International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Vol. 7, Issue 2, pp: (727-736), Month: October 2019 - March 2020, Available at: www.researchpublish.com
The Effect of Independence and Professionalism on the Performance of Supervisory Board with Culture of Tri Hita Karana as a Moderating Variable Ni Putu Ayu Gita Purwiti Dewi1, I Gusti Ayu Eka Damayanthi2 1,2
Udayana University
1,2
Faculty of Economics and Bussiness, Bali, Indonesia
Abstract: This research purposes to determine the effect of independence and professionalism on the performance of the supervisory board with tri hita karana culture as a moderating variable in the LPD in Kediri District, Tabanan Regency. The performance of the supervisory board can be said to be good, if it has an attitude of independence and professionalism to support the performance of the supervisory board in carrying out its duties. This research method was a quantitative method that was associative in the form of data collection using a questionnaire. The population and sample was amounted to 80 respondents with saturated sampling method. The data analysis techniques used were multiple regression analysis and Moderated Regression Analysis (MRA). The result showed that independence and professionalism had a positive and significant effect on the performance of LPD supervisory board. It showed if independence and professionalism were higher, the performance of the board of supervisory increased. The result also showed that the culture of tri hita karana was able to moderate the positive effect of independence on the performance of the supervisory board, but the culture of tri hita karana was not able to moderate the effect of professionalism on the performance of the supervisory board. Keywords: independence, professionalism, tri hita karana culture, LPD supervisory board performance.
I. INTRODUCTION Indonesia is a developing country in where the current economic development in Indonesia is mostly centered on urban areas. It can cause inequality in economic development in rural areas. One of the financial institutions which was developed is Lembaga Perkreditan Desa (LPD) or Village Credit Institution in the Province of Bali and it was first established in 1985 in which it had facilitated the society to obtain venture capital and other activities. Based on Regional Regulation (Perda) of the Province of Bali No. 3 of 2017 concerning LPD, it states that LPD is a Financial Institution owned by Pekraman Village and located in these village. The purpose of establishing LPD is to create a ranking for villagers, increase the purchasing power of the society, encourage the development of rural communities through targeted savings and effective capital distribution, and streamline the process of transaction and money circulation in the village. The success of an LPD supervisory body in implementing an effective LPD internal control system, it is necessary to have a good and quality supervisory body's performance (Putra and Jati, 2019). Through observations executed, it is known that the supervisory activities carried out by the LPD supervisory board in Tabanan Regency are already good. It can be seen from the clear tasks, where the functions of the internal supervisory board are separated and independent from the activities that are examined. However, in Tabanan Regency, some LPDs are still experiencing difficulties. Based on news reported from BaliExpress, it is one of the most interesting in LPD of Pekraman Cepaka Village, Kediri District. Where this problem occurs because a lot of savings are not renewed in the books on LPD computers whose nominal reaches more than 1 billion rupiahs (Suyatra, 2018). One of the factors causing this case and causing the perpetrators of crime to
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