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The roles of whistleblowing system and fraud awareness as financial statement fraud deterrent

Nanang Shonhadji (Department of Accounting, Sekolah Tinggi Ilmu Ekonomi Perbanas Surabaya, Surabaya, Indonesia)
Ach Maulidi (Business School, The University of Edinburgh, Edinburgh, UK and Department of Accounting, BINUS Graduate Program, Bina Nusantara University, Jakarta Barat, Indonesia)

International Journal of Ethics and Systems

ISSN: 2514-9369

Article publication date: 26 February 2021

Issue publication date: 16 July 2021

2363

Abstract

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.

Keywords

Acknowledgements

Retraction notice: The publishers of the International Journal of Ethics and Systems wish to retract the article: “The roles of whistleblowing system and fraud awareness as financial statement fraud deterrent”, by N. Shonhadji and A. Maulidi, which appeared in Volume 37, Issue 3, 2021, https://doi.org/10.1108/IJOES-09-2020-0140.

It has come to our attention that statistical errors are present within the article and therefore the findings cannot be relied upon.

As part of an investigation into the article’s findings, the authors were requested to provide a copy of the dataset so that the editorial team could verify the findings. The authors were unable to provide the dataset and stated they had committed statistical errors. The authors would like to note that any wrongdoing was unintentional.

This article has been retracted at the authors’ request.

The author and the International Journal of Ethics and Systems sincerely apologise to its readers.

Citation

Shonhadji, N. and Maulidi, A. (2021), "The roles of whistleblowing system and fraud awareness as financial statement fraud deterrent", International Journal of Ethics and Systems, Vol. 37 No. 3, pp. 370-389. https://doi.org/10.1108/IJOES-09-2020-0140

Publisher

:

Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

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