The effect of the performance of the audit committee, internal audit, and manager religion on the implementation of good corporate governance and their implications on fraud
DOI:
https://doi.org/10.22437/ppd.v10i2.11842Keywords:
Audit committee, Fraud, Good corporate governance, Internal audit, Religiosity of managersAbstract
The main objective of this research is to analyze the performance of the audit committee, internal audit, and religiosity of the manager on the implementation of good corporate governance (GCG) and its implication for fraud. The study was conducted at State-owned enterprises (SOEs) Â in Indonesia. The population of this research is all SOEs in Indonesia, and the number of samples is 89 SOEs (based on the Slovin formula). The sampling method used a simple random sampling technique. The research data was obtained by submitting a list of questions to the selected respondents. Respondents consist of the chairman of the audit committee or members of the audit committee, the head of internal audit or members of internal audit, the corporate secretary, and the finance director (financial manager). The data were analyzed using the SEM-PLS model. The research proves that the performance of audit committees and internal audits affects the implementation of GCG, while the religiosity of managers does not affect the implementation of GCG. The research also proves that the performance of the audit committee and the implementation of GCG affect fraud, while internal audit and religiosity of managers do not affect fraud
Downloads
References
Abdullah, R., Ismail, Z., & Smith, M. (2018). Audit committees’ involvement and the effects of quality in the internal audit function on corporate governance. International Journal of Auditing, 22(3), 385–403. https://doi.org/10.1111/ijau.12124
Abbott, L.J., Park, Y. & Parker, S. (2000). The effects of audit committee activity and independence on corporate fraud. Managerial Finance, 26(11), 55-68. https://doi.org/10.1108/03074350010766990
Al-Baidhani, A.M. (2016). The Role of Audit Committee in Corporate Governance: A Descriptive Study. International Journal Research & Methodology Social Science, 2(2), 45-57
Aydemir, M., & Eğİlmez, Ö. (2010). An Important Antecedent of Ethical/Unethical Behavior: Religiosity. Eurasian Journal of Business and Economics, 3(6), 71–84.
Bloodgood, J. M., Turnley, W. H., & Mudrack, P. (2008). The influence of ethics instruction, religiosity, and intelligence on cheating behavior. Journal of Business Ethics, 82(3), 557–571. https://doi.org/10.1007/s10551-007-9576-0
Chinn, R. (2000). Corporate Governance Handbook. London: Gee Publishing Ltd,
Drogalas, G., Arampatzis, K., & Anagnostopoulou, E. (2016). The relationship between corporate governance, internal audit and audit committee: Empirical evidence from Greece. Corporate Ownership and Control, 14(1), 569–577. https://doi.org/10.22495/cocv14i1c4art3
Effendi, M.A. (2016). The Power of Good Corporate Governance: Teori dan Implementasi. Jakarta: Salemba Empat
Eferakeya, I., Enaibre, I. F., & Offor, N. T. (2016). The Relationship Between Corporate Governance and Fraud Prevention in Nigeria : a perceptual view. Journal Of Social and Management Sciences, 11(3), 1–18.
Fikri, A. (2014). Tata Kelola Perusahaan Buruk jadi Pemicu Krisis Ekonomi Dunia. Retrieved from: https://www.liputan6.com/bisnis/read/817550/tata-kelola-perusahaan-buruk-jadi-pemicu-krisis-ekonomi-dunia.
Glock, C. & Stark, R. (1966). Religion and Society in Tension. Chicago: Rand McNally and Company.
Gusnardi, G. (2011). Pengaruh Peran Komite Audit, Pengendalian Internal, Audit Internal dan Pelaksanaan Tata Kelola. Ekuitas, 15(110), 130–146.
Hamdan, L.S., Jaffar, N., & Razak, R.A. (2018). The Effects of Interaction between Internal Auditor and Audit Committee on Fraud Detection in Malaysia. International Journal of Engineering & Technology, 7(4.38), 1338-1344. https://doi.org/10.14419/ijet.v7i4.38.27820.
Hasan, M.A.K., Prastiwi, I.E. & Triono, D.C. (2016). Pengaruh Fee Dan Religiusitas Terhadap Independensi Dewan Pengawas Syariah Dalam Mewujudkan Good Corporate Governance Untuk Meningkatkan Kinerja BMT. Equilibrium, 5(1) 113–133.
Heryana, T. & Novrita, V. (2012). Pengaruh Audit Internal terhadap Good Corporate Governance pada BUMN. Jurnal Akuntansi Riset, 4(2), 961-972
In’airat, M. (2015). The Role of Corporate Governance in Fraud Reduction-A Perception Study in the Saudi Arabia Business Environment. Journal of Accounting and Finance, 15(2), 119.
Jalaluddin, J. (2001). Psikologi Agama. Jakarta: PT.Raja Grafindo Perkasa
Karagiorgos, T. (2010). Corporate social responsibility and financial performance: An empirical analysis on Greek companies. European Research Studies Journal, 13(4), 85–108. https://doi.org/10.35808/ersj/301
Kim, J., & Daniel, S. J. (2016). Religion and Corporate Governance: Evidence from 32 Countries. Asia-Pacific Journal of Financial Studies, 45(2), 281–308. https://doi.org/10.1111/ajfs.12130
Nakpodia, F., Shrives, P. J., & Sorour, M. K. (2020). Examining the Link Between Religion and Corporate Governance: Insights From Nigeria. Business and Society, 59(5), 956–994. https://doi.org/10.1177/0007650317745852
Petrascu, D. & Tieanu, A. (2014). The Role of Internal Audit in Fraud Prevention and Detection. Procedia Economics and Finance, 16, 489-497
Pranoto, T. (2019). Quo Va Korup Q BUMN. Retrieved from https://mediaindonesia.com/kolom-pakar/276495/quo-va-korup-q-bumn
Salloum, L., Salloum, C., Jarrar, H., Sassine, M., Gebrayel, E., & Chaanine, N. (2016). Corporate governance and audit committee. International Journal of Managerial and Financial Accounting, 7(3–4), 198–216. https://doi.org/10.1504/IJMFA.2015.074900
Stratta, P., Capanna, C., Riccardi, I., Perugi, G., Toni, C., Dell’Osso, L., & Rossi, A. (2013). Spirituality and Religiosity in the Aftermath of a Natural Catastrophe in Italy. Journal of Religion and Health, 52(3), 1029–1037. https://doi.org/10.1007/s10943-012-9591-z
Tuek, B. & Klikovac, A. (2012). Corporate Governance Practices in Fraud Prevention and Detection: Empirical Evidence from Croatia. International Journal of Management Cases, 14(3), 59-71
Wefa, O. (2017). Pengaruh Implementasi Good Corporate Governance, Pengendalian Intern Kas, Asimetri Informasi terhadap Fraud. JOM Fekon, 4(1), 1007-1021
Zarkasyi, M.W. (2008). Good corporate governance : pada badan usaha manufaktur, perbankan, dan jasa keuangan lainnya. Bandung: Alfabeta
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2022 Rita Friyani, Haryadi Haryadi, Afrizal Afrizal, Enggar Diah Puspa Arum
This work is licensed under a Creative Commons Attribution 4.0 International License.
