•  
  •  
 

Abstract

This study aims to explore the opportunity factors to commit fraud in local governments, Indonesia. The study samples were 785 local governments in Indonesia that had been audited by the Audit Board of the Republic of Indonesia in 2012 and 2013 fiscal years. Data were analyzed using factor analysis and logistic regression analysis. This study found that the opportunity to commit fraud in local governments, Indonesia could be measured using sub-districts, total assets, population, and capital expenditure variables. Additional test results found opportunity factor statistically significant affected the probability of fraud cases in local governments, Indonesia. This research only focuses on exploring the opportunity factor for fraud, in terms of ineffective monitoring and has not explored the opportunity factors that encourage fraud in terms of industrial nature and organizational structure

References

AICPA. 2002. Consideration of Fraud in a Financial Statement Audit SAS 99. Statement on Auditing Standards No. 99. https://doi.org/http://pcaobus.org/Standards/Auditing/Pages/AU316.aspx#au_316.14. Allison, Graham T. 2004. Public and Private Management: Are They Fundamentally Alike in All Unimportant Respects. In Classics of Public Administration. Belmont, CA: Wadsworth/Thomson Learning. Anthony, Robert N. 1985. Government Accountants Play. Harvard Busniess Review, 161–70. Badan Pemeriksa Keuangan RI. 2017. Standar Pemeriksaan Keuangan Negara. Cressey, Donald Ray. 1950. Criminal Violation of Financial Trust. Indiana University. Dorminey, Jack, A. Scott Fleming, Mary Jo Kranacher, and Richard A. Riley. 2012. The Evolution of Fraud Theory. Issues in Accounting Education 27 (2):555–79. https://doi.org/10.2308/iace-50131. Fatimah, Desi, Nelly.Rian Sari, and M Rasull. 2014. The Influence of Internal Control System, Compliance with Legislation, Audit Opinions in the Previous Year and Government Age on the Acceptance of Unqulaified Opinion in the Financial Statements of Regional Government Troughout Indonesia. Journal of Accounting, 3 (1), 1–15. Gosling, James J. 2015. Budgetary Politics in American Government. 6th ed. New York: Routledge. Gudono. 2012. Analisis Data Multivariat. 2nd ed. Yogyakarta: BPFE. Gudono. 2017. Teori Organisasi. 4th ed. Yogyakarta: Andy Offset. Hair, J., W. Black, B. Babin, and R. Anderson. 2011. Multivariate Data Analysis: A Global Perspective. 7th ed. New Jersey: Pearson Education Limited. Hartono, Rudi, Amir Mahmud, and Nanik Sri Utaminingsih. 2014. PAD dan Kompleksitas Berpengaruh Signifikan Terhadap Kelemahan Pengendalian Intern. Bagi Pemerintah Daerah Diharapkan Lebih Memperhatikan Kualitas Pengendalian Intern. Paper dipresentasikan pada Simposium Nasional Akuntansi XVII, Mataram, Lombok. Indonesian Corruption Watch. 2006. Korupsi Sistemik. Diunduh tanggal 20 Februari 2011, https://antikorupsi.org/id/news/korupsi-sistemik. Indonesia Corruption Watch. 2010. Laporan Tahunan ICW 2010. Jakarta. Indonesia Corruption Watch. 2015. Kasus Fraud Di Pemerintah Daerah Indonesia Tahun Anggaran 2014 Dan 2015. Jakarta. Laporan Tidak Dipublikasikan. Indonesia Corruption Watch. 2016. Tren Korupsi Kesehatan Periode 2010-2015. Jakarta. Indonesia Corruption Watch. 2017. Tren Penindakan Kasus Korupsi. Jakarta. https://antikorupsi.org/sites/default/files/tren_korupsi_2017.pdf. Isaksen, Jan. 2005. The Budget Process and Corruption. U4 Issue Paper, 3, 1–25. http://scholar.google.com/scholar?hl=en&btnG=Search&q=intitle:The+budget+process+and+corruption#1. Ivancevich, J.M, R Konopaske, and Matteson M.T. 2013. Organizational Behaviour and Management. 10th ed. Maidenhead-Berkshire: McGraw-Hill. Jones, Stewart, and R. G Walker. 2007. Explanators of Local Goverment Distress. ABACUS, 43 (3), 396–418. Kranacher, Marry. Jo, R. Riley, and J.T. Wells. 2011. Forensic Accounting and Fraud Examination. John Wiley & Sons. Larassati, R, R. Anggraini, and E Gerendrawaty. 2013. Pengaruh Ukuran, Pertumbuhan Dan Kompleksitas Pemerintah Daerah Terhadap Kelemahan Pengendalian Internal Pemerintah Daerah Provinsi Di Indonesia Periode 2009-2010. Paper dipresentasikan pada acara Simposium Nasional Akuntansi XVI, Manado. Lou, Yung-i, and Ming-long Wang. 2009. Fraud Risk Factor Of The Fraud Triangle Assessing The Likelihood Of Fraudulent Financial Reporting. Journal of Business & Economics Research, 7 (2), 61–78. https://doi.org/10.19030/jber.v7i2.2262. Mahmudi. 2010. Analisis Laporan Keuangan Pemerintah Daerah. 2nd ed. Yogyakarta: UPP STIM YKPN. Maria, Evi, Abdul Halim, and Eko Suwardi. 2018a. Effect of Financial Distress and Regional Independence on the Probability of Corruption: An Empirical Study in Indonesian Local Governments. Paper presented at 3rd Comparative Asia Africa Governmental Accounting Conference. South Korea: Seoul National University. Maria, Evi, Abdul Halim, and Eko Suwandi. 2018b. Eksplorasi Faktor Tekanan Untuk Melakukan Fraud Di Pemerintah Daerah, Indonesia. Jurnal Akuntansi Publik, 1 (1), 111–26. https://doi.org/10.32554/jap.v1.i1.p111-126. Martani, Dwi, and Fazri Zailani. 2011. Pengaruh Ukuran, Pertumbuhan,Dan Kompleksitas Terhadap Pengendalian Intern Pemerintah Daerah. Paper dipresentasikan pada acara The XIV National Accounting Symposium, Aceh. Mauro, Paolo. 1998. Corruption and the Composition of Government Expenditure. Journal of Public Economics, 69, 263–79. Mcnally, J Stephen. 2013. The 2013 COSO Framework and SOX Compliance, June 2013. https://www.coso.org/documents/COSO McNallyTransition Article-Final COSO Version Proof_5-31-13.pdf. Muhtar, Sutaryo, and Sriyanto. 2018. Corruption in Indonesia Local Government: Study on Triangle Fraud Theory. International Journal of Business and Society, 19 (2), 536–52. Mulyani, Pujianik, and Rindah F Suryawati. 2011. Analisis Peran Dan Fungsi Sistem Pengendalian Intern Pemerintah (SPIP/PP No.60 Tahun 2008) Dalam Meminimalisasi Tingkat Salah Saji Pencatatan Akuntansi Keuangan Pemerintah Daerah. Jurnal Organisasi Dan Manajemen, 7 (2), 102–16. Neu, Dean, Jeff Everett, Abu Shiraz Rahaman, and Daniel Martinez. 2013. Accounting and Networks of Corruption. Accounting, Organizations and Society, 38, (6–7). Elsevier Ltd:505–24. https://doi.org/10.1016/j.aos.2012.01.003. Ogneva, Maria, K R Subramanyam, and K Raghunandan. 2007. Internal Control and Cost Equity: Evidence from SOX Section 404 Disclosures. The Accounting Review, 82 (5), 1255–97. https://doi.org/10.2307/30243499. Petrovits, Christine, Catherine Shakespeare, and Aimee Shih. 2011. The Causes and Consequences of Internal Control Problems in Nonprofit Organizations. Accounting Review, 86 (1), 325–57. https://doi.org/10.2308/accr.00000012. Power, Michael. 2013. The Apparatus of Fraud Risk. Accounting, Organizations and Society, 38, (6–7). Elsevier Ltd:525–43. https://doi.org/10.1016/j.aos.2012.07.004. Puspasari, Novita, and Eko Suwardi. 2016. The Effect of Individual Morality and Internal Control on the Propensity To Commit Fraud . Journal of Indonesian Economy and Business, 31 (2), 208–19. Ritonga, Irwan Taufiq, Colin Clark, and Guneratne Wickremasinghe. 2012. Assessing Financial Condition of Local Government in Indonesia : An Exploration. Public and Municipal Finance, 1 (2), 37–50. Setyaningrum, Dyah, and Febriyani Syafitri. 2012. Analisis Pengaruh Karakteristik Pemerintah Daerah Terhadap Tingkat Pengungkapan Laporan Keuangan. Jurnal Akuntansi Dan Keuangan Indonesia, 9 (2), 154–70. https://doi.org/10.21002/jaki.2012.10. Shafritz, Jay M., Steven J. Ott, and Yong Suk Jang. 2011. Classics of Organization Theory. 7th ed. Boston: Wadsworth Cengage Learning. Skousen, Christopher J; Smith, Kevin R; Wright, Charlotte J. 2009. Detecting and Predicting Financial Statement Fraud: The Effectiveness of the Fraud Triangle and SAS No. 99. Corporate Governance and Firm Performance Advances in Financial Economics, 13, 53–81. https://doi.org/10.1108/S1569-3732(2009)0000013005. Stalebrink, Odd J, and John F Sacco. 2007. Rationalization of Financial Statement Fraud in Government : An Austrian Perspective, 18, 489–507. https://doi.org/10.1016/j.cpa.2006.01.009. Suyanto. 2009. “Evidence from Statement on Auditing Standard No . 99. Gadjah Mada International Journal of Business, 11 (1), 117–44. Trompeter, Gregory M., Tina D. Carpenter, Naman Desai, Keith L. Jones, and Richard A. Riley. 2013. A Synthesis of Fraud-Related Research. Auditing, 32 (SUPPL.1), 287–321. https://doi.org/10.2308/ajpt-50360. Tuanakotta, Theodorus M. 2010. Akuntansi Forensik Dan Audit Investigatif. 2nd ed. Jakarta: Penerbit Salemba Empat. Undang-Undang Nomor 12. 2011. Pembentukan Peraturan Perundang-Undangan. Wolfe, David T, and Dana R Hermanson. 2004. The Fraud Diamond : Considering the Four Elements of Fraud. CPA Journal, 74 (12), 38–42

Download

Share

COinS