Purpose

This paper aims to provide new theoretical discussion about the role of whistleblowing system and fraud awareness as an effective deterrent for financial statement fraud.

Design/methodology/approach

The authors conducted surveys to 13 reputable public accounting firms in East Java, Indonesia.

Findings

It is well acknowledged, as fraud attacks grow more sophisticated, whistleblowing system and fraud awareness can be possible deterrents. By increasing employees’ fraud awareness, they do not only recognise fraud symptoms and typologies but also support to raise concerns in good faith and on reasonable grounds. This study also suggests the role of fraud awareness as a human capital investment that increase sensitivity on identifying fraud symptoms and discouraging participation in crimes.

Originality/value

This study produces new theoretical discussion about fraud prevention. Then this study also offers several aspects that can help organisation to establish effective whistleblowing systems and reporting mechanisms. Those aspects identified can encourage an individual to report malpractice or wrongdoing. This study also offers how fraud awareness can support the implementation of whistleblowing system in preventing fraudulent financial statements and other irregularities.

中文翻译：

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举报系统和欺诈意识在财务报表欺诈威慑中的作用

目的

本文旨在就举报制度和欺诈意识作为有效威慑财务报表欺诈的作用提供新的理论讨论。

设计/方法/方法

作者对印度尼西亚东爪哇的 13 家知名会计师事务所进行了调查。

发现

众所周知，随着欺诈攻击变得越来越复杂，举报系统和欺诈意识可能会起到威慑作用。通过提高员工的欺诈意识，他们不仅可以识别欺诈症状和类型，而且还支持以善意和合理的理由提出疑虑。这项研究还表明欺诈意识作为一种人力资本投资的作用，可以提高识别欺诈症状和阻止参与犯罪的敏感性。

原创性/价值

这项研究产生了关于欺诈预防的新理论讨论。然后本研究还提供了几个方面可以帮助组织建立有效的举报制度和报告机制。确定的这些方面可以鼓励个人报告不当行为或不当行为。这项研究还提供了欺诈意识如何支持举报系统的实施，以防止欺诈性财务报表和其他违规行为。