An empirical analysis of asset misappropriation fraud during the COVID-19 crisis
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DOIhttp://dx.doi.org/10.21511/ppm.22(3).2024.25
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Article InfoVolume 22 2024, Issue #3, pp. 314-325
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Creative Commons Attribution 4.0 International License
The objective of this paper is to examine asset misappropriation fraud during the COVID-19 pandemic. The study examines the impact of four elements of fraud risk factors and Islamic religiosity on the propensity for fraud among employees who manage assets in government organizations. Data collection involved a questionnaire distributed to 210 employees responsible for asset management within the government organization in Indonesia. Partial least squares-structural equation modeling (PLS-SEM) was utilized as a statistical method. The test results show that the theoretical model is supported by empirical data. The study revealed that pressure, opportunity, rationalization, and capability positively influence asset misappropriation with a coefficient of 0.250, 0.134, 0.211, and 0.288, respectively. These results indicate that the higher the four fraud risks, the higher the possibility of asset misappropriation in the organization. On the other hand, Islamic religiosity exhibits a negative association with asset misappropriation with a coefficient of –0.113. These results indicate that religiosity plays an important role as a preventive factor in reducing the occurrence of asset misappropriation by employees. This study contributes to limited literature exploring factors influencing occupational fraud, specifically asset misappropriation during the COVID-19 crisis. The study recommends managerial strategies to mitigate asset misappropriation within the framework of the fraud diamond model.
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JEL Classification (Paper profile tab)M41, M42, G30, G34
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References50
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Tables6
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Figures2
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- Figure 1. Research model
- Figure 2. Structural model
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- Table 1. Respondent profile
- Table 2. Reliability and validity
- Table 3. Discriminant validity: Fornell-Larcker
- Table 4. Discriminant validity: HTMT ratio
- Table 5. Path coefficients and p-values
- Table A1. Questionnaire
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