The Effect of Financial Literacy and Financial Compliance on Financial Sustainability with Internal Control as a Mediating Variable
A Study at PT Sinar Niaga Sejahtera, Balinusra Region
DOI:
https://doi.org/10.61132/ijems.v3i3.1290Keywords:
Financial Compliance, Financial Literacy, Financial Sustainability, Internal Control, PLS-SEMAbstract
Financial sustainability is an important aspect for companies to maintain operational continuity, optimize resource management, and achieve long-term organizational objectives. This study examines the effect of employees’ financial literacy and financial compliance on financial sustainability, with internal control as a mediating variable at PT Sinar Niaga Sejahtera, Balinusra Region. The study addresses the need to strengthen financial sustainability by integrating employees’ financial capabilities, compliance with financial regulations, and effective internal control mechanisms. A quantitative explanatory approach was employed to examine the causal relationships among the research variables. Data were collected from 200 respondents using a saturated sampling technique and a Likert-scale questionnaire. The data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The results indicate that financial literacy and financial compliance have positive and significant effects on internal control. Furthermore, financial literacy, financial compliance, and internal control positively and significantly affect financial sustainability. Internal control also partially mediates the effects of financial literacy and financial compliance on financial sustainability. The R-square values of 0.682 for internal control and 0.698 for financial sustainability indicate that the model adequately explains variations in the endogenous constructs. These findings confirm that financial sustainability requires integrated improvements in financial literacy, compliance, and internal control.
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