Journal of Theoretical and Applied Information Technology 31 st October 2017. Vol.95. No 20 © 2005 – ongoing JATIT & LLS ISSN: 1992-8645 www.jatit.org E-ISSN: 1817-3195 5552 THE INFLUENCE OF HUMAN RESOURCES COMPETENCY AND THE USE OF INFORMATION TECHNOLOGY ON THE QUALITY OF LOCAL GOVERNMENT FINANCIAL REPORT WITH REGIONAL ACCOUNTING SYSTEM AS AN INTERVENING ISKANDAR MUDA 1 , DENI YUWILIA WARDANI 2 , ERLINA 3 , AZHAR MAKSUM 4 , ADE FATMA LUBIS 5 , RINA BUKIT 6 & ERWIN ABUBAKAR 7 1,2,3,4,5,6,7 Faculty Economics and Business, Accounting Department, Universitas Sumatera Utara, Indonesia Corresponding Author : 1 iskandar1@usu.ac.id, 2 dewiyuwilia@usu.ac.id, 3 erlina@usu.ac.id, 4 azhar@usu.ac.id, 5 adefatma@usu.ac.id & 6 erwin1@usu.ac.id ABSTRACT This study aims to find out the influence of human resources competency and the use of information technology on the quality of local government financial report with regional accounting system as an intervening variable to regional works unit in Labuhanbatu Regency, Indonesia. The sampling technic in this study is using saturated sampling. There were 108 questionnaires distributed for all the staff members. The hypothesis was analyzed by using Structural Equation Model (SEM) with the help of SmartPLS software 2.0 M3. The result of this study is, partially, the human resources competency and the use of information technology have positive and significant influence towards the Regional Financial Accounting System (SAKD) in Labuhanbatu Regency, Indonesia.. The Regional Financial Accounting System (SAKD) mediates the influence of the Human Resources Competency and the use of information technology which do not have positive and significant influence on the quality of local government financial report of Labuhanbatu regency. This study recommends that there should be a comprehensive training program to improve the human resources competency in increasing the quality of local government financial report. Besides that, the head management should support the implementation of The Regional Financial Accounting System and Internal Control in order to improve the quality of local government financial report to be more optimal. Keywords : The Quality of Local Government Financial Report, Information Technology and the Regional Financial Accounting System, Regional Works Unit and Utilization. 1. INTRODUCTION Nowadays, transparentcy and accountability are the important effort to do to create good governance and clear governance as one of the manifestation of reform. "The transparency as a principle of guaranteeing access to or freedom for every person to obtain information about governance, information on the policy-making and implementation process and the results achieved" [2, 4, 13, 14, 15 & 23],, (transparentcy as a principle of guaranteeing access or freedom for every individual to obtain the information about governance, information about the policy process of making and implementation, also the achieved results). Whereas, the meaning of the accountability is “…accountability is accountable for resource management and policy implementation is entrusted to the reporting entity in achieving the goals set periodically [6, 17 & 18]. Accountability is accountable for resource management and policy implementation which is entrusted to the reporting entity in achieving the goal which has been assigned periodically. To build a good governance, the the first thing which is very closely related is human resources competency [16]. The better the quality of human resources is utilized, the better the performance results are obtained and it will lead to the achievement of the goal which has been assigned by the organization itself. According to [1, 3, 4 & 18]. To assess the capacity and competence of human resources in executing a function including accounting, can be seen from the level of responsibility and competence of these resources (To assess the capacity and human resources competency in running a function including the accounting, it can be seen