Effectiveness of Internal Control System as Early Detection Tool in Fraud Prevention of Village Fund Management

Abstract

Introduction: The Village Fund is a form of trust from the central government to plan and implement programs and activities in its village. The increasing number of village funds disbursed by the government is not in line with good management. Research Objectives: To analyze the effectiveness of the internal control system as a tool for detection early in pre-venting fraud in the management of village funds. Methods: This research is qualitative. The object of this research is eight districts and 30 sub-districts as research samples in Central Java Province. This study's data analysis techniques were done through data reduction, presenta-tion, and conclusion drawing. Conclusion: From the results of data analysis in the field, it can be concluded that fraud in the management of vil-lage funds is generally caused by the non-functioning role of village assistants in managing village funds. Weak guidance and supervision from various parties that should be the duties and responsibilities of the agency, including the Subdistrict head, the Government Guard and Security Team and the Development of the Semarang District At-torney, the Body Consultative Village, which seems to be just a formality and most importantly the weak community participation, which is caused by lack of understanding of the community towards village development budgets and plans and incompetence of human resources (HR) managing village funds and village heads.