This paper aims in design and implementation of Voice over Internet Protocol (VoIP) system with a high compression rate. The system uses a Raspberry Pi B+ ARM 11 microcontroller which is faster in processing the audio signal by means of CODEC2 software. An Audio Adapter (CM-108 or 109) is interfaced with the Raspberry Pi, which acts as a bridge in providing the processed voice signal to Raspberry Pi in its required PCM format. The setup is implemented in Local Area Network (LAN) in which the data transmission occurs. During the transmission of the data, the wireshark software was used to analyze the data in the network. A detailed analysis of the comparison results of different CODECs for compression rate and the estimated frame sizes are given. From the results, it is proved that the use of CODEC2 is an efficient system for VoIP. For secure communication, the AES encryption protocol with static private key was implemented. The 3.2Kbps compression technique is suitable for VoIP system as it has high compression rate and less delay compared to the other systems.