Jai | Journal of Accounting and Investment, vol. 19 no. 2, July 2018 Does Type of Fraudulent Act Have an Impact On Whistleblowing Intention? Caesar Marga Putri* ABSTRACT: The purpose of this research is to examine empirically the impact of two types of fraudulent act on individual’s reporting intention under reward model. This research applied the Reinforcement theory in designing whistleblowing policies. In this context, reward system in encouraging disclosure of fraudulent act was used. This study was designed using experiment method 2x2 between subjects with 86 participants from private universities. Sarbanes-Oxley Act of 2002 requires that every public company must establish anonymous channel regarding disclosure of fraudulent act. However, under the reward system it may become different prediction that non-anonymous channel is preferable than the other one. Using two types of fraudulent act, this research investigated whether those types affected individual’s intention for disclosing fraud in choosing the reporting channel because a reward is provided or not. The result shows that the interaction between the type of fraudulent act and type of channel could encourage individual’s intention to blow the whistle. However, individual prefers to report the misappropriation of asset through anonymous channel than non-anonymous even though a reward is provided. KEYWORDS: reward system; type of fraudulent act; whistleblowing intention Introduction The purpose of reporting fraud in the organization is to achieve economic goal as well as social goal. In order to achieve those goals, support from others is needed by whistleblower, even though fact shows that whistleblowers will get lots of harms. Elliston (1982) states that employee only has a little right and will be refused by other employees. Retaliation is one of the negative consequences for whistleblower. There are a lot of studies concerning retaliation on employee who blow the whistle, one of them is a study conducted by Liyanarachichi and Newdick (2009). Reporters of wrongdoing probably expect a strong procedural protection to hide identity (Kaplan, Peny, Samuels & Zang, 2009). Whistleblowing as an effective mechanism for disclosing corporate fraud is highlighted by the disclosure of the biggest reporting scandal that involves two corporations in United States: Enron and WorldCom (Bowen, Call & Rajagopal, 2010). In Indonesia, one of the whistleblowing cases has been conducted by the former head of Indonesian National Police's Criminal Investigation Agency who disclosed corruption scandal that happened in the police department (Lestari & Yaya, 2017). The importance of whistleblowing to disclose corporate malfeasance encourages regulator for creating effective ways to disclose wrongdoing in organization. Section 301 & 806 of Sarbanes-Oxley Act 2002 are designed to encourage whistleblowing and provide safety from retaliation. Section 301 and 806 require audit committee of corporate director that already Department of Accounting, Universitas Muhammadiyah Yogyakarta, JL. Brawijaya, Tamantirto, Kasihan, Bantul, Yogyakarta Special Region, Indonesia *Correspondence: caesar.margaputri@umy.ac.id This article is avalilable in: http://journal.umy.ac.id/index.php/ai DOI: 10.18196/jai.1902102 Citation: Putri, C. M. (2018). Does Type of Fraudulent Act Have an Impact On Whistleblowing Intention?. Journal of Accounting and Investment, 19(2), 210-225. Received: 11 April 2018 Reviewed: 30 April 2018 Revised: 10 May 2018 Accepted: 24 July 2018 Copyright: © 2018 Putri. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.