A comprehensive scientific review conducted by Suci Mulyani, Netty Herawaty, and Achmad Hizazi of Universitas Jambi concludes that organizations can significantly reduce fraud risks by integrating effective internal audits, robust internal control systems, and a strong ethical culture. Published in 2026 in the International Journal of Global Sustainable Research (IJGSR), the study synthesizes recent international evidence to explain why fraud prevention depends not only on formal procedures but also on organizational integrity.
The findings arrive at a time when fraud continues to threaten governments, businesses, universities, and public institutions worldwide. According to the Association of Certified Fraud Examiners (ACFE) 2024, organizations lose an average of 5% of their annual revenue because of occupational fraud. Beyond financial losses, fraud damages institutional reputation, weakens public trust, and undermines long-term organizational sustainability.
Why Fraud Prevention Still Matters
Fraud remains one of the most persistent governance challenges across both public and private sectors. While many organizations have established internal audit departments and internal control systems, fraud cases continue to occur because these mechanisms are often implemented inconsistently or operate independently rather than as an integrated system.
The Universitas Jambi researchers argue that preventing fraud requires more than compliance with regulations. Effective governance depends on coordinated oversight, professional auditors, responsible management, and an organizational culture that promotes integrity.
Their review also highlights Indonesia's continuing struggle with recurring weaknesses in internal control systems identified by national oversight institutions, emphasizing the need for stronger governance practices.
Reviewing Five Years of Global Research
Rather than conducting surveys or experiments, the researchers performed a Systematic Literature Review (SLR) using the internationally recognized PRISMA framework.
They searched four major academic databases—Google Scholar, Scopus, Web of Science, and SINTA-indexed journals—covering publications from 2020 to 2025.
The review process identified 87 relevant studies, which were narrowed to 20 high-quality peer-reviewed articles after systematic screening and full-text evaluation. The selected studies became the foundation for identifying consistent findings, common trends, and remaining research gaps in fraud prevention literature.
Key Findings
The literature review revealed several consistent conclusions across different countries and organizational settings.
Internal audit is most effective when:
- Auditors operate independently from management.
- Auditors possess strong professional competence.
- Senior management actively supports audit recommendations.
- Audit functions report directly to audit committees.
- Organizations adopt risk-based auditing instead of relying solely on compliance checklists.
Researchers found that risk-based auditing identifies fraud indicators much earlier, allowing organizations to reduce financial losses before fraud escalates.
The study also demonstrates that internal control systems serve as the organization's first line of defense. Effective controls include segregation of duties, authorization procedures, operational monitoring, restricted access to sensitive information, and continuous evaluation.
Importantly, the review found that many internal control failures result not from poor system design but from inconsistent implementation and inadequate monitoring. Organizations frequently establish sound policies but fail to enforce them consistently across departments.
Another significant finding concerns the causes of audit failure. The review identifies auditor pressure, insufficient competence, weak management commitment, and poor integration with risk management as major reasons why fraud remains undetected.
As digital technologies become increasingly sophisticated, fraud schemes are also evolving. Modern fraud often exploits information systems and digital processes that traditional auditing techniques may fail to detect, highlighting the growing importance of data analytics and technology-enabled auditing.
Integration Is More Powerful Than Separate Controls
Perhaps the study's most important conclusion is that internal audit and internal control should not operate as separate governance functions.
Instead, organizations should integrate internal audit, internal control, and enterprise risk management into a unified oversight framework based on the Three Lines of Defense model.
Within this integrated approach, internal controls establish preventive safeguards, while internal auditors independently evaluate whether those safeguards remain effective as organizational risks evolve. Together, these mechanisms create multiple layers of protection against fraud.
The review further shows that organizations with strong ethical cultures achieve substantially better outcomes because employees are more likely to follow control procedures out of personal integrity rather than fear of punishment alone.
Implications for Organizations and Policymakers
The findings have practical implications for a wide range of stakeholders.
Businesses can strengthen governance by improving auditor independence, investing in professional training, and integrating risk management with internal auditing.
Government agencies may use the findings to reinforce accountability systems and reduce opportunities for corruption.
Universities and educational institutions can incorporate these insights into accounting, auditing, and corporate governance curricula, preparing future professionals to address increasingly sophisticated fraud risks.
For policymakers, the review emphasizes that regulations alone are insufficient unless supported by ethical leadership, organizational transparency, and continuous monitoring.
The researchers also identify several priorities for future research, including greater attention to organizational culture, mixed-method research designs, longitudinal studies, and the application of artificial intelligence and data analytics in fraud detection.
Academic Perspective
According to Suci Mulyani and colleagues from Universitas Jambi, effective fraud prevention depends on the integration of competent and independent internal audits, consistently implemented internal controls, and an organizational culture built upon integrity and accountability. The authors emphasize that these elements function most effectively when they operate as a single governance ecosystem rather than as isolated mechanisms.
Author Profile
Suci Mulyani is a researcher at Universitas Jambi specializing in accounting, internal auditing, corporate governance, and fraud prevention. She co-authored this review with Netty Herawaty and Achmad Hizazi, both academics from Universitas Jambi whose research focuses on accounting, internal control systems, organizational governance, and risk management.
Source
Article Title: Systematic Literature Review: The Role of Internal Audit and Internal Control in the Prevention and Detection of Fraud
Authors: Suci Mulyani, Netty Herawaty, Achmad Hizazi
Journal: International Journal of Global Sustainable Research (IJGSR), Vol. 4, No. 6, 2026
DOI: https://doi.org/10.59890/ijgsr.v4i6.249
URL Resmi :https://slamultitechpublisher.my.id/index.php/ijgsr
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