Organizational culture moderates the effect of bystander effect and internal control on accounting fraud trends in village credit institutions in Jembrana Regency

Abstract

This study aims to examine and explain organizational culture's role in moderating the bystander effect and internal control effect on the tendency of accounting fraud. The research was conducted on The Village Credit Institution in Jembrana Regency, with the respondents being managers and employees who worked at the Village Credit Institution. Data were collected using a questionnaire, analyzed using variant-based SEM, and processed using Partial Least Square (PLS). The study's results found that the bystander effect and internal control significantly affected the tendency of accounting fraud. Organizational culture can moderate the bystander effect's influence and internal control on the tendency of accounting fraud. The results of this study are expected to provide a systematic overview to The Village Credit Institution management in the future regarding the influence of the bystander effect and the weakness of internal controls on the occurrence of accounting fraud. Through the results of this study, the Village Credit Institution Supervisory and Management Agency is expected to eliminate the influence of bystanders, streamline the internal control system, and through a positive organizational culture, encourage the emergence of whistleblowers as an effort to prevent fraud. Keywords: accounting fraud tendency, bystander effect, internal control, organizational culture.