THE

EFFECT
OF
ETHICAL
JUDGMENT
AND
PROFESSIONAL COMMITMENT
ON EVALUATION OF
CONTROL ENVIRONMENT WITH WHISTLEBLOWING
INTENTION AS AN INTERVENING VARIABLE

ASTRID SYLVIA,et all

Present At The Fifth Asian Conference On Business & Public Policy 2014,20-23
November 2014,Osaka Japan

ABSTRACT
The purpose of this research is to analyze direct and indirect effect the
influence of understanding of ethical judgment and professional commitment on
evaluation of control environment with whistleblowing intention as an intervening
variable. Data of this research is primary data by way of distributing
questionnaires to the respondents. Sample of this research is obtained from
management of accountants who in BUMN(Governments) companies.Using path
analysis which a technique development of multiple linear regression.
The results of this research, in substructural 1 indicates that two independent
variables are ethical judgment and professional commitment, partially has direct
effect on the evaluation of control environment, and in substructural 2 indicates
that only whistleblowing intention, partially has direct effect on the evaluation of
control environment, so that overall substructural indicates that both ethical
judgment and professional commitment on evaluation of control environment has
an indirect effect through whistleblowing intention.
Keywords: Ethical Judgment, Professional
Intention, Evaluation of Control Environment.

INTRODUCTION

Commitment,

Whistleblowing

With the development of companies and the level of complexity of the

activities involved, the management company is no longer possible to carry out
the monitoring and supervision activities to the achievement of the set objectives.
These conditions ultimately requires the management to create an internal control.

Enron and Worldcom scandals shows how bobroknya internal control can cause
significant losses resulting in material misstatements in the financial statements.
Learning from the scandal, has good internal control is something that must be
upheld company. The control environment is the focus of the Enron scandal.
According to COSO, the control environment is the foundation of the system of
internal control. Enron in the control environment has seven main elements, the
implementation and the infraction assessed that there are major deficiencies in the
control

(http://uiacademica.wordpress.com/2013/03/05/kasus-enron-dalam-

keterkaitannya-dengan-coso-internal-control-integrated-framework/, accessed on
March 3, 2013). Accounting fraud cases such as Enron and Worldcom
whistleblower quits with presence.
Whistleblowing is an important issue in the field of ethics. This
whistleblower as a reminder or steering the company in order to stay on track.
Research Chiu, 2003 found that ethical considerations influence the intention to
make whistleblowing influenced by locus of control. Ethical considerations are a
factor for the onset of behavioral intentions on the moral issues that occur. The
role of ethical judgment is required in the event of a dilemma when choosing an
alternative decision regarding the company's internal controls.

Required professional conduct when ethical considerations. Professional

behavior is a form of commitment of professional accountants. An accountant
who has a high commitment to the profession, it will uphold the professional code
of ethics. According Rahadyan and Andi (2008), professional commitment is the
level of individual loyalty to the profession. An accountant who uphold
professionalism if found indications of accounting irregularities in the working
environment, it will immediately act to fix it. Evidenced by Yusar Sagara, 2013
that affect the professionalism of internal auditors perform whistleblowing
intentions.
Research Chris Patel (2003) prove that whistleblowing is an important factor
that contributes to the improvement of internal controls and the control
environment evaluation by management and the external auditors. Thus, the
application or whistleblowing system impacting a company's internal control
mechanisms, in particular the control environment.
Given these differences, the researchers wanted to test with the intention to
make whistleblowing as an intervening variable and the control environment as
the dependent variable, with the title "The Effect of Ethical Judgment and
Professional

Commitment

Evaluation

of

Control

Environment

With

Whistleblowing Intention As An Intervening Variable ". Case study: Management

Accountant who worked in the state-owned company with four categories, namely
mining and quarrying; procurement of gas, steam, and cool air; wholesale and
retail trade; information and telecommunications. From the fact,we want to know:
(1)What ethical considerations directly influence the evaluation of the control

environment (2) What is

a professional commitment directly influence the

evaluation of the control environment (3) What ethical considerations directly

influence the intention whistleblower (4) Is a professional commitment directly
influence the intention whistleblower (5) Is whistleblowing intention affect the
evaluation of the control environment (6) What ethical considerations do not
directly affect the evaluation of the control environment through whistleblowing
intention (7) Does not directly affect professional commitment to the evaluation of
the control environment through whistleblowing intention.
THEORETICAL FRAMEWORK
Theory of Reasoned Action
The theory of reasoned action introduced by Ajzen and Fishbein in 1980
Assumptions theory of reasoned action is based on the assumption that human
beings usually behave in a way that is conscious, that they consider the available
information, and implicitly and explicitly also consider the implications implications of actions - actions taken (Jogiyanto, 2007: 31).
Interests behavior (behavioral intention) and behavior (behavior) are two
different things (Jogiyanto, 2007: 25). Interest or intention is a desire to perform
the behavior. Behavior is the action performed real. Theory of Reasoned Action to
explain that behavior because the individual has an interest to do so (behavioral
intention).
The theory of reasoned action to explain that interest is a function of two
basic determinants related to personal factors and social influence (Jogiyanto,

2007: 31). Personal factors in the context of this theory is the individual's attitude
toward the behavior, whereas social influence in question is a subjective norm.
The theory of reasoned action applies to individuals who have the freedom to
choose the action to be performed.
Attitude toward behavior intention is to evaluate the trust (belief) or a positive
or negative feelings of a person if they have to do the behavior to be determined.
Determining other is subjective norm. Subjective norm is the perception or
view of a person to trust - trust that would affect the interest of others to perform
or not perform the behavior under consideration.
The combination of attitude toward behavior and subjective norm that has
shaped the behavior of individual interest (Jogiyanto, 2007). One's belief in the
love / not love an action combined with perceptions of the expectations of those
around him against such action will establish a person's interest in the action.
Perception
Perception can be defined as a process by which individuals - individuals
organize and interpret their sensory impressions in order to give meaning to their
environment (Robbins, 2008: 175).
Perception is influenced by several factors. Factors - these factors can be
located in the perception of self-forming, self-objects or targets in the interpreted,
or in the context of a situation in which the perception is made.

This affects the perception theory of reasoned action theory first proposed.
Perception plays a role in how people assess the actions of whistleblowing.
Perception is also able to explain the person's interest in doing whistleblowing. In
addition, perception plays a role also in the process of weighing the risk if
someone decides to do a whistleblowing.
Evaluation
Evaluation according to Wikipedia is the process of assessment. In the
enterprise, the evaluation can be defined as the process of measuring the
effectiveness of strategies used in order to achieve company goals.
Evaluation is an activity that compares the results of the implementation of
the criteria and standards that have been set to see its success. Of evaluation will
then be available information on the extent to which a particular activity has been
achieved so they can know if there is a difference between the standards set by the
results that can be achieved.
Internal Control
According to COSO in Internal Auditing Handbook The KH Spencer Pickett
(2010: 258):
Internal control is a process, effected by an entitys board of directors,
management and other personnel, designed to provide reasonable assurance
regarding the achievement of objectives in the following categories:
a.
b.
c.

effectiveness and efficiency of operations

reliability of financial reporting
compliance with applicable laws and regulations.

Components of Internal Control.

According to COSO in Theodorus Tuanakotta (2013: 128), internal control

consists of five components, namely:
a. Control environment
The control environment is the foundation for effective internal control. It
provides discipline and structure for the entity. It became a direction (it sets
the tone) for the entity, make employees aware of the control (control
consciousness) within the organization.
b. Risk assessment.
Entities assess the risk from the standpoint of a threat to the achievement
of entity objectives; of which is to produce financial statements that are free
from material misstatement.
c. Information systems.
Management and TCWG require reliable information to manage entities,
achieving the entity's objectives, and identify, assess and respond to risk
factors. It all requires the right information. Such information must be
identified, recorded, and communicated in a timely manner or distributed to
employees at all levels, who need to make decisions.
d. Communication
Communication is a key element in the success of information systems.
Effective communication internally, to help employees understand the purpose
of internal controls, business processes, and the roles and responsibilities of

each - each employee. It also helps them understand the relationship between
their activities with the activities of others, and how to - how to report
irregularities to the appropriate supervisor within the entity.
e. Control Activities
Control activities are the policies and procedures to ensure that the user
arrives and management directives implemented. Control activities designed
to address the risks that may occur in daily activities - such as transaction
processing and the security of assets.
f. Monitoring
Components of monitoring, assessing the effectiveness of internal control
performance over time. The aim is to ensure that the control is running as it
should, and if not then corrective action is taken.
1.1.1

Environmental Control

According to the Committee of Sponsoring Organizations or COSO's Internal

Control - Integrated Framework on books Arens (2012: 314), KH Spencer Pickett
(2010: 258), and Messier (2008: 200) sertaRobert Moller Brinks (2005: 84), there
are seven components of the control environment :
a. Integrity and ethical value
Is a product of the entity's ethical and behavioral standards and how these
standards are communicated and implemented in practice in the entity.
b. Commitment to competence
Competence is the knowledge and skills necessary to accomplish tasks.

c. Participation board of directors or audit committee

Effective commissioners are independent of management, and active
members and assess management activities.
d. Management's philosophy and operating style
All management actions will reflect on the importance of control of the
company to employees.
e. Organizational structure
The organizational structure defines how authority and responsibility are
delegated and monitored.
f. Assigment of authority and responsibility
These include environmental factors control how authority and
responsibility for operating activities are assigned and how reporting
relationships and authorization hierarchies are defined.
g. Human resource policies and practices.
Employees are competent and trustworthy is very important for internal
control. With the reliable employees, other control may be reduced because it
is very important, methods of appointment, evaluation, training, promotion
and compensation of employees is an important part of internal control.
Ethical Considerations
Ethical considerations arise when faced with an ethical dilemma situation.
Ethical considerations is defined as one's beliefs on ethical or not an alternative
(Vitell, Singhapakdi, Thomas, in 2001 in Hairul 2010). Ethical dilemmas rarely

involves choosing between two alternatives actually. In contrast, ethical dilemmas

usually arise because of the lack of choice which is entirely true. Instead, there is a
reason - a good reason for each alternative, so it is up to the individual to decide
which alternative will be chosen (Brooks and Dunn, 2011).
When individuals are faced with a situation that has moral and ethical
implications, they do not always agree on the issues at hand, the individual or
group will be affected and how, or what solutions or courses of action are
available or appropriate to deal with the situation. Such differences may be caused
by differences in the concept of individual justice and the different opinions about
the appropriate action to take in certain situations (Messier, 2008: 646). Some
difficult ethical choices simply because the temptation or pressure to pursue one's
self-interest, which may affect the assessment of what is right or wrong. Another
option is complicated by the sheer difficulty sorting out the problem and define
what action might be appropriate or not to take.
Research suggests that moral judgment develops over time and is a function
of age, education, and the complexity of the experience. Lawrence Kohlberg
argued that moral development has six stages that can be divided into three levels
of moral reasoning, the table below shows the six stages of Kohlberg models
(Messier, 2008: 646)
A phase refers to the mode or pattern of behavior that is characteristic of
some defined point in one's life. At preconventional level, an individual is
concerned only has its own importance. The rules imposed by others, and assess

an individual in terms of how well he obeyed. Small children are usually in this
stage of moral development.
At the conventional level, the individual is aware of others and the need to
conform to the norms of the group, he is concerned with public order and depends
on the laws and rules to guide him.
At the postconventional level, the individual recognizes society and the rule
of law with the settlement of the conflict situation impartially, using the principles
of universal moral and ethical as discussed earlier. Kohrlberg theory helps us
understand how our moral capacity to develop and demonstrate how we become
more experienced and critical in using and understanding the moral standard.
Professional Commitment
K.H. Spencer Pickett (2010: 266) describe that commitment mean the people
in the organization must understand and adapt to the identity and values of the
organization. This includes the values of ethics, integrity, human resources
policies, authority, responsibility and accountability, and mutual trust.
The term professional means a responsibility to behave much more than
meets the individual responsibility and the provisions of the rules and laws of
society (Amir Abadi Jusuf :,, 2011: 68). Professional conduct that is part of the
basic principles of professional ethics explained that an auditor must refrain from
any behavior that would discredit their profession, including negligence. They
should not be enlarged - exaggerate their qualifications or abilities, and should not
make comparisons harassing or without merit against competitors (Amir Abadi
Jusuf 2011: 69).

According Rahadyan and Andi (2008) in Yusar (2013), professional

commitment is the level of individual loyalty to the profession. So that one can
behave well, then that person should memeerhatikan professional ethics set out in
the code of ethics.
Aranya et al., 1981, p. Elias 272 in 2008 explained that professional
commitment is an attachment of individuals to their profession. Someone
committed professionals believe and accept the objectives of the profession and
willing to exert significant effort on his behalf.
According to the Elias Somers and Casal in 2008 to explain the relationship
between organizational commitment and whistleblowing intention. Organizational
commitment is defined as a situation in which an employee is in favor of a
particular organization and purpose - its purpose, and intends to maintain
membership in the organization. So high work engagement means siding on a
particular job; high organizational commitment means taking sides in the
organization that hired.
According to Aranya and Ferris (1984) in Laily (2010) defines commitment
as how strong professional recognition and engagement of a person in a
profession as well as his willingness to strive for the sake of the profession and a
desire to maintain a relationship with its members.
A committed professional who will carry out their professional
responsibilities and express the basic principles of ethical behavior that produces
respectable behavior, sometimes even sacrificing personal gain.
Whistleblowing

In order to achieve the effectiveness of internal control, then when viewed

from the sense of the word, meaning of whistle blowing whistle and blow that
whistle blowing means actually means blowing the whistle. According to Sonny
Keraf (1998) in the book Sukrisno Agoes (2009: 145), however, is actually meant
by whistleblowing in the context of ethics are:
"The action taken by a person or several employees to divulge
whether fraud committed by the company or his superior to others."
Witness and Victim Protection Agency (2011: ix) explains that the
whistleblower is usually addressed to the person who first reveal or report a crime
or an act deemed illegal in their work or others are, to the internal authority of the
organization or to the public such as mass media or public watchdog. While the
No. 4 SEMA 2011, the whistleblower can be defined as those who know and
report certain criminal acts and not part of the reported offenders. However, in
practice sometimes whistleblower also involved and has a minor role in the crime.
According to Velasques (2005) in the book Ernawan R. Erni (2007: 76)
There are two kinds of whistleblowing, namely:
1. Internal Whistleblowing, this occurs within the scope of the company's
internal, which are individuals who commit fraud at the company, and then
reported to the supervisor concerned, because his actions could hurt the
company.
2. External Whistleblowing, this happens if the cheating is his company, in
which its consequences have a negative impact on society, so that workers
reveal the fraud to the public. In general, this is an indication of the presence
of serious failures in the company's internal communication system, because

companies do not have policies or procedures that enable employees to

deliver clear consideration - their moral considerations beyond the standard
command.
Framework
This study examined the ethical considerations and professional
commitment to the evaluation of the control environment with the intention
whistleblowing as an intervening variable.

Ethical Judgment
(X1)

Whistleblowing
Intention

Evaluation of Control
Environment

Professional
Commitment

(X3)

(Y)

(X2)

Hypothesis
The theory of reasoned action to explain that a person's interest to behavior is
influenced by attitudes toward the behavior and subjective norm, which is a
combination of the expectations of those around him with the motivation to take
action in accordance with the expectations. Cognitive Moral Development theory
describes moral considerations (ethical judgment) evolve over time and in terms
of a function of age, education, and experience the complexity. Increasingly be at
a higher level, namely at the level of post-conventional, then the individual is

getting better at moral considerations for using ethical principles and rules of
society and the law recognizes in every settlement ethical dilemmas occur.
Accounting is one example of a profession that requires ethical considerations
at work. With the growing complexity of ethical dilemmas that occur requires
careful ethical consideration of an accountant. Ethical considerations an
accountant will determine the intentions of committing ethical and ultimately as
the output is their ethical behavior that impact on the users of the financial
statements. An accountant who has high ethical considerations will tend to
whistleblowing (Chiu, 2003).
H1: Ethical Judgment direct effect on whistleblowing intention.
Accountants are committed to the profession will trust and accept the purpose
of the profession and desire to strive to achieve their professional goals. The
purpose of their profession is to provide financial statement information that is
relevant and reliable for users. The ability to provide relevant financial reporting
and reliable professionalism is a reflection of an accountant. A professional
accountant who committed high, so that if he found any unethical practices on the
environment in which he worked, then he would immediately act to fix it,
evidenced by a study conducted by Rafik Elias (2008), which has a high
professional commitment will tend do whistleblowing (Elias, 2008).
H2: Professional Commitment direct effect on whistleblowing intention
With the advent of the desire to make whistleblowing, it will have an impact
or influence on the company's internal control because of the whistleblowing
system. The impact of the contribution made by management and the external

auditors as a company's internal control environment evaluation (Chris Patel,

2003).
Companies that have done the whistleblowing system may affect the
evaluation of the implementation of the control environment intenal companies.
The control environment is the foundation of all other control components. As an
example the case of Enron, the abominable environment they control until finally
appears whistleblower case, the impact on the destruction of the company and the
subject of evaluation of internal control of the government passed a law so that the
Sarbanes - Oxley.
H3: Whistleblowing Intention directly influence the evaluation of the control
environment.
An accountant who experience an ethical dilemma situation, and must make a
decision whether he should continue to follow or reject unethical practices that
occur in the work environment. The higher the ethical considerations, the higher
the accountant is able to prevent the occurrence of unethical behavior in the
neighborhood where he works. In COSO, integrity and ethical values is a product
of the entity's ethical and behavioral standards and how these standards are
communicated and implemented within the entity's practices. This means that
ethics is the formation of a good control environment.
H4: Ethical Judgment directly influence the evaluation of the control
environment.

Accountant with high professional commitment means he has a high level of

loyalty to the work that produces financial statements that are relevant and reliable
for users.
Evaluation of the control environment to talk about how the company
developed into a better direction or the so-called "improvement". According to the
founding father of the quality movement, Dr. Edwards Deming in Pickett (2010:
491), that continuous improvement must be commitment to change and
continuous improvement. A professional accountant who is committed to every
job will pay attention to every ethical behavior in the practice in the field. He
thought that if he did unethical practices in the internal enterprise, he will think
about the impact of the future, the future of the company where he works. An
accountant who uphold professionalism if found indications of accounting
irregularities in the working environment, it will immediately act to fix it.
H5: Commitment professionals directly influence the evaluation of the control
environment.
The word "judgment" on someone when faced with an ethical dilemma, it
will continue to the next stage which has the "intention" or the desire to act. From
that desire, then the final output is the "behavior". Thus, if an accountant has a
high ethical considerations, he will have any intention to make whistleblowing if
he finds unethical practices in the operation environment. If he had acted to report
it to the competent authority and there is a follow-up repair, then there will be a
change in the direction of improvement is better for the company, because of the
evaluation of the control environment.

In research Chiu (2003), ethical considerations have an influence on

whistleblowing intention means higher ethical considerations an accountant will
increase his or her intention to make whistleblowing if find any unethical
practices in the work environment, especially coupled with the already
socialization regarding whistleblowing system that addresses the importance of
report unethical practices are found in the work place. When an accountant
confronted with an ethical dilemma, ethical considerations it was working, he can
determine which practices are ethical and which are not.
The results of this study support the research Chiu (2003) who stated that
ethical considerations affect the whistleblowing intention with amplified by locus
of control. Research Barnett (1996) in Chiu (2003) also describes the relationship
between ethical considerations and interest in the behavior described empirically
related to whistleblowing.
H6: Ethical judgmnet do not directly affect the evaluation of the control
environment through whistleblowing intention
A professional accountant who committed high, so that if he found any
unethical practices on the environment in which he worked, then he would
immediately act to fix it, evidenced by a study conducted by Rafik Elias (2008),
which has a high professional commitment will tend do whistleblowing (Elias,
2008). A professional accountant who has a high commitment, then he will
always try to behave well with watching professional ethics set out in the code of
ethics (Yusar Sagara, 2013).

In principle, a whistleblower-or whistle-blower also called a 'prosocial

behavior' which emphasizes to help others in a healthy organization or company
(NCG, 2008). Healthy organizations means healthy companies from unethical
practices that occurred in the control environment. This indicates that the
whistleblowing intention mediates the relationship between professional
commitment

and

evaluation

of

the

control

environment.

H7: Professional Commitment indirect effect on the evaluation of the control

environment through whistleblowing intention.

METHODOLOGY
Research Object
The object of research is done on the internal accountant or also called
management accountants. Internal accountant is an accountant who works in a
company (for profit organization dedicated) or a non-profit organization (Haryono
2011: 7). Was chosen as a management accountant respondents aim to obtain valid
data in this research. Researchers conducted a survey of research on four
categories of state-owned companies in the mining and quarrying; procurement of
gas, steam, and cool air; wholesale and retail trade; as well as information and
telecommunications. Researchers selected a sample of BUMNs because BUMN is
a company that already has a whistleblowing system. Researchers chose these
four categories, because the companies that are included in this category, get a
whistleblowing system prior socialization than other categories.
Research Methods

This study uses quantitative methods. The quantitative data is in the form of
numeric data (Sugiyono, 2013: 23). The research method used in this study is a
survey method. The study was conducted using primary data through
questionnaires to the respondents, the management accountants who work in
state-owned companies.
The presence of intervening variables in this study, using path analysis (path
analysis). The analysis is performed using correlation, regression, and path, so it
can be known to get the last dependent variable, should be through a direct line, or
through an intervening variable (Sugiyono, 2013: 14).
Research Variables
Intervening Variabel
Intervening variables used in this study is whistleblowing intention.
Whistleblowing Intention is the desire to make whistleblowing (disclosure fraud)
conducted by the company or your boss privately to other parties, be it the public
or agencies or tops that are directly related to the conduct of the fraud (Ermawan
R. Erni, 2007: 76)
In this study using three measurement scenarios with see references from
research Yusar Sagara (2013), the measurement of these three scenarios developed
by Schultz et al. (1993) which has been widely used by previous studies, one of
which Elias (2008). Researchers make modifications to the questionnaire
research, in Yusar Sagara, a questionnaire intended for internal auditors, while the
research

is

intended

for

management

accountants.

There are three cases that were made by the researcher about the discovery of

the fraud committed by management; accountants know the bad consequences for
the company if the data adjustments of financial statements; and accountants are
required to commit fraud by inflating profits.
Questions - questions that are listed for the measurement of these variables
was supported Velasques (2005) in R. Erni Ernawan (2007: 76), someone will
make whistleblowing, if it is a part of its responsibilities, such as accountants; and
if it is felt to be detrimental to many people who pose a serious offense. Velasques
also explained, if doing whistleblowing, the whistleblower must be sure and
careful - careful in presenting the problem (backed up by facts - facts which
clearly and correctly), not hasty in spreading the problem, considering their
impact on yourself.
From the above, the dimensions of this variable is:
a. Level of responsibility in reporting whistleblowing
b. The seriousness of the case
c. The impact of personal risk if the whistleblower reporting
d. The desire to report to the higher management level
Dependent Variables
The dependent variable used in this study is the evaluation of the control
environment.

Evaluation is the process of assessment. In the enterprise, the

evaluation can be defined as the process of measuring the effectiveness of

strategies used in order to achieve company goals. The control environment is the
foundation for effective internal control. It provides discipline and structure for

the entity. It became a direction (it sets the tone) for the entity, make employees
aware of the control (control consciousness) within the organization.
According to the COSO internal control framework which identifies the
environmental factors controlling the research Lightle, et, al., (2007), there are
seven components of the control environment, namely:
a. Existence and implementation of codes of conduct and other policies
regarding acceptable business practices, conflicts of interest, or moral and
ethical standards of behavior expected.
b. The formation of "tone at the top" - including explicit moral guidance
about what is right and wrong - and the level of communication
throughout the organization.
c. Relationships with employees, suppliers, customers, investors, creditors,
competitors, auditors, etc..
d. The accuracy of the corrective actions taken in response to the beginning
of the policies and procedures approved.
e. Management attitudes towards the intervention or control established
major
f. Pressure to meet unrealistic performance targets - particularly for shortterm results - and the extent to which compensation is based on the
achievement of performance targets
g. Observation / participation in unethical behavior
Independent Variables
The independent variables in this study:
a.Ethical Judgment
One's judgment about whether or not ethical when faced with an ethical
dilemma situation that makes a person `identify alternatives - alternatives
available to resolve the dilemma (Arens, 2008 in Amir Abadi Joseph, 2012:

62).

Ethical judgment in this study is the consideration of an accountant in

determining the interest of response when faced with an ethical dilemma

situation. This variable is measured with instruments of the Lord and Dezoort
adopted in 1994 and 2001, researchers also see reference adopted by Siti
Jamilah (2007). Researchers make modifications to the measurement of this
variable. Because previous research intended reference auditors, while the
research is intended management accountants. Researchers make case
situation remains the same ethical dilemma that confronts accountants when it
finds violations committed by fellow co-workers, direct supervisor, and
executive level management.
Comprising three cases, case 1 accountant confronts a situation that
allows falsifying inventories, when a physical examination by the auditor, case
2 exposes accountants manipulate the company's financial position on
accounts receivable, and cases 3 confronts in knowing the financial statements
contained misstatements but remained neglected on the grounds not material.
Professional Commitment
K.H. Spencer Pickett (2010: 266) describe that commitment mean the people
in the organization must understand and adapt to the identity and values of the
organization. This includes the values of ethics, integrity, human resources
policies, authority, responsibility and accountability, and mutual trust.
The term professional means a responsibility to behave much more than
meets the individual responsibility and the provisions of the rules and laws of
society (Amir Abadi Jusuf :,, 2011: 68). Professional commitment in this study
was measured with a scale Dwyer et al (2000) which considers the professional

commitment as a model of the factors that affective professional commitment

(Elias, 2008). Affective commitment is defined as an emotional feeling for the
organization and belief in the value - value (Robbins, 2008: 101). This scale is
commonly used in the management literature, psychology and ethics in general.
Here are the five scale items (Dwyer et al, 2000):
a. I want to make a tremendous effort exceeds that expected for the success
or the success of my accounting profession.
b. I am proud to tell others that I was a part of the accounting profession.
c. Being a member of the accounting profession really inspired me to carry
out the work with the best - well.
d. I am very concerned with the fate of the accounting profession.
e. For me, being a member of the accounting profession is the best of the
other professions.
Sample .
The population of this research is the management accountants who work in
state-owned companies in the mining and quarrying sector. The sample of this
study using saturation sampling method, the sampling technique in which all
members of the population being sampled (Sugiyono 2011: 64)
Tabel 1
Sampling Procedures
Company

BUMN Category

Mining and
Quarrying

Procurement of gas,

Number
Dissemination
Questionnaire

1. PT. Pertamina

10

2. PT. Aneka Tambang, Tbk

10

3. PT. Tambang Batubara Bukit Asam, Tbk

10

4. PT. Timah

10

1. PT. Perusahaan Listrik Negara

10

steam, and air cooler

2. PT. Perusahaan Gas Negara, Tbk

10

Wholesale and retail

1. PT. Perusahaan Perdagangan Indonesia

10

1. PT. Telkom, Tbk

10

Information and
Telecomuunications

Source: Data processed by the author, 2014

Data Collection
The data source researchers on this paper are primary data and secondary
data. Primary data is data collected directly from the research is disseminated and
distributed questionnaires to candidates in the sample companies. The questions
are arranged with the Likert scale used. The Likert scale will produce interval data
(Sugiyono 2011: 31). Likert scale is used to measure the attitudes, opinions and
perceptions about one's social events or symptoms (Riduwan and Kuncoro 2011:
20). Measurement values from 1 to 5 points to get a range of answers strongly
agree to strongly disagree with the answer with a check mark () or a cross () in
the selected column.
Secondary data, a literature study in the library of indicators related
indicators, data search on the internet and writing the data obtained from the
company itself.
Method of Analysis
In analyzing the data, the authors use statistical analysis with SPSS (Statistics
Products and Services Solution) for the conclusion of the research object. The
data analysis technique used in this study is the analysis of the path. Path analysis
was used to analyze the pattern of relationships between variables in order to
determine the effect of directly or indirectly a set of independent variables

(exogenous) to the dependent variable (endogenous) in Riduwan and Kuncoro

(2011: 2).
RESULT AND DISCUSSION
Based on the results of data processing carried out on state-owned companies
in the mining and quarrying category; procurement of gas, steam, and cool air;
wholesale and retail trade; and information and telecommunications, the authors
will discuss the research that has been conducted in accordance with the problems
that have been proposed.
1. Direct Influence Ethical

Considerations

Against

Whistleblowing

Intention
High ethical considerations will notice norms - norms. Hypernorm is the
concept of business ethics that applies to the principle - the principle is more
fundamental, hypernorm evaluate the norm - the norm deeper, to the roots,
what is ethical for humanity. An accountant who noticed hypernorm will
uphold the values - the value of a business code of ethics universally
recognized. A whistleblower will see disclosure of accounting fraud is an
ethical act. And whistleblowing this is one manifestation of GCG.
Whistleblower will sacrifice himself for the sake of the interests of the public.
Stated that the Ministerial Decree No. Kep 117 / M - MBU / 2002 on the
implementation of corporate governance practices in SOEs, SOEs that will
increase the success of the business and corporate accountability in order to
create shareholder value in the long run to keep watching the interests of
other stakeholders, based on the regulations - regulations and value - the
value of ethics. GCG will make an accountant to apply all his behavior in

accordance with the principles of good corporate governance, including

2.

transparency, independence, accountability, responsibility, and fairness.

Direct Influence of Professional Commitment Against Whistleblowing
Intention
An accountant who is committed management professionals will adhere
to high standards of ethical conduct set forth by the IMA (Institute of
Management Accountants), namely competence, confidentiality, integrity,
and objectivity. Apart from having to adhere to professional standards, also
must comply with the laws and regulations applicable law, accountants
should avoid practices - unethical practices menlanggar law. Management
accountants must also comply with applicable company policies, one of
which supports the implementation of whistleblowing if it finds irregularities
which occurred in the practice of internal companies. With high professional
commitment, meaning the accountant can demonstrate its compliance with
standards, regulations and laws, as well as company policy. This was done to
his responsibilities to the public in order to present the financial statements of
relevant and reliable, which can be accounted to the users of financial

3.

statements.
Direct Influence of Whistleblowing Intention on Evaluation of Control
Environment
The implementation of whistleblowing systems to build awareness of the
practice - the practice of ethical or unethical. Whistleblowing systems can be
anticipation to control the company personnel to behave in accordance with
the corridor, if found, the unethical behavior of whistleblowing be a solution,

because the behavior of company personnel is a reflection of the

environmental control of the company concerned.
Control environment to deal with the management function
(management) and supervision (governance) at the highest level within the
entity. He also set the attitude, behavior, awareness berpengendalian, as well
as management measures and TCWG regarding the entity's internal control.
In an effective control environment, employees know that doing the right
thing expected and will be supported by upper management,. In a weak
control environment, control procedures are often changed or ignored, giving
4.

the opportunity for fraud occurred.

Direct Influence Ethical Judgment Against Evaluation of Control
Environment
The results showed that ethical considerations do not affect the
evaluation of the control environment. In COSO, integrity and ethical values
is a product of the entity's ethical and behavioral standards and how these
standards are communicated and implemented within the entity's practices.
This means that ethics is the formation of a good control environment. In this
study there is the word "judgment" or judgment that the theory of reasoned

5.

action (Jogiyanto, 2007: 25) is closely associated with "interest" or intention.

Direct Influence of Professional Commitment To Evaluation of Control
EnvironmentThe analysis showed that professional commitment does not
affect the evaluation of the control environment. Respondents demonstrated
high professional commitment, but it can be a good reason directly influence
the evaluation of the control environment. As mentioned before, the same as
ethical considerations, professional commitment becomes no effect due role

whistleblowing intention that more directly affect the evaluation of the

6.

control environment.
Indirect Influence Between Ethical Judgment On Evaluation of Control
Environment Through Whistleblowing Intention
The analysis showed that there is an indirect effect between ethical
considerations to the evaluation of the control environment through
whistleblowing intention as an intervening variable. The magnitude of the
total effect of ethical considerations to evaluate the control environment
through whistlebowing intention of 0.426 (0.522 x 0.817). It can be
interpreted that ethical considerations not directly affect the evaluation of the
control environment through whistleblowing intention as an intervening
variable.
Ethical judgment have a direct bearing on whistleblowing intention
means higher ethical considerations an accountant will increase his or her
intention to make whistleblowing if find any unethical practices in the work
environment, especially coupled with the already socialization regarding
whistleblowing system that discussed the importance of reporting unethical
practices found on the job. When an accountant confronted with an ethical
dilemma, ethical considerations it was working, he can determine which
practices are ethical and which are not.
As already explained that the accountant will have a higher ethical
considerations when faced with an ethical dilemma situation will impact the
material and has high impact and risk to the survival of the company in the
future. By looking at the impact of these materials, the emergence of
whistleblowing intention to perform will be stronger. Whistleblowing

intention became more powerful when involved are executive-level

management, as it is considered a fatal so it is necessary to evaluate the
7.

control environment for the improvement to a better direction.

Indirect Effect Between Professional Commitment On Evaluation of
Control Environment Through Whistleblowing Intention
The analysis showed that there is no direct influence between
professional commitment to the evaluation of the control environment
through whistleblowing intention as an intervening variable. The magnitude
of the total effect of professional commitment to the evaluation of the control
environment through whistleblowing intention of 0.312 (0.382 x 0.817). It
can be interpreted that the indirect effect of professional commitment to the
evaluation of the control environment through whistleblowing intention as an
intervening variable.
As explained COSO control environment that speaks about the
company's organization, which means dealing with environmental control
management function (management) and supervision (governance) at the
highest level within the entity. Thus, in principle, a whistleblower-or also
called whistle-blower was 'prosocial behavior' which emphasizes to help
others in a healthy organization or company (NCG, 2008). This indicates that
the whistleblowing intention mediates the relationship between professional
commitment and evaluation of the control environment. An accountant who
uphold professionalism if found indications of accounting irregularities in the
working environment, it will immediately act to fix it.
CONCLUSIONS, IMPLICATIONS, AND RECOMMENDATIONS

Conclusion

This study examined the influence of ethical considerations and professional

commitment to the evaluation of the control environment with the intention
whistleblowing as an intervening variable. Of the seven hypotheses were tested
from two substruktural, there are five hypotheses were accepted and two
hypotheses were rejected. Here are the results of research it can be concluded that:
1.

Ethical considerations directly influence whistleblowing intention. An

accountant who has high ethical considerations will notice hypernorm and
uphold good corporate governance practices so that when finding an
unethical practice, the intention to do any whistleblowing high, where

2.

whistleblowing is one manifestation of GCG.

Professional commitment directly influence whistleblowing intention. A
professional accountant who committed high, it will be aware of its
responsibilities to the public so that it will adhere to standards of ethical
behavior accountants, company policies, and laws and regulations

3.

applicable law, in which he would reject all forms of violations.

Whistleblowing intention directly influence the evaluation of the control
environment. The higher an accountant whistleblowing intention, then if
found unethical practices, he will try to immediately improve the control

4.

environment in which he worked to a better direction.

Ethical considerations do not have a direct influence on the evaluation of the
control environment. The word "judgment" is closely related with the
interest to do something that affects the occurrence of something, so it does
not have an influence on the consideration of the evaluation.

5.

Professional commitment does not have a direct influence on the evaluation

of the control environment. Commitment means loyalty to the profession,

6.

will be reflected from any actions that affect the sustainable improvement.
Ethical considerations have indirect influence on the evaluation of the
control environment through whistleblowing intention. Professional
judgment

an accountant

associated

with

the

intention

to

make

whistleblowing, which in turn contribute to evaluating the control

7.

environment of the company.

Professional commitment has indirect influence on the evaluation of the
control environment through whistleblowing intention. An accountant who
uphold professionalism if found indications of accounting irregularities in

the working environment, it will immediately act to fix it.

Implications
The implications of this study "The Effect of Professional Commitment and
Ethical Considerations Against Environmental Evaluation Control With Intention
Whistleblowing As an intervening variable" is:
1.

With the intention whistleblowing used as an intervening variable, as

employees of the company accountant will know whistleblowing is a
mechanism that could make the company into a strong control environment

2.

and always bring the company to a better direction.

To have high ethical considerations, an accountant needs to raise awareness
hypernorm high, so view and determine a course of action becomes an act
of whistleblowing and whistleblowing ethical is a GCG implementation that

3.

can be beneficial for the company stakeholders.

To have a commitment to high professional, an accountant must pay
attention to standards of ethical behavior in each treatment profession. That

way, a good accountant will comply with regulations and applicable laws
and policies the company where he works. As a result, the accountant will
be able to 'healthy' organization that became the company's internal control
environment and the work became well controlled.
Recommendations
Research conducted this time, there are some limitations as well the
suggestions of researchers on this study are:
1.

The sample of this study is limited to the management accountant from

BUMNs with four categories, then for further research, the sample coverage
accountant who is used as a respondent should be enlarged by the addition
of a category of BUMNs or non-BUMNs distinguish samples, such as

2.

accountant of a private company or a government.

Study period short enough lead researcher only took samples that have
implemented whistleblowing system. It is advisable to further research, not
only for researching companies that have implemented whistleblowing
system but also examines companies that have not implemented a
whistleblowing system. Researchers can separate the two groups, whether it

3.

will have the same results or different studies.

Coefficient of determination there are other independent variables that
explain the dependent variable whistlleblowing intention and evaluation of
the control environment in this paper. Researchers can then be performed

4.

using other factors, such as socialization whistleblowing system.

For BUMNs, to hold regular seminars to engage accountants - accountants
and executive level management to follow the whistleblowing system
socialization program organized by the government.

5.

For accountants, it takes more awareness and motivation by applying higher

standards of ethical behavior to improve the ethical considerations and

6.

professional commitment in carrying out his profession.

For the government, the government needs to tighten policy further promote
and regulatory whistleblowing system in state-owned enterprises that
effective implementation and corporate governance objectives were
achieved. As well, the government needs to expand socialization
whistleblowing system not only in state-owned enterprises, but also in other
types of companies.
ACKNOWLEGMENTS

Thank you to Cand.doktor Etty,Yunika Msi, Marsellisa,MSc and Cand.Doctor Indra who
helped us to edit this research. Our special thanks to the IAFOR

2014 OSAKA

Conference who gave us the chance to present our paper.

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