PREVENTING FRAUD WITH FORENSIC AUDITS, COMPETENT AUDITORS AND WHISTLEBLOWING SYSTEMS: THE ROLE OF AN ORGANIZATION'S ETHICAL CULTURE
DOI:
https://doi.org/10.24903/obor.v8i2.4008Keywords:
auditor competence, ethical culture, forensic audit, fraudAbstract
Fraud prevention is a crucial effort in strengthening accountability and integrity within public sector organizations. This study aims to examine the effect of forensic audit, auditor competence, and whistleblowing system on fraud prevention through organizational ethical culture as a mediating variable at the East Kalimantan Provincial Inspectorate. This research employed a quantitative approach with a causal research design. The population consisted of 81 auditors working at the East Kalimantan Provincial Inspectorate. Using a purposive sampling technique, 81 questionnaires were distributed, 78 were returned, and 63 valid responses were analyzed, resulting in a response rate of 77.8%. Data were collected through questionnaires and analyzed using Structural Equation Modeling-Partial Least Squares (SEM-PLS). The results indicate that forensic audit, auditor competence, and whistleblowing system have a positive and significant effect on organizational ethical culture. Furthermore, forensic audit, auditor competence, and organizational ethical culture have a positive and significant effect on fraud prevention, whereas the whistleblowing system does not have a significant direct effect on fraud prevention. Organizational ethical culture was found to mediate the relationship between forensic audit, auditor competence, and whistleblowing system and fraud prevention. These findings suggest that strengthening forensic audit practices, enhancing auditor competence, and fostering an ethical organizational culture are essential strategies for improving fraud prevention within public sector organizations.
References
Abdillah, W. and J. H. (2015). Partial Least Square (PLS) Alternative Structural Equation Modeling (SEM) in Business Research. No.
ACFE. (2022). Occupational Fraud 2022: A Report to the Nations. In Acfe.
Achmad, T. et. al. (2024). Detecting Fraudulent Financial Statements with Analysis Fraud Hexagon: Evidence from State-Owned Enterprises Indonesia . Wseas Transactions On Business And Economics, 21. https://doi.org/10.37394/23207.2024.21.190
Agus Riyanto, Ali Mushofa, & Gandi Adnan. (2025). ANALYSIS OF CASH FLOW STATEMENTS AS A TOOL TO ASSESS THE FINANCIAL PERFORMANCE OF PT. LION METAL WORKS TBK FOR THE PERIOD 2020-2023. OBOR: Borneo Economics, 7(1), 26–50. https://doi.org/10.24903/obor.v7i1.3428
Ait Novatiani, R., Afiah, N. N., & Sumantri, R. (2022). Risk Management And Other Factors Preventing Fraudulent Financial Reporting By State-Owned Enterprises In Indonesia. Asian Economic and Financial Review, 12(8), 686–711. https://doi.org/10.55493/5002.v12i8.4587
Albrecht, W. S. , A. C. O. , & A. C. C. Z. M. F. (2019). Fraud Examination. Cengage Learning Asia.
Aprilliyanti, W. (2018). The Effect of Effectiveness of Internal Control, Information Asymmetry, Organizational Ethical Culture and Procedural Justice on the Tendency of Fraud in the Kendari City Government. E-Journal Accounting Analysis Journal.
Ardianingsih, A. (2018). Financial Statement Audit . PT. The Earth of Scripts.
Arens, A. A. ., Elder, R. J. ., & Beasley, M. S. . (2017). Auditing and assurance services. Pearson.
Arsad, S. et. al. (2025). Strengthening Corporate Fraud Detection through Forensic Accounting and Whistleblowing: The Moderating Role of Regulatory Enforcement. International Journal Of Research And Innovation In Social Science (IJRISS), IX(IX). https://doi.org/10.47772/IJRISS.2025.909000561
Arvianty, R. N. , & T. M. (2020). The Effect of Competence, Independence, and Size of Public Accounting Firm on Audit Quality. International Journal of Multicultural and Multireligious Understanding, 7(2), 476–489. https://doi.org/10.18415/ijmmu.v7i2.1487
Asyik, N. F. , & I. A. W. K. (2019). The Influence of Competence and Independence on Auditing with Auditor Ethics as a Moderation Variable. Journal of Accounting Science and Research, 8(8).
Aurora, T., Gletesya Tampubolon, M., Sirait, N. J., Manao, M. C., Utami, P., Sari, P., & Azzahra, A. S. (2025). The Role of Forensic Audit in Detecting and Preventing Asset Embezzlement in the Company. Journal of Business Economics, Management and Accounting, 4(2). https://doi.org/10.47134/aaem.v2i3.579
BPK RI. (2025). Overview of the Regional Audit Results of East Kalimantan Province in 2024.
Cressey, D. R. (1953). Other people’s money; a study of the social psychology of embezzlement. In Other people’s money; a study of the social psychology of embezzlement. Free Press.
Darmanah, G. (2019). Research Methods. Cv. Tlira Tech.
dprd.kaltimprov.go.id. (2025, May 23). East Kalimantan Achieves the 12th WTP of the Results of LHP BPK RI on the 2024 Financial Statements of the East Kalimantan Provincial Government. Dprd.Kaltimprov.Go.Id.
Elisabeth, D. M. et. al. (2023). The Influence of Apparatus Competence, Organizational Culture, Good Governance, and Internal Control System on Fraud Prevention Efforts in the Samosir Regency Government. Scientific Journal of AccUsi, 5(2), 118–127. https://doi.org/10.36985/rmmyrc67
Ferdiansyah, R. (2016). Analysis of Factors Affecting the Quality of Government Audit Results (Empirical Study on BPKP DKI Jakarta Provincial Representatives). Journal of Accounting and Business, 16(2). https://doi.org/10.20961/jab.v16i2.200
Ghozali, I. (2015). Structural equation modeling: An alternative method with Partial Least Squares (PLS) (Ed. 4). Publishing Agency of Diponegoro University.
Godwin Emmanuel, O. (2015). Integrity Of Financial Statements And Forensic Accounting Techniques In Internal Control Of Business Organisations. https://ssrn.com/abstract=2861578Electroniccopyavailableat:https://ssrn.com/abstract=2861578
Griffith, E. E. , H. J. S. , K. K. , & Y. D. (2015). Auditor Mindsets and Audits of Complex Estimates. Journal of Accounting Research, 53(1). https://doi.org/10.1111/1475-679X.12066
Hair, et al. (2017). A Primer on Partial Least Squares Equation Modeling (PLS-SEM) (Edisi Kedua). SAGEnPublications,Inc.
Lidya, R. (2016). Corruption and Forensic Accounting. I-Finance, 2(2).
LKJIP. (2023). Performance Report of Government Agencies in 2024.
Lutfi, M. et al. (2023). The Effect of Forensic Audit, Investigative Audit, and Professional Judgment on Fraud Disclosure at the South Sulawesi Representative BPKP Office. SEIKO: Journal of Management & Business, 6(2), 459–478. www.acfe.com/ fraud-tree.aspx
Mabel, S. N., Payamta, P., & Winarna, J. (2025). The development of fraud prevention policies in the public sector: A bibliometric analysis. Jurnal Akuntansi Dan Auditing Indonesia, 29(1), 2025. https://doi.org/10.20885/jaai.vol29.i
Maharany, S. A. et al. (2025). The Influence of Fraud Triangle on Financial Statement Fraud. Applied Economics and Accounting Studies, 2(2).
Malmqvist, J. , H. K. , M. G. , R. R. , & S. M. (2019). Conducting the Pilot Study: A Neglected Part of the Research Process? Methodological Findings Supporting the Importance of Piloting in Qualitative Research Studies. International Journal of Qualitative Methods, 18, 1–11. https://doi.org/10.1177/1609406919878341
Martono, N. (2016). Quantitative Research Methods Content analysis and secondary data analysis. PT. Raja Grafindo Persada.
Maulidi, A. (2016). Dealing with fraudulent financial statement in business organizations through whistleblowing system and staff awareness of Fraud. Proceedings of the International Conference on Accounting Studies (ICAS) , 324–331.
Musmulyadi, M., & Sari, F. I. (2020). Whistleblowing System in Breaking the Chain of Fraud to Realize Economic Growth (Study at the Directorate General of Taxes of Indonesia). Jesya (Journal of Sharia Economics & Economics), 3(2), 292–303. https://doi.org/10.36778/jesya.v3i2.198
Ningsih, N. H. , A. A. , H. M. , & A. A. (2022). The Influence of Internal Auditors, Internal Control and Whistleblowing System on Fraud Prevention (Empirical Study on State-Owned Enterprises in Palembang City). Accounting Journal.
Pramudyastuti, O. L. et. al. (2021). The Effect of the Implementation of the Whistleblowing System on Fraud with Independence as a Moderator. JIA (Scientific Journal of Accounting), 6(1), 115–135. https://doi.org/10.23887/jia.v6i1.32335
Putri Zaqiani, S., Tinggi Ilmu Ekonomi STAN, S., & Sopian, D. (2025). The Role Of Auditor Competence And Independence In Enhancing Internal Audit Quality With Auditor Ethics As A Mediating Variable. Indonesian Interdisciplinary Journal of Sharia Economics (IIJSE), 8(1).
Rahman, K. G., Nur, S., Said, R., Putri, A. N., & Accounting, J. (2022). The Role of Internal Audit in Fraud Prevention in Local Governments. In the Scientific Journal of Accounting (Vol. 1, Issue 2). https://e-jurnal.nobel.ac.id/imprest
Rahmat, M. et. al. (2023). The Influence of Internal Audit, Auditor Competence, Compensation Suitability and Whistleblowing System on Fraud Prevention. Postgraduate Management Journal, 2(2), 42–54. https://doi.org/10.36352/pmj.v2i2.503
Robbins, S. P. & T. A. J. (2017). Organizational Behaviour, Seventeenth Edition. Pearson Education Limited.
Ronald F. Duska, B. S. D. K. Wm. K. (2018). Accounting Ethics, 3rd Edition. John Wiley & Sons Ltd. https://doi.org/10.1002/9781394260270
Safitri, S. , F. Q. , & A. S. R. (2024). Analysis of the role of internal audit in fraud prevention based on literature review. Journal of Revenue, 5(1), 78–86. https://doi.org/10.46306/rev.v5i1.406
Sholehah, N. L., I. P., and Z. (2020). Accounting Fraud: Reviewed from Internal Control, Morality and Personal Culture. CV AA. Rizky.
Sudarmanto, E. et, al. (2021). Internal Control System. Our Writing Foundation.
Sulistiyo, A. and H. B. Y. (2022). The Influence of Internal Control, Risk Management and Wistleblowing System on Fraud Prevention. Journal of Accounting and Taxation, 23(01).
Sutrisno, P. M. (2019). Organizational Culture (Jakarta). Medium Pregnancy.
Tambunan, A. S. and T. M. (2024). The Effect of Forensic Audits on Fraud Prevention and Disclosure. Jura: Journal of Accounting Research, 2(2), 210–218. https://doi.org/10.54066/jura-itb.v2i2.1783
Tarjo and Eklamsia Sakti. (2022). Fraud Risk Management: A Research and Practice Reference. CV. Adanu Abimata.
Transparency International. (2024). Corruption Perceptions Index .
Tuanakotta. (2016). Investigative Audit. Salemba Four.
Tuanakotta, T. M. (2020). Critical Thinking in Auditing. Salemba Four.
Widyawati, N. P. A. et. al. (2019). The Influence of Human Resource Competence, Whistleblowing System, and Internal Control System on Fraud Prevention in Bumdes Fund Management (Empirical Study on Village-Owned Enterprises in Buleleng Regency). JIMAT (Scientific Journal of Accounting Students), 10(3), 368–379.
Zahari, A. I., Said, J., Muhamad, N., & Ramly, S. M. (2024). Ethical culture and leadership for sustainability and governance in public sector organisations within the ESG framework. Journal of Open Innovation: Technology, Market, and Complexity, 10(1). https://doi.org/10.1016/j.joitmc.2024.100219
Zarefar, A., & Arfan, D. T. (2017). Effectiveness of Internal Whistleblowing System . In Journal of Financial and Business Accounting (Vol. 10, Issue 2). http://jurnal.pcr.ac.id
