COSO-based internal controls and occupational fraud mitigation in Indonesian private universities

Abstract

Purpose: This study examines how the five COSO internal control components control environment, risk assessment, control activities, information and communication, and monitoring contribute to occupational fraud mitigation in Indonesian private universities. Occupational fraud is examined as a multidimensional construct comprising asset misappropriation, corruption, and financial statement fraud. Methodology/approach: A quantitative research design was adopted. Data were collected through structured questionnaires distributed to financial managers and officers responsible for internal control systems in large non-profit organizations. Partial least squares structural equation modeling (PLS-SEM) was used to test the relationships between COSO components and occupational fraud mitigation. Findings: The results show that the control environment, risk assessment, and monitoring are significantly associated with occupational fraud mitigation. In contrast, control activities and information and communication do not show statistically significant effects in the aggregate model. Practical and theoretical contribution/Originality: The study reconceptualizes internal control systems as ethical governance instruments and offers practical guidance for prioritizing high-impact control components. Research limitation: The cross-sectional, self-reported design limits causal inference and may involve common method bias. The focus on large non-profit organizations also limits generalizability.