Assessment of Financial Fraud Risks in Endowment Institutions: Through the Role of Governance Systems (A Field Study on Endowment Associations in the Kingdom of Saudi Arabia)

Document Type : Original Article

Authors

1 Assistant Professor of Accounting and Finance - Department of Business Administration, Applied College - King Abdulaziz University - Jeddah, Kingdom of Saudi Arabia.

2 Professor of Accounting - Department of Business Administration - Applied College, King Abdulaziz University - Jeddah - Kingdom of Saudi Arabia.

Abstract

The study aims to highlight the role of governance in reducing financial fraud risks in endowment institutions by analyzing the accounting and regulatory frameworks adopted in these institutions and determining their impact on mitigating financial risks. Endowment institutions face significant challenges due to their reliance on donations and grants, which exposes them to financial risks that may affect their sustainability and effectiveness. The study used a descriptive-analytical approach, collecting data through a review of literature and previous studies related to governance and financial risks, in addition to conducting semi-structured interviews with financial department officials in endowment institutions and using questionnaires to examine the relationships between governance and financial risks. The results revealed significant weaknesses in the accounting and regulatory systems of endowment institutions, including a lack of financial transparency, insufficient training programs for staff, and weak financial control. These factors make endowment institutions vulnerable to significant financial risks that could affect their ability to achieve their developmental goals. Based on these findings, the study recommended enhancing internal regulatory systems and strengthening the principle of accountability by clearly defining responsibilities and providing specialized training programs to improve staff efficiency. It also emphasized the importance of improving financial transparency and activating regulatory systems to ensure the sustainability of endowment institutions, increase trust among donors, and contribute to achieving their strategic goals and promoting sustainable social development.

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