Dian Anita Nuswantara, Ach Maulidi, Pujiono
In a globalised scenario, the topic of an enormous increase of malfeasance in the local governments, posing catastrophic threats which come from vicious bureaucratic apparatus, becomes a global phenomenon. This current study uses case study material on the risk management control system specially the control environment in Indonesia local governments to extend existing theory by developing a contingency theory for the public sector. Within local government, contingency theory has emerged as a lens for exploring the links between public sector initiatives to improve risk mitigation and the structure of the control system. The case illustrates that the discretion of control environment – the encouragement of a local government’s control environment – is considered as a springboard for fraud deterrence and might be the loopholes in the government control systems. © 2017, Editura Economica. All rights reserved.
Universitas Negeri Surabaya, Indonesia
