The Morality Factors in Preventing Fraud in Village Fund Management
Keywords:
Internal control system, competency, morality, fraud preventionAbstract
Introduction/Main Objectives: This study seeks to examine the role of morality as a mediating variable in the association among the internal control system (SPI) and the village officials competence (KAD) on efforts to avoid fraud in the management of Village Funds in Ngariboyo District, Magetan Regency. Background Problem: Following the application of Law No. 6 of 2014 on Villages, the allocation of Village Funds has increased substantially each year. This situation places greater responsibility on Village Governments to ensure that fraudulent practices in Village Fund management are effectively prevented. Novelty: The research offers a new perspective by emphasizing the significance of morality (MOR) as a mediator among SPI and village officials’ competence (KAD) in influencing fraud prevention (FRA) within the Village Fund management process. Research Methods: A quantitative research design was employed. The sample was selected through purposive sampling, involving 10 villages in Ngariboyo District, Magetan Regency. A total of 50 respondents who were directly engaged in the Village Funds management participated in the research. Path analysis was conducted using the SmartPLS 4 software. Findings/Results: The findings reveal that SPI, the competence, and morality individually exerts a significant positive effect on preventing fraud. Morality does not mediate the relationship among SPI and fraud avoidance, but it does mediate the influence of village officials’ competence on fraud prevention. Conclusion: Strengthening the implementation of SPI, enhancing the competence, and fostering strong moral values are crucial for preventing fraud in management of Village Fund. Enhancing the ethical standards of village officials is anticipated to contribute to limiting corruption and minimizing fraudulent use of Village Funds.
References
Ahdiat, Adi. Since the Village Fund, the Trend of Corruption in Villages Has Increased. https://databoks.katadata.co.id/datapublish/2024/05/03/sejak-ada-dana-desa-tren-korupsi-di-desa-meningkat (03/05/2024, accessed 08/02/2025)
Ajzen, I. (1991). The theory of planned behavior. Organizational Behavior and Human Decision Processes, 50(2), 179-211. doi:10.1016/0749-5978(91)90020-T
Chin, W. W. (1998). The Partial Least Squares Approach to Structural Equation Modeling, in Modern Methods for Business Research, ed. Marcoulides, G.A., Lawrence Erlbaum Associates, Inc., Mahwah - NJ, pp. 295-336.
Davis, J. H., Schoorman, F. D., & Doladson, L. (1997). “Toward A Stewardship Theory Of Management”. Academy of management Review. 22(1), 20-47.
Donaldson, L., & Davis, J. H. (1991). “Stewardship theory or agency theory: CEO governance and shareholder returns”. Australian Journal of Management. 16(1), 49-64.
Ghozali, Imam & Latan, Hengky. (2015). Konsep, Teknik, Aplikasi Menggunakan Smart PLS 3.0 Untuk Penelitian Empiris. Semarang: BP Undip.
Ghozali, Imam & Latan, Hengky. (2015). Partial Least Squares Engineering Concept and Application with Smart PLS 3.0 Program. Semarang: Diponegoro University Semarang.
Ghozali, Imam. (2018). Multivariate Analysis Application with IBM SPSS 23 Program . Semarang, Diponegoro University Publishing Agency.
Ghozali, Imam. 2016. Multivariate Analysis Application with IBM SPSS 23 Program (8th Edition). VIIIth Printing. Semarang: Diponegoro University Publishing Agency.
Hayati, N., & Amalia, I. (2021). The Effect of Religiosity and Moderation of Morality on Fraud Prevention in The Management of Village Funds. The Indonesian Accounting Review , 11(1), 105–144.
Irianto, Gugus & Novianti, Nurita (2019). Dealing With Fraud . Malang: UB Pres
Laksmi, Putu Santi Putri & Sujana, I Ketut. (2019). The Influence of Human Resource Competence, Morality and Internal Control System on Fraud Prevention in Village Financial Management. E-Journal of Accounting, Udayana University Vol.26(3), 2155-2182. DOI: https://doi.org/10.24843/EJA.2019.v26.i03.p18
Lestari, IAME & Ayu, PC (2021). The Influence of Individual Morality, Organizational Commitment and Whistleblowing System on Fraud Prevention in Village Financial Management. Hita Accounting and Finance , 2 (3), 101-116.
Nashruah, N. U & Wijayanti, P. (2019). Factors Influencing the Tendency of Accounting Fraud in Village Government. Indonesian Accounting Journal , 8 (2), 41-153.
Ogbeibu, S., Emelifeonwu, J., Senadjki, A., Gaskin, J., & Kaivo-oja, J. (2020). Technological turbulence and greening of team creativity, product innovation, and human resource management: Implications for sustainability. Journal of Cleaner Production, 244 , 118703. https://doi.org/10.1016/j.jclepro.2019.118703
Rahimah, Laila Nur., Yetty, Murni & Shanti, L. (2018). The Influence of Presentation of Village Financial Reports, Control Environment and Individual Morality on Fraud Prevention that Occurs in the Management of Village Fund Allocation (Case Study in Sukamantri Village, Sukamanah Village, Sukaresmi Village and Gunungjaya Village, Cisaat District, Sukabumi Regency) . Scientific Journal of Economics . 6 (12), pages 139-154.
Rakanti, Ni Putu Tarisa Putri & Ratnadi, Ni Made Dwi. (2024). Competence of Village Apparatus, Morality, Internal Control System, and Fraud Prevention in Village Fund Management. Journal of Business Accounting , 22 (2), 258-273 . https://journal.unika.ac.id/index.php/jab/article/view/12315
Rustiyaningsih, Sri. (2023). Organizational Culture and Fraud Prevention in Village Financial Management with Individual Morality as Mediation. JKBM (Journal of Business and Management Concepts), 9(2). 149-159. DOI 10.31289/jkbm.v9i2.9479
Saputra, KAK, Pradnyanitasari, PD, Priliandani, NM I & Putra, IGBNP (2019). Accountability Practices and Human Resource Competence for Fraud Prevention in Village Fund Management. KRISNA Journal. 10 (2), 68-176.
Sari, NKIP, & Suartana, IW (2020). Analysis of Factors Influencing Fraud in Procurement of Goods and Services in Village Government. Journal of Accounting 30(3), 571-583.
Sarstedt, M., Ringle, C.M. and Hair, J.F. (2021) ‘Partial Least Squares Structural Equation Modeling’, Handbook of Market Research, (November), pp. 587–632. Available at: https://doi.org/10.1007/978-3-319-57413-4_15.
Sarstedt, M.; Ringle, C.M.; & Hair, J.F. (2017). Partial Least Square Structural Modelling. Hanbook of Market Research, 1-40.
Schillemans, T., & Bjurstrom, K. H. (2020). Trust and verification: Balancing agency and stewardship theory in the governance of agencies. International Public Management Journal, 23(5), 650-676.
Setyowati, Supami Wahyu; and Tyasari, Irma. (2022). Determinants of Fraud Prevention in Village Fund Management Moderated by Apparatus Competence. Organum: Scientific Journal of Management and Accounting , 5(01), 62-72.
Sugiyono. (2017). Quantitative, Qualitative, and R&D Research Methods . Bandung: Alphabet.
Suratman, Adji & Triana Meinarsih. (2021). Forensic Audit . Jakarta: PT. Manadala National.
Tuanakotta, T. (2016). Forensic Accounting & Investigative Audit. Jakarta: Salemba Empat.
Wetzels, M., Odekerken-Schröder, G., & Oppen, C. Van. (2009). Assessing Using PLS Path Modeling Hierarchical and Empirical Construct Models: Guidelines. MIS Quarterly, 33(1) , 177–195.
Wibisono, Nurharibnu & Herry, Purnomo. (2017). Revealing the Phenomenon of Public Supervision of Village Funds in Madiun Regency. AKSI Journal ( Accounting and Information Systems), 2(1), 8 – 19.
Wibisono, Nurharibnu; Abidin, Munirul; & Ekowati; Vivin Maharani. (2024). Economic Growth Mediates Village Funds and Original Local Government Revenue towards Poverty in Regencies/Cities in East Java. Al-Falah: Journal of Islamic Economics , 9(1), 39-56. DOI: 10.29240/alfalah.v9i1.8314
Wibisono, Nurharibnu; Asnawi, Nur; & Ekowati, Vivin Maharani. (2025). Improving Village Government Performance through Village Financial Management, Good Village Governance, and Knowledge Management. AKRUAL: Jurnal Akuntansi, 16(2), 164-178. DOI: 10.26740/jaj.v16n2.p164-177
Wicaksono, Ronny. (2020). Allegedly Corrupting Village Funds, Former Baleasri Village Head Detained in Magetan Detention Center. https://jatim.times.co.id/news/berita/2fm417p3qg/diduga-korupsi-dana-desa-mantan-kades-baleasri-ditahan-di-rutan-magetan . accessed February 17, 2025 .
Widodo, Sri and Cahyaningrum, Novia Putri. (2023). Determinants of Fraud Prevention in Village Financial Management. Journal of Accounting and Financial Research, 11 (1) , 2023, 41-56.
Wijayanti, P., Kartika, I., Kiryanto, K., Adiwijaya, ZA, Shodiq, MJ F & Mutoharoh, M. (2020). Optimizing the Role of Village Facilitators in Preventing Village Government Fraud in Demak Regency. Indonesian Journal of Community Services . 2 (1), pages 55-67.
Law of the Republic of Indonesia Number 6 of 2014 concerning Villages.
Government Regulation of the Republic of Indonesia Number 60 of 2008 concerning the Government Internal Control System.
Regulation of the Minister of Home Affairs Number 20 of 2018 concerning Village Financial Management.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 Fatchur Rochman, Nurharibnu Wibisono, Herry Purnomo, Arini Wildaniyati, Pramita Mawar Dianti
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Abstract views: 0
,
PDF Downloads: 0
