulted in a lack of audit scope. For example, Lampung representative office had to be audited by Palembang office. On the other side, an internal audit institution, BPKP, had a much

bigger number of regional representative offices than did BPK 94 . Member II of BPK explained (14/02/2007) that the biggest impediments to BPK were Indonesia‘s geography and the infrastructure of transportation and communication needed to reach distant

territories in the east of Indonesia, such as Papua and Maluku. Therefore, auditees of BPK were limited to central government and several provinces that could be reached by the representative offices. Most of the regional governments were audited by BPKP, which had the same function as BPK. As a result, regional government entities were more familiar with BPKP than BPK.

Table 6.9 (below) presents data and information of the opening dates of BPK representative offices in every province. Each representative office of BPK has different number of local government audited entities. The data indicates the great improving of the

94 For instance, in 2003, in the regions, the number of representative office of BPKP was 25, with 5,104 BPKP officials, while BPK had only 7 representative offices with 955 BPK officials

(BPK RI 2006).

progress numbers of BPK representative office from only six offices in 2001 to 33 offices in 2008.The highest number of auditees (local government and regional-owned enterprises) in BPK representative office is in Surabaya with 38, followed by Semarang with 35, and Medan and Bandung each with 26. The lowest are Mamuju and Yogjakarta BPK representative offices each with only five auditees.

Table 6-9 Opening Dates of BPK Representative Offices (1950-2008)

No Opening Dates

Representative Office

Province (33)

Auditees (456) in 2007

South Sulawesi

North Sumatera

13 V 21/09/2001

Banjarmasin

South Kalimantan

South Sumatera

East Papua

DKI Jakarta

38 X 05/12/2005

Surabaya

East Java

13 XI 09/12/2005

Menado

North Sulawesi

Banda Aceh

West Java

West Kalimantan

13 XVI

Samarinda

East Kalimantan

Central Kalimantan

South East Sulawesi

West Papua

North Maluku

East Nusa Tenggara

West Sumatera

Central Sulawesi

West Nusa Tenggara

Riau Archipelago

Central Java

7 XXXII

Pangkal Pinang

Bangka Belitung

5 Sources: Adapted from: 1. Website of BPK: http://www.bpk.go.id/ (accessed from 14/03/2005 to 23/06/2009). 2. BPK, 2007. The Audit Board of the Republic of Indonesia, Jakarta, BPK RI (2007a). 3. BPS, Statistics Indonesia, List of Province/Regency/City, January 2007 (BPS 2007).

Mamuju

West Sulawesi

As mandated by Article 23G of the Constitution (2001) and the Law on BPK (GOI 2006b), BPK should have a representative office in every province. Indonesia‘s geographic location, separate by oceans and seas 95 requires BPK to provide an office in every province

as mandated by the Constitution (2001). The representative offices are established by a BPK regulation, taking budget capacity into consideration.

After audit reform, BPK opened 27 new representative offices from the west to the east of Indonesia. Table 6.9 shows that the number of BPK representative offices increased from six (in 2001) to 11 (in 2005). By the end of 2006the total was 17 (about 50 per cent of the number of provinces).In 2007, BPK opened a further 11 new representative officesfollowed by another five in 2008. The data indicates that BPK made a great effort in opening 33 representative offices to cover every province in Indonesia by 2008. In 2007, the Chairman of BPK said, ―Our target is that by the end of 2008, BPK will have representative offices in every province as stipulated by Amended 1945 Constitution (2001) ‖ (Radar Lampung 10 March 2007). As the data shows, this target was successfully reached.

It is more effective and efficient if BPK has a representative office in every province because auditors can gain a better understanding of their own local auditees, reduce costs, and have a longer time for auditing if the distance between an auditors‘

95 Indonesia is often referred to as the world's largest archipelago, with around 17,508 islands which span more than 5000 km (around 3,200 miles) Eastward from Sabang in Northern Sumatera to

Merauke in Irian Jaya ( http://www.indo.com/indonesia/archipelago.html ). It had a population of about 235 million people based on the estimation from the US census bureau 2007 (the Economist Intelligence Unit 2008: 2).

domicile and the auditees ‘ offices is shorter. Therefore, opening the BPK representative offices has helped to provide more effective and efficient auditing of regional governments to encourage their transparency and accountability. Figure 6.7(below) illustrates Indonesia‘s geographical spread and the location of BPK representative offices throughout

Indonesia.

Figure 6.7 Representative Offices of BPK in 33 Provinces (2008)

As the budget for opening representative offices was still not fully covered by the BPK budget, BPK also received loans and grants from other countries and international organisations, such as ADB, USAID, and AusAID. For instance, the opening of the BPK office in Aceh was mostly funded by ADB and USAID. Moreover, some BPK representative offices were opened by building loans from regional government. For example, the BPK office in Pekanbaru province is located in the former office of the As the budget for opening representative offices was still not fully covered by the BPK budget, BPK also received loans and grants from other countries and international organisations, such as ADB, USAID, and AusAID. For instance, the opening of the BPK office in Aceh was mostly funded by ADB and USAID. Moreover, some BPK representative offices were opened by building loans from regional government. For example, the BPK office in Pekanbaru province is located in the former office of the

own office and is still hosted in a local government building, this results in BPK auditors lacking a strong position.