Risk Management Based on Internal Control Environment for Top Cooperative in Malaysia
Pengurusan Risiko berdasarkan Persekitaran Kawalan Dalaman terhadap Koperasi Terbaik di Malaysia
Keywords:
Risk Management, Internal Control Environment, Business Structures, Business Philosophy, CompetenceAbstract
The purpose of this article is twofold. First, it detects the relationship of the internal control component (IC) with risk management from top cooperatives in Malaysia. Second, this article provides an assessment of risk management predictor (RM) models based on the ICs component. This study adopted a survey study using a quantitative approach. Prospective populations are managers, staff, and members of top cooperatives. This survey was adapted from the COSO framework (2013). Data is collected online using google forms. The data obtained were analyzed by the Pearson Correlation to find the relationship between IC and RM. Multiple regression model is used to test whether the IC component has an influence on RM and which IC component acts as the main determinant of RM. The findings of this study indicate that the components of ICs especially business structure, business philosophy, and allocation of power and responsibility are strong contributors to RM. This shows that cooperatives must consider the role of IC in risk management. Implications of these findings for cooperative risk management are discussed.
Tujuan artikel ini dua kali ganda. Pertama, ia mengesan hubungan komponen kawalan dalaman (IC) dengan pengurusan risiko dari koperasi teratas di Malaysia. Kedua, artikel ini memberikan penilaian model peramal pengurusan risiko (RM) berdasarkan komponen IC. Kajian ini mengadopsi kajian tinjauan menggunakan pendekatan kuantitatif. Calon populasi adalah pengurus, kakitangan, dan anggota koperasi teratas. Tinjauan ini diadaptasi dari kerangka COSO (2013). Data dikumpulkan dalam talian menggunakan borang google. Data yang diperoleh dianalisis oleh Pearson Correlation untuk mencari hubungan antara IC dan RM. Model regresi berganda digunakan untuk menguji sama ada komponen IC mempunyai pengaruh pada RM dan komponen IC mana yang bertindak sebagai penentu utama RM. Dapatan kajian ini menunjukkan bahawa komponen IC terutamanya struktur perniagaan, falsafah perniagaan, dan peruntukan kuasa dan tanggungjawab merupakan penyumbang kuat kepada RM. Ini menunjukkan bahawa koperasi mesti mempertimbangkan peranan IC dalam pengurusan risiko. Implikasi penemuan ini untuk pengurusan risiko koperasi dibincangkan.
Downloads
References
Abd Aziz, M, A., Said, J., & Alam, M, M, (2013). Assessment of the Practices of Internal Control System In The Public Stores Of Malaysia. Asia-Pacific Management Accounting Journal, 10 (1).
Abdul Malek, R., Shaarani, A, F., Said, A., Ariffin, A., & Mohamad Radzi, I, N, A. (2017). Pelaksanaan Pengurusan Risiko Dalam Gerakan Koperasi Di Malaysia. Malaysian Journal of Co-operative Studies.13, 13-30.
Ariffin, A., Mohd Hanif, F., Ali, S., & Abdul Razak, N, A., (2016). The Implementation of Internal Control Control System Among Malaysian Credit Co-Operatives. Malaysian Journal of Co-operative Studies,12, 1-20.
Abdolmohammadi, Gerrit Sarens, Mohammad J., Rainer Lenz, (2011),"Factors associated with the internal audit function's role in corporate governance", Journal of Applied Accounting Research, 13 (2), 191 – 204.
Bayyoud, M., & Sayyad, N., A., (2015). The Impact of Internal Control and Risk Management on Banks in Palestine. International Journal of Economics, Finance and Management Sciences. 3(3), 156-161.
CPA Australia (2011). Internal Controls For Non-Profit Organization. CPA Australia Ltd, Victoria.
Committee of Sponsoring Organisations of Treadway Commission (2004), “Internal control—integrated framework”, The Committee of Sponsoring Organizations of the Treadway Commission.
Committee of Sponsoring Organisations of Treadway Commission (COSO, 2013) “Internal control—integrated framework, executive summary.” The Committee of Sponsoring Organizations of the Treadway Commission.
Haron, H., Ibrahim, D. D. N., Jeyaraman, K., & Chye, O. H. (2010). Determinants of internal control characteristics influencing voluntary and mandatory disclosures: A Malaysian perspective. Managerial Auditing Journal, 25(2); 140-159.
Irzan Ismail., Nik Mutasim Nik Abd Rahman., Mohamad Abdul Hamid., & Fazli Idris. (2012), Assessing employee affective commitment as a mediator on the relationship between risk assessment and effective enterprise risk management (ERM). Journal of Business and Policy Research, 7(3), 60-77.
Islamic Financial Services Council (IFSB) (2005), Guiding Principles Of Risk Management For Institutions (Other Than Insurance Institutions) Offering Only Islamic Financial Services, Issue December 2005.
Gesare, M, R., Michael, N., & Odongo, A, J, (2016). Influence of Internal Control Systems on Fraud Risk Management among Commercial Bank in Kisii Town, Kenya. IOSR Journal of Business and Management, 18 (4), 28-34.
Khamis (2013), "Contribution of the internal Control system to the financial performance of financial institution: A case of people’s bank of Zanzibar Ltd.
Khorwatt, E, (2013). Assessment of Business Risk and Control Risk in the Libyan Context, Open Journal of Accounting, 4, 1-9.
Khorwatt, E. and Ritchie, B.(2015) The Attitude of Libyan Auditors to Inherent Control Risk Assessment. The British : Accounting Review, 39-59.
Lembaga Perkhidmatan Kewangan Islam. (2005). Guiding principles of risk management For institutions (Other than insurance institutions) offering only Islamic financial service.
Mahadeen, B., Al-Dmour, R., H., Obeidat, B., Y., & Tarhini, A., (2016). Examining the Effect of the Organization’s Internal Control System on Organizational Effectiveness: A Jordanian Empirical Study. International Journal of Business Administration, 7 (6), 22-41.
Mawanda, S.P. (2008), “Effects of internal control systems on financial performance in an institution of higher learning in Auganda”, thesis and Dissertations, available at: http://hdi.handle.net/123456789/53
Norwatim, A, L. (2011). Tahap Pengambilan Risiko Dalam Gerakan Koperasi Di Malaysia. Malaysian Journal of Co-operative Studies, 7, 103-118.
Pallant, J. (2011) SPSS Survival Manual. 4th Edition, Allen & Unwin, Crows Nest.
Rejda, George E., (2005), Principles of Risk Management and Insurance, 9th Edition, Emeritus; University of Nebraska, Pearson.
Rittenberg L.E., Schwieger B.J., 2005. Auditing. Concepts for a Changing Environment, Thomson South Western, USA, 288.
Rosman, R, I., Shafie, N, A., Mohd Sanusi, Z, Johari, R, J., & Omar, N. (2016). The Effect of Internal Control Systems and Budgetary Participation on the Performance Effectiveness of Non-profit Organizations: Evidence from Malaysia. Int. Journal of Economics and Management 10 (S2): 523 – 539.
Suruhanjaya Koperasi Malaysia, SKM. (2010). Garis Panduan Penubuhan Koperasi (GP12). Kuala Lumpur: Suruhanjaya Koperasi Malaysia.
Suruhanjaya Koperasi Malaysia, SKM. (2012). Penyeliaan risiko koperasi priskop. Kuala Lumpur: Suruhanjaya Koperasi Malaysia.
Suruhanjaya Koperasi Malaysia, SKM. (2012). Rangka Kerja Penyeliaan Koperasi (RKPK). Kuala Lumpur: Suruhanjaya Koperasi Malaysia.
Suruhanjaya Koperasi Malaysia, SKM. (2016). Penubuhan Koperasi di Malaysia. Kuala Lumpur: Suruhanjaya Koperasi Malaysia.
Spitzer, E. (2005). Internal controls and financial accountability for not-for-profit boards. New York, NY: Little, Brown.
Downloads
Published
How to Cite
Issue
Section
License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
