Abstract
Complex factors trigger fraud. The basic theory is the fraud triangle theory. Crowe (2011) developed the idea into a pentagon theory and found two other factors: arrogance and competence. This study aims to analyze each element of Crowe's Fraud pentagon theory to detect fraudulent financial statements. Various proxies were used: pressure (financial targets and stability; external pressure; institutional ownership), opportunity (number of audit committees and nature of the industry), rationalization (change in auditors and auditor opinion), competence (change in directors and ineffective monitoring), arrogance (picture of the number of CEOs). Seventy-six banking companies listed on the IDX from 2013 to 2017 became sample. A multiple regression model is used as technique analysis. The results showed that pressure, rationalization, and competence affected financial statement fraud (FSF). This influence is in a good tone. This research contributes to the development of the Crowe's Fraud pentagon and Indonesian banking governance.
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