Effectiveness of Internal Audit in Supporting Internal Control and Prevention of Fraud

Abstract

This study aims to analyze the effectiveness of internal audit at PT Bank Sulselbar Makassar in supporting internal control over fraud. This study uses a qualitative approach with the method of documentation, interviews and questionnaires to the internal auditors, anti-fraud department, and management as data collection methods. After the data was collected, data analysis was carried out using descriptive methods and measuring effectiveness. Based on the study results, it can be stated that the role of the Internal Audit Group as an internal audit in improving the internal control system for fraud at Bank Sulselbar has been influential. The internal audit of Bank Sulselbar has the authority to monitor the follow-up to the results of the audit conducted by the auditor. Monitoring activities are carried out to ensure that corrective actions have been carried out adequately and effectively. Thus, the company will implement better internal controls in the future because assessments and corrective actions for weaknesses and errors found are always carried out. There are three elements to prevent and detect fraud, namely a culture of honesty (personal), management responsibility to evaluate fraud risk (through internal control), and supervision by the audit committee (internal audit).

Effectiveness of Internal Audit in Rural Banks

“…The BPR's unsoundness mainly was caused by credit disbursement that failed to adhere to prudential standards and good banking practices (pikiran-rakyat.com) According to the Deposit Insurance Corporation (LPS), 39 Rural Banks have been liquidated or are liquidated between 2015 and 2019. Several causes contributed to the BPR's downfall, including internal bank fraud (Sudirman, Sasmita, Djabir D, et al, 2021;Rashid et al, 2021), as well as managerial failure owing to a lack of good corporate governance (Shamsuddin & Bakar, 2020). Therefore, human resources, processes, and procedures, as well as supervision or internal control, are all critical to consider while creating an effective Rural Bank.…”

Fraud in Accounting: Surveys on Hotels in Bandung

“…The same point was made by Zamzami et al, (2018), who stated that preventing and detecting fraud was an important goal of internal audit. Sudirman et al, (2021) in their research on banks, found that companies with effective internal controls (76-100%) could prevent fraud.…”

Analisis Fraud Triangle Untuk Mendeteksi Kecurangan Laporan Keuangan Pada Sub Sektor Farmasi Yang Terdaftar Di Bursa Efek Indonesia Periode Tahun 2017-2020

“…Selanjutnya hal lain yang harus dilakukan oleh perusahaan untuk mencegah fraud adalah komitmen yang dimana pihak manajemen/pengelola perusahaan dituntut untuk memiliki komitmen penuh untuk selalu meningkatkan nilai perusahaan (Chen et al, 2012) dan bekerja untuk mengoptimalkan nilai pemegang sahamnnya serta menurunkan risiko perusahaan (Roszkowska & Melé, 2021) selain itu perusahaan harus mengefektifkan fungsi internal auditor (Chang et al, 2019) Walaupun internal auditor tidak dapat menjamin bahwa kecurangan tidak akan terjadi, namun ia harus menggunakan kemahiran jabatannya dengan saksama sehingga diharapkan mampu mendeteksi terjadinya kecurangan dan dapat memberikan saran-saran yang bermafaat kepada manajemen untuk mencegah terjadinya kecurangan (Vasarhelyi et al, 2004)Beberapa hal yang harus diperhatikan oleh manajemen agar fungsi internal audit bisa efektif membantu manajemen dalam melaksanakan tanggungjawabnya dengan memberikan analisa, penilaian, saran dan komentar mengenai kegiatan yang diperiksanya (Sudirman et al, 2020) Teori Sinyal Menurut Nazilah et al (2018) sinyal tersebut berupa informasi mengenai kondisi perusahaan kepada pemilik ataupun pihak yang berkepentingan (Nazilah et al, 2018). Sinyal yang diberikan dapat juga dilakukan melalui pengungkapan informasi akuntansi seperti laporan keuangan, laporan apa yang sudah dilakukan oleh manajemen untuk merealisasikan keinginan pemilik, atau bahkan dapat berupa promosi serta informasi lain yang menyatakan bahwa perusahaan tersebut lebih baik daripada perusahaan lain (Nazilah et al, 2018).…”