Abstract
Objectives: This study aims to identify factors that influence the potential for fraud in Micro, Small and Medium Enterprises (MSMEs). This research is in line with SDG 16's goals of peace, justice and strong institutions. Theoretical Framework: The phenomenon of fraud and asset misappropriation is increasing globally, with asset misappropriation being the most common type of fraud in companies (86%) and a median loss of $100,000. Method: the research method includes the preparation stage, literature study for the preparation of research instruments, questionnaire preparation, pilot testing, data collection through questionnaires, and data analysis using validity tests, reliability tests, classical assumption tests, and hypothesis testing. Research Results and Discussion: The first important finding is that asset misappropriation that occurs in MSMEs based on the owner's perspective is not influenced by pressure, capability, and religiosity. The second important finding is that asset misappropriation that occurs in MSMEs based on the owner's perspective is influenced by opportunity, rationalisation, and integrity. This study failed to conduct a moderation test for the religiosity variable on the effect of the independent variable on the dependent variable. Research Implications: MSME owners must aware with the internal control system to minimise opportunities for misappropriation of assets by employees and must ensure and increase the loyalty and integrity of workers in MSMEs. Originality/Value: This study uses the religiosity variable as a moderating variable for factors that are thought to be the cause of asset misappropriation and looks at the occurrence of asset misappropriation from the perspective of business owners.
Published Version
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