Fraud Prevention in the Village Fund System: A Case Study in Marga Mulya Village, Tangerang

The purpose of this study is to examine fraud prevention in the village fund system using the metrics stated in Permendesa No.19 of 2020. SISKEUDES were formed by the Financial and Development Supervisory Agency (BPKP) to enhance village government and financial management. Internal control is an important component in mitigating the possibility of village money being misused. The qualitative descriptive approach was used to conduct the research at Marga Mulya Village. Data was collected through interviews and observations, and data triangulation was employed as an analytical tool. Internal control in the village financial system has been implemented fairly effectively, according to the study’s results and discussion, as internal control efforts have been applied to each indicator in Permendesa No.19 of 2020. However, there is still a risk of fraud because various internal control indications that have been created have not been followed up on in a timely and appropriate manner.


INTRODUCTION
The village has the authority to administer the village fund to develop and preserve the welfare of the local community (UU No.6, 2014).A village has the right to organize and care for local community concerns, as well as to play a part in realizing the concept of independence.A village government is supposed to be more self-sufficient in carrying out potential resource supervision as well as managing its finances and assets (Rivan & Maksum, 2019;Saputra et al., 2021).The village also obtains the ability to receive money created locally, such as public business outcomes, mutual collaboration, assets, and so on.The village has the right to receive village money from the State Budget (APBN), Village Fund Allocation, and financial assistance from the Province and Regency or Municipal Government Budget (APBD), as well as grants or third-party donations (DJPK, 2019).
Transfer to Region and Village Fund (TKDD), part of State Expenditure, totalling Rp 569 trillion in 2022 (DJPK, 2022).The village fund has been given Rp 68 trillion in TKDD, and transfers to the region have totalled Rp 7 trillion.The Transfer to Region and Village Fund is the most important component of government spending (TKDD).Every receipt of the village fund collected must be properly handled and accounted for.In each budget year, the village head is required to report to the Regency or Municipal Head the implementation accountability realization result of the local government budget, compile the realization report of revenue and spending budget implementation, and arrange the accountability report of village revenue and spending budget implementation (Permendagri No. 20, 2018).
The central government has given a village fund management application called SISKEUDES to assist the village administration in preparing a high-quality financial statement (Bela & Utama, 2019;Budiati et al., 2020;Puspasari & Purnama, 2018).Since 2015, the SISKEUDES application has been developed to assist the village government system and community budget administration (Pratiwi & Pravasanti, 2020).The development of the village financial system is a government attempt to implement internal control in the village context, with the goal of preventing any harmful and unwanted fraud (Audela & Kristianti, 2022).To maximize village internal control, the government has issued an integral process system on action and activities conducted regularly by the chairman and staff to provide sufficient trust to achieve the organization's purpose through effective and efficient activities, financial reporting reliability, state asset security, and law compliance (Permendesa No.19, 2020).
Internal control at the Ministry of Village environment strives to supervise and promote technical executors and unit leaders to carry out the entity's function, responsibility, and authority effectively and efficiently.Internal control includes auditing, examining, assessing, regulating, and other supervisory operations on task management and organizational functions to provide enough assurance and effective and efficient established indicators to promote good governance.Internal control becomes a critical point to emphasize inside SISKEUDES owing to the availability of human resources in the village who are unable to execute SISKEUDES due to knowledge limitations (BPKP, 2018).
When a human resource is unable to run a system to its full potential owing to a lack of understanding, it might lead to an increase in corruption instances involving village money.This act of corruption is the result of the village control system's inadequacy (Saputra et al., 2021).A previous study on the use of SISKEUDES was conducted quantitatively by delivering questionnaires to village agencies in several subdistricts (Pratiwi & Pravasanti, 2020).A qualitative study is carried out to evaluate internal and environmental variables that impact SISKEUDES usage.This study will examine the internal controls used in villages as well as their compliance with government regulations.
A study aims to identify the difficulty in the SISKEUDES implementation and develop internal control as a means of overcoming the village fund problem (Wilma & Hapsari, 2019).Another qualitative study is carried out by analysing the application of internal control in the management of the village fund utilizing COSO internal control components (Handiyono & Lutfi, 2020).Because only four COSO internal control indicators have been achieved, it is recommended that a deeper promotion of the adoption of internal control on village management for village agencies be done.In contrast to earlier studies, this study employs internal control indications from new regulations (Permendesa No.19, 2020).
This study is being undertaken during the COVID-19 pandemic, which has certain constraints in terms of direct observation.This study will be conducted in Tangerang's Marga Mulya Village.Marga Mulya Village's Local Own-source Revenue (PAD) will be IDR 3 billion in 2021.President Joko Widodo's NAWACITA Program expresses a goal to empower districts and villages in Indonesia so that they may manage their resources freely.The government is assisting with this by releasing a village financial system to help with documentation, income management, and cash disbursement.
Marga Mulya Community began using SISKEUDES in 2016, which is directly controlled by a village treasurer who has completed some government training.The village treasurer not only follows the training at the start of the term but also participates in ongoing government training until now.Periodic training, strong control implementation, and a thorough understanding of the system are not always enough to mitigate the dangers that communities confront.Because both the village treasurer and the village secretary have access to the Marga Mulya Village SISKEUDES, double-entry is common.Furthermore, data loss has occurred as a result of a corrupted device.
The goal of this study is to investigate fraud prevention in Marga Mulya Village using the new rule and to describe the efficiency of internal control implementation in controlling the risks of the SISKEUDES.The findings of this study are intended to help Marga Mulya Village by providing extra information and evaluating the village's financial system's use by internal control regulations (Permendesa No.19, 2020).It can reduce the likelihood of fraud and inaccuracy.

LITERATURE REVIEW AND HYPO-THESIS Village Fund Systems
The Finance & Development Supervisory Agency released the Village Fund System application in 2015.(BPKP, 2018).This application is based on the village fund management regulation (Permendesa No. 19, 2020).This program streamlines the village management process, from planning to reporting.Payment request letters, receipt documents, budget plans, budget reports, tax payment slips, and administration reports are the documents that must be entered into the SISKEUDES.A Village Revenue and Spending Budget, a Village Asset Wealth Report, a Village Medium Term Development Plan (RJPM Desa), a Village Government Work Plan, a Local Government level compilation report, a Village Financial Administration Document, and a realization report for each source of funds are among the outputs of SISKEUDES.SISKEUDES is designed to help the village government produce a high-quality and effective report since the village government can develop a report or an accountability document by inputting data just once (Rivan & Maksum, 2019).The SISKEUDES application offers both merits and limitations.The problem is that new users find it difficult to comprehend how the upgraded program works, and there is no ongoing training.The availability of SISKEUDES to aid with village fund management, the existence of a supporting internal control system, and the provision of BPKP guidelines for usage are all strengths (Bawono et al., 2020;Pratiwi & Pravasanti, 2020).

Fraud Prevention
Internal control is an inherent process of activities and an activity performed regularly by both employees and leaders to ensure that objectives are reached effectively and efficiently (PP No.60, 2008).Internal control is a procedure carried out by an entity's personnel to ensure the achievement of three sorts of objectives: financial report dependability, operational effectiveness and efficiency, and compliance with applicable laws and regulations (Sugiyanto & Sumantri, 2019).In 2015, the Ministry of Village executed the village government's internal control system.The government internal control system, according to the regulation, consists of five components: the control environment, risk assessment and control actions, information and communication, and monitoring.
The control environment is the design and maintenance of the overall organizational environment that promotes good behaviour, supports existing internal control, and actualizes healthy management.The control environment is made up of standards, structures, and processes that serve as the foundation for implementing internal control in an entity and describe the owner's attitude toward internal control, the attitude of the entity's management as a whole toward internal control, and the importance of internal control in an entity (Audela & Kristianti, 2022).To analyse the control environment, various factors must be considered: integrity and ethics, organizational structure, human resource practices and policies, and involvement of the leader or audit committee.According to Village Fund Management, the organizational structure of the village must be transparent (Permendagri No. 20, 2018).Because he has a higher position than the secretary and treasurer, the Village Head has jurisdiction over all agencies.
Risk will always present while making a decision or carrying out action since risk cannot be avoided, just managed.Risks that are not identified and mitigated will impede the entity's ability to achieve its goals.Risk assessment is the second component of internal control.The risk assessment process provides an evaluation of the risks that entity units face both internally and outside.The risk assessment will entail identifying and analysing risks that are impeding the entity's ability to achieve its goals.The risk assessment will serve as the foundation for defining management and replacement to prevent the company from accomplishing its goals.To minimize risk, government agencies' objectives must be explicit, quantifiable, attainable, realistic, time-bound, and communicated to all personnel (Permendesa No. 19, 2020).
Control activities comprise processes and policies that will aid and assure the agency leadership direction is carried out, and control activity implementation must be carried out successfully and efficiently to achieve its objectives.Control actions may be used to avert issues by establishing explicit standard operating procedures, division of roles, and authorizations.Corrective controls to improve when problems arise that prevent the business from meeting its objectives, such as system repair for data inaccuracies, and detective action, such as applying existing controls and implementing them when issues arise, such as periodic audits or financial reconciliations.BPKP introduces SISKEUDES management principles and provides operator SISKEUDES training.Every village management should have operational standards, procedures, and organizational structure to ensure that every work is done successfully and efficiently.
In information and communication, information must be captured and reported to the entity's leaders and other stakeholders.Information can be delivered in a certain way and at a specific time so that leaders can carry out their responsibilities.Meanwhile, communication is the process of sharing existing knowledge with people who require it.Every transaction inside the company is initiated, recorded, and reported via information and communication.Every semester, the village treasurer is expected to present to the regency officer a report on the realization of the village budget's implementation (Permendesa No. 19, 2020).
Monitoring is the final procedure after having acceptable internal control.Monitoring ensures that internal control is carried out in accordance with established standard operating procedures or applicable regulations.Monitoring will assist staff in improving the quality of internal controls in order to achieve the entity's goals.Monitoring is also performed to ensure that the village adopts the recommendations, reviews, and audit results.Monitoring is available not just to internal officers, but also to regency officers (Permendesa No.19, 2020).The village officer should have regular internal and external reviews with the regency officer.

METHODS Data Collection
This study is being carried out in Marga Mulya Village in Tanjung Kait Disctrict, Municipality of Tangerang in Banten Province.This study examined the efficiency and effectiveness of internal control in the financial system of Marga Mulya Village using a qualitative descriptive method using a case study approach.The data utilized is original data derived from interviews.Mr Abu Bakar, the Head of Marga Mulya Village, Mr Andi, the Treasurer of Marga Mulya Village, and Mr Faisal Yusup, the Secretary of Marga Mulya Village, will be questioned.They have access to SISKEUDES and perform direct observation of Marga Mulya Village.The informants will be asked various open-ended questions on internal controls to restrict hazards in the use of SISKEUDES based on the signals of internal control elements (Permendesa No.19, 2020).Among the issues discussed are the control environment, risk assessment, control actions, information and communication, and monitoring.SISKEUDES' observations include how to log in to the program, input data, and financial reports, and how transfer the database to the regency officer.Not only should the SISKEUDES be observed, but so should the surrounding surroundings.Mr Abu Bakar, as Village Head, goes to the office every day to monitor all of the officers.The Village office appears to be pleasant and welcoming.In August 2022, an interview and observation of Marga Mulya Local were conducted directly at the Marga Mulya Village Office by seeing the Village Head monitoring the operations of village authorities and examining the SISKEUDES application in Marga Mulya Village.

Data Analysis
This study's data analysis involves triangulation data, which comprises reducing data, presenting data, and generating conclusions.The process of minimizing data includes selecting vital data, selecting material that is relevant to the study, and deleting data that is irrelevant to the investigation.After decreasing data, the following step is to convey the data.The presentation process involves preparing and presenting information and data from the reducing data process to help in the generation of conclusions.This study narratively offers the facts to make it easier to understand.Following the presentation of the data, the next stage is to take the essence of the study result and make conclusions.

RESULTS AND DISCUSSION
Marga Mulya Village is located in Banten Province's north western region.In 2021, the population of Marga Mulya Village is 37 people.Most inhabitants are under 30 years old and do not work.Madhato Beach is the only tourist attraction in Marga Mulya Village.Mr Abu Bakar is the village leader and is in charge of various Section Heads (KASI), including the Head of Service, the Head of Government, the Head of Welfare, the Head of Service, and several Heads of Affairs (KAUR), including the Head of General Affairs and the Head of Finance Affairs.Marga Mulya Village also employs operators and security personnel.
SISKEUDES is an application that assists village governments in managing village finances and in preparing highquality financial statements.Since 2016, Marga Mulya Village has been utilizing the SISKEUDES application.According to the testimony of Marga Mulya Village Secretary, who claimed, "SISKEUDES application may only be accessible by selected persons.Mr Andi, the Village Head, and Mr Abu Bakar cannot access it, but we will open it for him if he wants to see it." As the SISKEUDES operator, the Village Treasurer also attends district or regency training to increase its quality.There is also occasional marketing when the SISKEUDES application is changed or updated.Village Secretary said, "Yes, certain training is offered from the district or regency, especially when there is an update on the SISKEUDES, this year there has been updated four times due to the pandemic." Village officials and the district exercise control by forcing the village treasurer to upload data regularly.The submitted data will be immediately locked and cannot be changed again.The informant said, "We submit the data to the district and it will be locked automatically, so if we want to change it again, we cannot, we need to report it first to the district and then tell them that we want to change it because there are errors or new changes, after that the lock will be unlocked, and we can change it then." Fraud Prevention: Control Environment Marga Mulya Village is controlled by a village head who oversees three KAUR (Heads of Affairs) and three KASI (Heads of Section) with varied tasks and functions.
The General Affairs department is in charge of assisting the village secretary with all general administrative processes, archives, correspondence, and preparing village meetings or deliberations, whereas the Financial Affairs department is in charge of managing village financial administration, managing SISKEUDES, compiling reports on the implementation and accountability of the Village Revenue and Spending Budget, and preparing village meetings or deliberations (APBDesa).The Government Section is responsible for governance management, village profile management, social protection, peace, and discipline.The service department advises and motivates village inhabitants to participate actively in village activities such as mutual help, patrols, and community service, as well as to construct and expand community employment.The welfare branch is in charge of building rural infrastructure, developing the health sector (such as polyclinics), and education (such as schools).Each village employee is immediately overseen by the Village Head, who is assisted in direct control in the village office and during meetings by the Village Secretary.
If it is discovered that staff are incapable of carrying out their tasks, the Village Apparatus may be changed at any moment.Marga Mulya Village has been instances where one of its employees was unable to do their job.The informant said, "We replace jobs if there are village staffs whose performance is inept or neglects their tasks.We once fired a worker because his job was to pay taxes, but he didn't do so until the bills piled up.We scolded him at the time, and we also offered to replace the tax money, but that work had no good faith and never returned to the office for more than a week, and he was fired." The training and socialization process will surely contribute in the optimization of village personnel in carrying out their actions and obligations, guaranteeing that no incompetent village workers exist.A village apparatus's role includes decision-making.Marga Mulya Village makes decisions via deliberation.The Village Consultative Body (BPD), village public figures, the Community Unit (RW), and the Indonesian Family Welfare Guidance Program collaborate to hold the Village Deliberation (PKK).The ultimate conclusion is the result of the deliberation.

Fraud Prevention: Risk Assessment
An action has inherent risk.What can be done is detect it and keep it from having a big influence on activities.Manipulation and data misuse are quite likely if no internal control action is taken.As a result, as part of an internal control effort, village officials prohibit access to SISKEUDES.SISKEUDES access is restricted to the village treasurer, secretary, and head.According to the source, "To avoid incidents of fraud or data breaches, we limit SISKEUDES access to only two persons, myself and Mr Andi, the village treasurer.After that, every semester, we must submit data to the district, so there is someone who checks from the district as well.The village chief also checks things here." The use of a password to get access to SISKEUDES is an example of internal control.However, simply having a password is insufficient.To maximize security, passwords must be changed regularly to prevent hacking and password leaks.According to the following source, this is not executed by the village apparatus in Marga Mulya Village, "No, the password has not changed; we are frightened of forgetting it (the new password)." Because both the village secretary and the village treasurer have access to SISKEUDES and the capacity to input funds, the prospect of duplicate entry has never occurred in Marga Mulya Village.This was also revealed by the informant, "It had happened before in terms of data intake.I performed the input, and Mr Andi did the input as well, so it was doubled.Fortunately, I saw it right away and erased it." Fraud Prevention: Control Activities Marga Mulya Village's internal control effort in reducing fraud is the availability of Standard Operating Procedures (SOP).Various sources claim, "We were provided with the SOP in the form of a word document when we first started, and there was also a management group.We learnt it and read it on our own." SOP was only presented to village officials when they were hired, and they were never promoted again.This might lead to misinterpretation or misunderstanding of the SOP by local officials.Aside from SOP, village authorities are also expected to engage in Village and District reviews.According to the informant, "Our assessment is based on two sources from the village or district.The evaluation takes place every Monday, but it might also take place once a month.However, if specific issues need to be discussed, the district is typically accommodating." Fraud Prevention: consistency in controlling SISKEUDES, build internal controls, be more assertive, and undertake periodic audits of all present internal controls.
Information and Communication The local administrators have a WhatsApp group for communication.That group is used to organize and exchange information so that all village authorities, not just one, are aware of it.The informant mentioned this, "Because every district has an operator group, information on training is normally gathered from the group.In general, considerable information is obtained from there and shared with the village staff group.If the information is generic, such as residents receiving Covid, the Village Head obtained it first from the public health facility (PUSKESMAS).It will be shared with the village staff group so that we can get information from them."Any information gathered or those that demand debate will be resolved or addressed first during the village deliberation.The village deliberation is conducted in a flexible manner depending on the urgency.