Investigating the Role of Internal Control in Fraud Detection: Evidence from Companies Listed on the Palestine Exchange رسالة ماجستير

Abstract

This study aimed to explore the role of internal control in detecting fraud, with evidence drawn from companies listed on the Palestine Exchange. The study adopted a descriptive-analytical approach, utilizing a suitable quantitative research design. The study population included all Palestinian public companies listed on the Palestine Exchange. The sample size was (376) employees selected through a simple random sampling technique, and (369) questionnaires were retrieved, resulting in a response rate of (98.1%( The study found that gender significantly influences the effectiveness of fraud detection within internal control systems, suggesting that men and women may have different approaches to identifying fraudulent activities. However, other demographic factors such as age, educational qualifications, years of experience, and job title did not show any notable impact on fraud detection capabilities. In addition, the study emphasized the importance of key internal control dimensions, including the control environment, risk assessment, control effectiveness, information and communication, and monitoring. Each of these dimensions plays a vital role in creating a robust internal control framework that not only prevents fraud but also aids in its early detection. For instance, the control environment fosters an ethical culture, while risk assessment identifies potential fraud risks, and monitoring ensures continuous oversight. Companies listed on the Palestine Exchange demonstrated that strengthening these dimensions leads to better fraud detection, enhanced financial stability, and increased trust in governance. The findings suggest that organizations should adopt a comprehensive, integrated approach to internal controls to minimize the risk of fraud and ensure long-term financial health. Based on these findings, the study recommended the need for comprehensive strategies for fraud detection, which include periodic evaluation and system updates to enhance detection and prevention effectiveness. It also emphasized the importance of strengthening the control environment by organizing workshops and educational seminars to enhance organizational culture and ethical values, thereby contributing to increased adherence to internal policies. Additionally, the study stressed the need to enhance risk assessment mechanisms by leveraging advanced analytical techniques and expanding the scope of assessments to cover all aspects of operations