AN EMPIRICAL ANALYSIS OF CONTROL ACTIVITIES IN MANAGING RISK FOR SUSTAINABLE MALAYSIAN MANUFACTURING SMEs

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Nor Hafizah Abdul Rahman Erlane K. Ghani Noradiva Hamzah Khairul Azman Aziz

Abstract

This study presents an empirical analysis of control activities among Malaysian manufacturing SMEs in managing risk of employee fraud for sustainable future SMEs. Continuous measurement, monitoring and evaluation of control activities are regarded as the basis to form effective controls against employee fraud. This study is based on an in-depth case study that examines how an organisation forms a good foundation of control activities to curb employee fraud in SMEs. Semi-structure interview was conducted with the owner of the three manufacturing SMEs from Food and Beverage industry. This study identifies and summarises the current control activities based on (1) response to objectives and risks, (2) design of appropriate types of control activities at various levels, and (3) segregation of duties. The result shows that most of the manufacturing SMEs implement control activities partially automated through the entity’s information technology system. This study provides a basis for several aspects of future research on other component of internal control by integrating each component in assessing business risk and explanation towards SME sustainability.

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How to Cite
ABDUL RAHMAN, Nor Hafizah et al. AN EMPIRICAL ANALYSIS OF CONTROL ACTIVITIES IN MANAGING RISK FOR SUSTAINABLE MALAYSIAN MANUFACTURING SMEs. Asia-Pacific Management Accounting Journal, [S.l.], v. 12, n. 2, p. 29-49, dec. 2017. ISSN 2550-1631. Available at: <http://arionline.uitm.edu.my/ojs/index.php/APMAJ/article/view/722>. Date accessed: 18 nov. 2018.
Section
Management Accounting