Fraud and corruption as an object of internal audit in corporate governance

Abstract

Introduction. Fraud and corruption in the modern world is a pressing issue that significantly affects the functioning of the corporate sector and economic development in general. These phenomena generate serious losses for businesses, violate investor and consumer confidence, and undermine the effectiveness of the corporate governance system. Nevertheless, despite their importance, fraud and corruption remain complicated phenomena to detect and control. Therefore, internal audit is proving to be a key tool in combating these negative developments in corporate governance. It aims to identify, analyze and minimize risks related to fraud and corruption, as well as to improve the control and management system in accordance with best practices. The purpose of the paper is to analyze fraud and corruption as phenomena that affect corporate governance in order to identify their causes, forms, scope and consequences. Results. The paper examines the problem of fraud and corruption in organizations based on the complex interaction of economic, sociocultural and organizational factors. Different types of fraud and corruption such as financial manipulation, exploitation of conflict of interest, and misuse of resources are explored, as well as methods for identifying and analyzing potential fraud and corruption in organizations. Emphasized the importance of integrating these techniques into the internal control and audit system to ensure effective detection and prevention of fraud and corruption in organizations. The author presents the optimal principles that contribute to the effective role of internal audit in preventing fraud and corruption in organizations. Conclusions. Fraud and corruption, as an object of internal audit in corporate governance, are key aspects that require attention and systematic measures to detect, prevent and effectively control them. Detecting and eliminating fraud and corruption in organizations has a significant impact on business, including financial stability, reputation and efficiency. Solving these problems requires joint efforts on the part of all stakeholders, as well as the implementation of strategies and mechanisms aimed at counteracting and preventing the occurrence of such phenomena in the future.