Risk Based Accounting in Realizing Reliable Financial Governance
DOI:
https://doi.org/10.62872/gb9fkt30Keywords:
accounting governance, financial risk, reliable governance, risk based accounting, transparencyAbstract
Reliable financial governance is a fundamental prerequisite for organizational accountability and sustainability. However, conventional accounting practices that emphasize historical reporting and formal compliance have shown limitations in addressing the growing complexity of financial, operational, and compliance risks in modern governance. This study aims to analyze the concept of Risk Based Accounting and its role in realizing reliable financial governance. The study employs a qualitative normative–conceptual approach through a literature review of accounting standards, financial governance principles, risk management frameworks, and reputable academic sources. The analysis examines the conceptual relationship between risk, accounting practices, and reliable financial governance. The findings indicate that Risk Based Accounting reorients accounting from retrospective, compliance-based reporting toward a preventive and forward-looking risk-based approach. Integrating risk into accounting practices enhances the quality of financial information, strengthens substantive transparency, and supports more accountable financial decision-making and oversight. This study concludes that Risk Based Accounting constitutes a strategic instrument for strengthening reliable financial governance, provided that it is supported by a clear conceptual framework and consistent normative harmonization.
Downloads
References
Abdallah, M. (2025). Ethical leadership, managerial risk-based incentives, and accounting conservatism: a comparative evidence from Egypt and Saudi Arabia. Future Business Journal, 11. https://doi.org/10.1186/s43093-025-00546-2.
Almaqtari, F. (2024). The Role of IT Governance in the Integration of AI in Accounting and Auditing Operations. Economies. https://doi.org/10.3390/economies12080199.
Bsoul, R., Alhammouri, A., & Alrabba, H. (2025). Quality of financial reporting and the practice of enterprise risk management: Evidence from listed United States industrial companies. Investment Management and Financial Innovations. https://doi.org/10.21511/imfi.22(2).2025.35.
Crawford, J., & Jabbour, M. (2023). The relationship between enterprise risk management and managerial judgement in decision‐making: A systematic literature review. International Journal of Management Reviews. https://doi.org/10.1111/ijmr.12337.
Dimes, R., & Molinari, M. (2023). Non-financial reporting and corporate governance: a conceptual framework. Sustainability Accounting, Management and Policy Journal. https://doi.org/10.1108/sampj-04-2022-0212.
Efunniyi, C., Abhulimen, A., Obiki-Osafiele, A., Osundare, O., Agu, E., & Adeniran, I. (2024). Strengthening corporate governance and financial compliance: Enhancing accountability and transparency. Finance & Accounting Research Journal. https://doi.org/10.51594/farj.v6i8.1509.
Fritz-Morgenthal, S., Hein, B., & Papenbrock, J. (2021). Financial Risk Management and Explainable, Trustworthy, Responsible AI. Frontiers in Artificial Intelligence, 5. https://doi.org/10.3389/frai.2022.779799.
Hadi, S. (2025). The Role of Financial Accounting in Supporting Investment Decision-Making and Achieving Financial Sustainability: An Applied Study on a Sample of Banks Listed in the Iraq Stock Exchange. Account and Financial Management Journal. https://doi.org/10.47191/afmj/v10i8.07.
Hu, Y. (2025). Risk management of accounting systems: Using artificial intelligence for real-time analysis and decision-making. Journal of Computational Methods in Sciences and Engineering, 25, 4802 - 4816. https://doi.org/10.1177/14727978251338006.
Isi, L., Ogu, E., Egbumokei, P., Dienagha, I., & Digitemie, W. (2024). Implementing Risk-Based Audit Systems to Improve Accountability in U.S. Affordable Housing Programs. International Journal of Social Science Exceptional Research. https://doi.org/10.54660/ijsser.2024.3.1.283-304.
Liu, Y. (2025). Research on the Early Warning Function and Implementation Path for Sustainability Accounting in Corporate Governance. International Journal of Education and Social Development. https://doi.org/10.54097/0rdzbg62.
Mujalli, A. (2024). Factors Affecting the Implementation of Risk-Based Internal Auditing. Journal of Risk and Financial Management. https://doi.org/10.3390/jrfm17050196.
Nwachukwu, P., Chima, O., & Okolo, C. (2025). The artificial intelligence governance framework for finance: A control-by-design approach to algorithmic decision-making in accounting. Finance & Accounting Research Journal. https://doi.org/10.51594/farj.v7i8.2016.
Onalaja, T., Nwachukwu, R., Bankole, F., & Lateefat, T. (2025). Digital Finance Transformation Model: Designing Risk and Control in Artificial Intelligence-Driven Accounting Systems. Engineering and Technology Journal. https://doi.org/10.47191/etj/v10i09.19.
Oriekhoe, O., Addy, W., Okoye, C., Oyewole, A., Ofodile, O., & Ugochukwu, C. (2024). The role of accounting in mitigating food supply chain risks and food price volatility. International Journal of Science and Research Archive. https://doi.org/10.30574/ijsra.2024.11.1.0340.
Setyawan, W. (2025). Bridging Between Financial Performance and Government Performance: The Role of Public Sector Accounting in Realizing Good Governance. Oikonomia : Journal of Management Economics and Accounting. https://doi.org/10.61942/oikonomia.v2i2.291.
Sugiyono. 2019. Metode Penelitian & Pengembangan. Alfabeta
Syah, S., Halmi, H., & Asikin, N. (2025). Implementation of Public Sector Accounting to Enhance Performance Accountability and Prevent Fraud: A Case Study at Minasa Upa Community Health Center. IJBAMS: International Journal of Business Accounting Management Social Science. https://doi.org/10.64530/ijbams.v1i2.19.
Tian, Z., Qiu, L., & Wang, L. (2024). Drivers and influencers of blockchain and cloud-based business sustainability accounting in China: Enhancing practices and promoting adoption. PLOS ONE, 19. https://doi.org/10.1371/journal.pone.0295802.
Upe, A., Asyary, A., & Rahman, M. (2025). Integrating Management Auditing With Social And Environmental Accounting: Case Studies From The Mining, Financial, And Technology Sectors. Li Falah: Jurnal Studi Ekonomi dan Bisnis Islam. https://doi.org/10.31332/lifalah.v10i1.12086.
Wang, Y. (2024). A Study on Financial Innovation and Risk Management Methods from an Accounting Perspective. SHS Web of Conferences. https://doi.org/10.1051/shsconf/202420001010.
Yahya, N., Nadzri, F., & Hossain, M. (2025). Conceptualizing the Digital Accountability in Fiscal Systems via Governance Framework for Enhancing Financial Integrity. International Journal of Academic Research in Progressive Education and Development. https://doi.org/10.6007/ijarped/v14-i3/26617.
Downloads
Published
Issue
Section
License
Copyright (c) 2026 Tharienna Dhesta Kusuma Dewi, Farkhatun Zaidah, Al Putri Oktavia (Author)
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
