THE INFLUENCE OF INTERNAL AUDIT, RISK MANAGEMENT, WHISTLEBLOWING SYSTEM AND BIG DATA ANALYTICS ON THE FINANCIAL CRIME BEHAVIOR PREVENTION

Abstract

This study provides a critical review of the literature that examines and analyses how Fraud Prevention mediates the Effect of Internal Audit, Risk Management, Whistle Blowing System and Big Data Analytics on the Prevention of Financial Crime Behaviour. The problem discussed in this study is the limited strategic formulation in risk management, internal audit, whistleblowing system and big data analytics for early detection for fraud prevention and prevention of financial crime behavior in Indonesia, especially the problem of fraud that occurs in the Sumatra Regional Government, namely in Aceh, North Sumatra, Riau, Kepulauan Riau, South Sumatra, Bangka Belitung, Jambi, West Sumatra, Bengkulu and Lampung. Various kinds of scientific studies that have been carried out provide clues that the skills mismatch on the impact of fraud and financial crime behavior is still a fundamental polemic that will continue to hamper the productivity and competitiveness of various economic and industrial sectors in Regional Governments in Indonesia. To prepare for the emerging discourse, this research refers to 90 articles published in leading academic journals, discussing related topics from the early 1990s to 2021. Therefore, the formulation of the problem in this study: (1) How does Internal Audit influence prevention fraud, (2) How does Risk Management influence fraud prevention, (3) How does Whistleblowing system influence fraud prevention, (4) How big data analytics influence fraud prevention, (5) How fraud prevention mediates the influence of Internal Audit, Risk Management, whistleblowing system and big data analytics to prevent financial crime behavior.

Keywords:

• Big data analytics
• financial crime behaviour prevention
• fraud prevention
• internal audit
• risk management
• systematic review
• whistle blowing system

PUBLIC INTEREST STATEMENT

Since 1990, there is a sizable accounting literature on the determinants of fraud prevention and financial crime behaviour.

Several functions within Regional Governments in Indonesia are not carried out obediently and consistently, which leads to unhealthy structural and managerial activities.

Hence, researchers recommend a combined variable approach, the internal audit, risk management, whistleblowing systems and big data analytics on both problems, as the initial determining factors through digital analysis and auditing skills to prevent them in facing dynamics change and development of digital native, intelligent mobility, healthy living arrangements, civil security, and technology in the workplace by regarding economic, socio-cultural challenges and state life aspects to build economic citizens generation affected by cases of them.

This paper output provides a comprehensive understanding of responsibilities for financial statement fraud control in the context of the above theories and contributes recommendations for improvement in financial statement fraud control in public interest entities.

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Funding

The authors received no direct funding for this research.

Notes on contributors

Iwan Putra

Iwan Putra, a postgraduate student at Economics Study Program, Universitas Jambi, Indonesia who has research interest in the area of financial accounting, economic of education and auditing.

Urip Sulistiyo

Urip Sulistiyo, a lecturer at the Faculty of Teacher Training and Education, Universitas Jambi who has research interest in the area of teacher education and professional development, and language curriculum.

Enggar Diah

Enggar Diah, a lecturer at the faculty of economics and business, Universitas Jambi who has research interest in Fraudulent Financial Reporting, Fraud Disclosure, internal audit, etc.

Sri Rahayu

Sri Rahayu, a lecturer at the faculty of economics and business, Universitas Jambi who has research interest in Financial Constraints and corporate governance, government organization, etc.

Syurya Hidayat

Syurya Hidayat, a senior lecturer at the faculty of economics and business, Universitas Jambi who has research interest in the area of development model and strategies of global economics approach in Indonesia.