Abstract
Financial statement can show the company management performance after human resource trust. Each public company is obligated to reveal the annual financial report. This research examined correlation among profitability, liquidity, leverage and corporate governance to financial statement fraud and financial distress as mediation variable. Based on the Association of Certified Fraud Examiners (ACFE) 2016, the financial statement fraud continuously grew from 2012-2016. It means that there were more companies having financial statement fraud motivation. In this research, financial distress had been a mediation variable before the financial statement fraud event. This research applied quantitative research using the fraud diamond theory. This research proved that there was an impact of profitability, leverage, shareholder > 3% and directors quantity to financial distress. This research showed that the higher company’s profitability, the lower financial distress company risks. Based on the research, the companies that had financial distress would tend to do the financial statement fraud.
Highlights
Companies compose a financial statement to give information about financial condition, performance and position changing
This study examined the indirect influence among profitability, liquidity, leverage and corporate governance toward financial report dishonesty and financial distress
The decreasing of profitability would cause the occurrence of financial distress and vice versa
Summary
Companies compose a financial statement to give information about financial condition, performance and position changing. It is very beneficial to information usages regarding to economy decision taking (PSAK 1 2014). Financial statement can show the company management performance after human resource trust. Each public company is obligated to reveal the annually financial report. It is openly characterized to government and society, as stated to PP n.24 98. Verse 2, about financial information company annually. Based on Association of Certified Fraud Examiners (ACFE) periods 2012-2016, it was showed that the financial statement fraud grew globally. It means that there are many companies trying to manipulate the financial statement data
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
