EVALUATION OF INTERNAL AUDIT IN MINIMIZING NON-PERFORMING FINANCING TO SUPPORT GOOD CORPORATE GOVERNANCE IN ISLAMIC BANKS

Abstract

This study aims to evaluate the role of internal audit in minimizing non-performing financing and its contribution to supporting the implementation of Good Corporate Governance (GCG) in Islamic banks. Non-Performing Financing (NPF) is one of the major risks that may affect the financial stability of Islamic banking institutions. Internal audit plays an important role in ensuring the effectiveness of the internal control system, maintaining compliance with Islamic principles, and managing financing risks. This research employs a descriptive qualitative method through a literature review of various scientific journal sources. The findings indicate that effective internal audit practices can enhance transparency and accountability, while also reducing the level of non-performing financing, thereby supporting a more optimal implementation of Good Corporate Governance in Islamic banks.