The Influence of Internal Audit and Internal Control System on Financial Performance: The Moderating Role of Auditor Independence at KSPPS BMT Usaha Artha Sejahtera Bojonegoro

Abstract

This study aims to analyze the influence of internal audit and internal control systems on financial performance with auditor independence as a moderating variable at KSPPS BMT Usaha Artha Sejahtera Bojonegoro. This study uses a quantitative approach with a survey method. The research sample consisted of 51 respondents determined using a saturated sampling technique. Data were collected through questionnaires and analyzed using Partial Least Squares-Structural Equation Modeling (PLS-SEM) with the help of SmartPLS. The results show that internal audit and internal control systems have a positive and significant effect on financial performance. Auditor independence also has a positive and significant effect on financial performance. In addition, auditor independence has been proven to strengthen the influence of internal audit and internal control systems on financial performance. These findings indicate that increasing the effectiveness of internal audit and internal control systems supported by auditor independence can improve the financial performance of KSPPS BMT Usaha Artha Sejahtera Bojonegoro. This study provides an empirical contribution in the development of governance studies of Islamic microfinance institutions, particularly regarding the role of auditor independence in strengthening the effectiveness of the audit mechanism. This study aims to analyze the influence of internal audit and internal control systems on financial performance with auditor independence as a moderating variable at KSPPS BMT Usaha Artha Sejahtera Bojonegoro.