Exploring Internal Control System as Deterrent to Occupational Fraud in Local Government

International Journal of Economics and Management Studies

© 2020 by SSRG - IJEMS Journal

Volume 7 Issue 2

Year of Publication : 2020

Authors : Dian Anita Nuswantara

10.14445/23939125/IJEMS-V7I2P116

How to Cite?

Dian Anita Nuswantara, "Exploring Internal Control System as Deterrent to Occupational Fraud in Local Government," SSRG International Journal of Economics and Management Studies, vol. 7,  no. 2, pp. 99-110, 2020. Crossref, https://doi.org/10.14445/23939125/IJEMS-V7I2P116

Abstract:

This paper pursues to investigate the efficacy of the system of internal control to fight against occupational fraud in local governments. To answer the proposed research question, this study employs a quantitative method style. The adoption of a quantitative methodology is to test the relationships between the constituents of an internal control system and fight against occupational fraud. The empirical results suggest that the constituents of inner control, consisting of the control environment, risk assessment, control activities, information and communication, and monitoring activities, significantly can contribute positively to fighting against occupational fraud in local governments. However, the discretion of the control system that empowers apparatus to blow concerns, in this study, is considered as a springboard for fraud deterrence. Furthermore, another important point to improve the effectiveness of the use of public resources or to reduce black public expenditures is the form of numerous initiatives, through the hierarchical and functional composition of the organization, energizing usefully upon erroneous public administration.

Keywords:

Occupational Fraud, Local Government, Internal Control System

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