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Original Research

RECONSTRUCTION OF AUDIT COMMITTEE ARRANGEMENTS IN FRAUD PREVENTION IN LIMITED COMPANIES

GUSTI AGUNG WISUDAWAN 1, ZAINAL ASIKIN 2, KURNIAWAN 3, and EDUARDUS BAYO SILI 4

Vol 19, No 12 ( 2024 )   |  DOI: 10.5281/zenodo.14598127   |   Author Affiliation: University of Mataram, Mataram, Indonesia. Email: 1agung.wisudawan@gmail.com 1,2,3,4   |   Licensing: CC 4.0   |   Pg no: 359-371   |   Published on: 27-12-2024

Abstract

Obstacles in corporate management are the emergence of fraud. Fraud is a violation of business ethics and the

principles of good corporate governance. Article 121 of Law No. 40 of 2007 concerning Limited Liability

Companies does not regulate the position of the Audit Committee and the Accountability of the Audit Committee

so that this will result in the absence of legal certainty and legal injustice.This study aims to discuss the nature of

the regulation of the position of the Audit Committee in a Limited Liability Company, the accountability of the

Audit Committee in preventing fraud in a Limited Liability Company, and the model for reconstructing the legal

accountability of the Audit Committee in preventing fraud in a Limited Liability Company. This research is a type

of legal researchnormative or doctrinal research by using Philosophical, Statute, Conceptual and Comparative

Approaches.The results of this study are the essence of the regulation of the position of the Audit Committee in a

Limited Liability Company as a business ethic based on the values of goodness, honesty and integrity, in addition

to being a reinforcement in order to make the principle of Good Corporate Governance (GCG) effective. The

accountability of the Audit Committee in preventing fraud as regulated in Article 121 paragraph (2) of the 2007

Limited Liability Company Law needs to be emphasized, namely being responsible to the Board of

Commissioners and the GMS can request information from the Audit Committee regarding the implementation

of its duties and functions if there is suspicion of fraud. The Reconstruction Model of the legal accountability of

the Audit Committee in the new Limited Liability Company Law regulates the position of the Audit Committee,

namely the objectives, authorities, obligations of the Audit Committee, term of office, requirements to become an

Audit Committee, the accountability system of the Audit Committee in a Limited Liability Company, the fraud

disclosure system or whistleblowing system and legal protection for reporters (Whistleblowers).


Keywords

Limited Liability Company, Reconstruction, Position, Audit Committee.