Corporate Governance, Effectiveness of Internal Audit Function and Fraud in Islamic Banking in Indonesia


  • Naufal Al Baqir Tazkia University College of Islamic Economics
  • Sulhani Sulhani Tazkia University College of Islamic Economics



Fraud, Internal Audit Effectiveness, Corporate governance


This research explores the correlation between corporate governance and the effectiveness of internal audit functions in preventing fraud within Islamic banking in Indonesia. This study uses 53 observational data sourced from the annual reports of Islamic banking in Indonesia for the period 2010-2019. The data were analyzed using linear regression. The results of this study indicate that corporate governance has no effect on fraud, while the effectiveness of the internal audit function is able to reduce fraud in Islamic banking in Indonesia. The implication of this research is that Islamic banking is expected to consider the effectiveness of the internal audit function in its formation, so that internal audit performance in fraud prevention can be carried out optimally.


ACFE Indonesia Chapter. (2019). Survai Fraud Indonesia 2019. Acfe Indonesia Chapter, 76.

Apriliani, A., Rozali, M., & Cakhyaneu, A. (2019). Prevention of Fraud in Sharia Banking in Indonesia through Implementation of Sharia Corporate Governance. KnE Social Sciences, 3(13), 183.

Petrescu, D., Tieanu, A. (2014). The Role of Internal Audit in Fraud Prevention and Detection. Procedia Economic and Finance, 16, 489–497.

Drogalas, G., Pazarskis, M., Anagnos-topoulou, E., & Papachristou, A. (2017). The Effect of Internal Audit Effectiveness, Auditor Responsibility and Training in Fraud Detection. Journal of Accounting and Management Information Systems, 16(4), 434–454.

Endah, N. (2020). The Implementation of Good Corporate Governance and Efforts to Prevent Fraud in Banking Companies. Jurnal Reviu Akuntansi Dan Keuangan, 10(1), 136–149.

Jannah, S. (2016). Pengaruh Good Corporate Governance terhadap Pencegahan Fraud di Bank Perkreditan Rakyat. Akrual, 7(2), 177–191.

Ghasemi, A., & Zahediasl, S. (2012). Normality Tests for Statistical Analysis: A Guide for Non-Statisticians. International Journal of Endocrinology and Metabolism, 10(2), 486–489.

Halbouni, S. S., Obeid, N., & Garbou, A. (2016). Corporate Governance and Information Technology in Fraud Prevention and Detection: Evidence from the UAE. Managerial Auditing Journal, 31(6–7), 589–628.

Najib, H., & Rini, R. (2019). Sharia Compliance, Islamic Corporate Governance Dan Fraud Pada Bank Syariah. Jurnal Akuntansi Dan Keuangan Islam, 4(2), 131–146.

Ngumar, S., Fidiana, F., & Retnani, E. D. (2019). Implications of Islamic Governance on Islamic Bank Fraud. Jurnal Reviu Akuntansi Dan Keuangan, 9(2), 226.

Rini, R. (2014). The Effect of Audit Committee Role and Sharia Supervisory Board Role on Financial Reporting Quality at Islamic banks in Indonesia. Journal of Economics, Business, & Accountancy Ventura, 17(1), 145.

Rohmatin, B. L., Apriyanto, G., & Zuhroh, D. (2021). The Role of Good Corporate Governance to Fraud Prevention: An analysis based on the Fraud Pentagon. Jurnal Keuangan Dan Perbankan, 25(2), 280–294.

Rowa, C. W. F., & Arthana, I. K. (2019). Pengaruh Good Corporate Gover-nance terhadap Pencegahan Fraud pada Bank Perkreditan Rakyat di Kota Kupang. Jurnal Akuntansi : Transparansi dan Akuntabilitas, 7(2), 122–137.

Saputra, A. (2017). Pengaruh Sistem Internal, Kontrol, Audit Internal dan Penerapan Good Corporate Governance Terhadap Kecurangan (FRAUD) perbangkan (Studi Kasus pada Bank Syariah Anak Perusahaan BUMN di Medan). Owner Riset & Jurnal Akuntansi, 1(1), 48–55.

Soleman, R. (2013). Pengaruh Pengendalian Internal dan Good Corporate Governance Terhadap Pencegahan Fraud. Jurnal Akuntansi & Auditing Indonesia, 17(1), 57–74.

Suzana, S., & Lestari, T. (2019). Penyebab Fraud pada Perusahaan di Kota Banjarmasin. Jurnal Bisnis Dan Ekonomi, 26(2), 114–122.

Trisasmita, R. (2018). Faktor-faktor yang Mempengaruhi Islamic Governance Perbankan Syariah di Indonesia. Al-Urban, 2(1), 81–91.

Urton L. Anderson., Michael J. Head., Sridhar Ramamoorti., Cris Riddle., Mark Salamasick., P. J. S. (2017). Internal Auditing Assurance & Advisory Service (4th Edition ed.). The Internal Audit Foundation.

Yusriwarti. (2017). Pengaruh Peran Audit Internal terhadap Pencegahan Kecurangan pada Perusahaan Perbankan di Pekanbaru. Jurnal Akuntansi dan Keuangan, 6(2), 1–13.




How to Cite

Baqir, N. A., & Sulhani, S. (2023). Corporate Governance, Effectiveness of Internal Audit Function and Fraud in Islamic Banking in Indonesia. Asia Pacific Fraud Journal, 8(1), 77–84.