Integrated waste accounting for circular economy in local government: a case study of Sleman Regency’s sustainability transition (2022–2024)

Abstract

This study investigates the integration of public sector accounting with circular economy principles in local waste governance, using Sleman Regency, Indonesia, as a case study between the 2022 until 2024 period. Despite a significant increase in funding for circular economy-related budget allocations (from IDR 2 billion to IDR 6 billion, 2022-2024), these initiatives still account for less than 25% of total waste management expenditure and remain obscured within general service categories. Analysis of financial reports and stakeholder interviews reveals that Sleman’s accounting systems lack CE-specific budget tagging, standardized performance indicators, and mechanisms to trace environmental outcomes. These limitations hinder transparency, strategic evaluation, and long-term sustainability planning. Rather than incremental budget adjustments, the findings underscore the urgent need for public accounting system reformone that embeds ecological value creation, enables performance-based budgeting, and supports cross-sectoral coordination. By positioning accounting as a strategic enabler of sustainability transitions, this study offers a replicable framework for subnational governance innovation in emerging economies.