Forensic Accounting Services Research Articles

Factors Influencing the Attitude and Behavioral Intention of Auditors for Use of Forensic Accounting Services: A Study on Banking Industry of Pakistan

The increase in fraud action against financial reports makes many people uneasy and considering to use Forensic Accounting Services (FAS) to prevent and detect fraud. The Theory of Reasoned Action (TRA), formulated by Fishbein and Ajzen, is pivotal in elucidating the determinants of specific professional behaviors, especially in sectors where compliance and ethical standards are strictly monitored like auditing. This study aimed to analyze the factors affecting the Behavioral Intention of Auditors to Use Forensic Accounting Services in the Banking Industry of Pakistan with the mediating effect of Attitude of the Auditors in the Banking Industry. This research used the survey method through a questionnaire and primary data, which was obtained from the population of heads of division and internal auditor staff in public and private banks operating in Karachi using the Snowball Sampling Technique. The researcher has used Smart PLS for statistical testing. Results of the study have found that among the variables, i.e., The Perceived Benefits do not affect the Attitudes towards Forensic Accounting Services but it directly affects the behavioral intention, although the Perceived Risk affects the attitude and behavioral intention of the auditors. Additionally, the study also finds that the other factors Government Pressure, Internal Control Systems, Stakeholder Pressure, and Time budget Pressure affect the attitude of auditors towards FAS as well as make the direct relationship with the behavioral Intention to use Forensic Accounting Services. This research, conducted within the banking sector of Pakistan, offers several practical implications for managers and policymakers aiming to enhance the adoption and effective use of forensic accounting services, understanding the dynamics between attitudes towards forensic accounting services and behavioral intentions to use these services.

Characteristics and Skills of Forensic Accountants for Effective Financial Fraud Control in Nigeria

The study examined forensic accountants’ relevant characteristics and financial fraud control and investigated the extent to which traits, characteristics, core skills, and enhanced skills of forensic accountants are effective in fraud control. The study adopted the survey method and placed emphasis on the public and private sectors in Delta and Edo states in the south-south of Nigeria, where potential forensic accountants, academics, and users of forensic accounting services were considered respondents through a well-structured questionnaire. A total of 250 copies of the questionnaire were distributed to these respondents, while 214 copies were successfully retrieved. The successfully retrieved questionnaire was also subjected to a pre-test using Cronbach-Alpha test. The collected data were tested and analyzed using ordinary least squares (OLS) regression, correlation matrix, descriptive statistics, and tables. Based on the outcome of the test and analysis, the traits, core, and enhanced skills of forensic accountants have a significant positive effect on financial fraud control. These traits and core and enhanced skills include analytical proficiency, detail orientation, deductive analysis, strategic thinking, analyzing and interpreting financial statement information, interviewing skills. We recommended among others, that the government approve the practice of forensic accounting in Nigeria to aid government agencies in fighting fraud.

Forensic Accounting Services as a tool for Fraud Mitigation in Selected Kwara State owned Tertiary Institutions in Nigeria

This study examined the impact of forensic accounting services on fraud mitigation in selected tertiary institutions in Kwara State. Specific objectives examined the impact of investigation service and digital forensic service on fraud. The study adopted survey research design. The population for the study comprised of principal officers, bursary, account/audit staff of the six selected tertiary institutions in Kwara State. Stratified Random Sampling was used comprising of 157 staff of the selected institutions. Data were collected using a structured questionnaire. Data collected were analyzed using Partial Least Square and Structural Equation Model (PLS-SEM). With a path coefficient of 0.592and 0747 respectively, findings revealed that investigation service and digital forensic service of forensic accountants have a statistically significant negative impact on fraud. It was concluded that forensic accounting services have a significant impact on fraud in tertiary institutions in Kwara State. The study recommended amongst others that tertiary institutions should adopt a comprehensive anti-fraud strategy that combines fraud prevention, detection and prompt response measures. It was also recommended that tertiary institutions should engage the services of forensic accountants at the early stage of a suspected fraud case. Keywords: Forensic Accounting, Fraud, Fraud Mitigation, Investigation Services, Digital Forensic Services, Kwara State, Tertiary Institutions, Corruption.

The Impact of Professionalism Theory Constructs on the Applicability of Forensic Accounting Services: Evidence from Jordan

This study aims to provide an understanding of the impact of professionalism theory constructs on the applicability of forensic accounting services, as well as reviewing the obstacles to implementing the profession of forensic accounting through a literature review. The accounting side of the study explores the profession of forensic accounting and the sociological side of the study will focus on professionalism theory, more specifically Pavalko’s 1988 model. A quantitative method was used in this study; 154 questionnaires from Certified Public Accountants (CPAs) were validated and used in the data analysis. Data analysis was conducted using SmartPLS, which was used for testing the study’s hypotheses. The results demonstrated that the professionalism theory constructs have a significant impact on the applicability of forensic accounting services. There was an indication that six out of eight constructs had a positive impact, which are, code of ethics, commitment, intellectual technique, motivation, training, and relevance to social values, leaving only autonomy and sense of community with no impact shown. This study recommends that forensic accountants and practitioners contribute to developing the profession of forensic accounting and to provide services with high quality. The study’s significant constructs can inform the development of training programs for aspiring forensic accountants in Jordan, emphasizing ethics, commitment, technical expertise, motivation, training, and social values. These findings may also apply to other countries.

A study and analysis on the role of legal accounting in fraud detection and prevention

Forensic accountants are CPAs that look for evidence of crimes and commonly work for insurance companies, financial institutions, and law enforcement agencies. Forensic accountants analyze financial records and accounts that may be used as legal evidence and often testify in court cases as expert witnesses. Forensic accounting is a specialized area of accounting and a challenging one. A forensic accountant investigates incidents of fraud, bribery, money laundering and embezzlement by analyzing financial records and transactions, tracing assets, and more. This study on forensic accounting services and fraud prevention was empirically investigated. The study is vital as it portrays the extent to which the application of forensic accounting services influence the incidence of fraud in health care firms in Nigeria. Two hypotheses were formulated to guide the investigation and the statistical test of parameter estimates was conducted using Kendall’s Coefficient of Concordance. The study anchored on the White Collar Crime Theory adopted a Survey Design Approach. Hence, data were collected using questionnaire survey administered to the relevant accounting sections of health care firms in Nigeria. The empirical analysis of the study indicates that the application of forensic accounting service has reduced the incidence of frauds and has also led to fraud prevention at 1% significant level. Thus, the study concludes that the application of forensic accounting services prevents fraud in health care firms in Nigeria. In lieu of this, the study recommended that adequate internal control system should also be established to have checks and balances among the staff to reduce fraud to its nearest minimum, thereby, restoring confidence to potential and prospective investors. Also, since staff of health care firms in Nigeria are strategic in prevention of fraud, their remunerations and welfare should be made a priority and taken serious. Also, training and re-training of these staff would encourage them to detect early warning signals for fraud activities in the company.

The double-edged sword of forensic accounting services: litigation risks in Jordan’s industrial sector

Purpose This study aims to examine the association between forensic accounting services (FAS) and the risk of litigation within the context of industrial firms that are publicly traded on the Amman Stock Exchange by using the resource-based theory. Design/methodology/approach This study uses a data set consisting of 250 firm-year observations from 2017 to 2021, obtained from the annual reports of 50 selected firms. Logistic regression techniques are used to examine the specifics of the investigated relationship. Findings The findings strongly suggest that companies that use FAS are more likely to face increased litigation risks. This observation suggests that these firms are subject to a more thorough level of evaluation or scrutiny, which inherently increases their vulnerability to potential risks. The study incorporated several control variables such as firm age, size, profitability and working capital. However, it is noteworthy that the connection between FAS and litigation risk emerged as particularly prominent. Research limitations/implications Findings highlight the need for practitioners to tread cautiously with FAS. Although they provide in-depth evaluations, they can also unveil vulnerabilities, leading to increased legal action. Companies should balance the depth of FAS scrutiny against potential legal repercussions, ensuring they harness its benefits without inadvertently raising legal risks. Originality/value While most studies have emphasized the impact of forensic accounting on fraud, this paper covers a gap in the literature regarding the impact of FAS on litigation risks. The paper also facilitates the understanding of the correlation between firm characteristics and the likelihood of litigation.

Forensic Accounting Services and its Effect on Fraud Prevention in Manufacturing Firms in Anambra State

This study on forensic accounting services and its effect on fraud prevention was empirically investigated. Two hypotheses were formulated to guide the investigation and the statistical test of parameter estimates was conducted using Kendall’s Coefficient of Concordance. The data for the study were collected using questionnaire survey administered to the relevant accounting sections of the selected manufacturing firms in Anambra state. The statistical analysis of the study indicates that the application of forensic accounting service has reduced the incidence of frauds and has also led to fraud prevention at 1% significant level. Thus, the study concludes that the application of forensic accounting services has led to fraud prevention in manufacturing firms in Anambra state. The study therefore recommends that manufacturing firms in Anambra state should intensify the application of sophisticated forensic auditing in the fight against fraud and forgeries in the system as the probability of fraud detection and prevention will be generally low especially in this era of technological revolution.

Influence of Forensic Accounting Services on Fraud Reduction in Nigerian Public Sector Organization

This study on forensic accounting services and fraud prevention in the Nigerian public sector was empirically investigated. The study is vital as it portrays the extent to which the application of forensic accounting services reduces the incidence of fraud in the government sector of Nigeria. Three hypotheses were formulated to guide the investigation and the statistical test of parameter estimates was conducted using Kendall’s Coefficient of Concordance. The study anchored on the White Collar Crime Theory adopted a Survey Design Approach. Hence, data were collected using questionnaire survey administered to the relevant accounting sections of federal government ministries, departments, agencies and parastatals in Awka metropolis. The empirical analysis of the study indicates that the application of forensic accounting service has reduced the incidence of frauds and has also led to fraud prevention at 1% significant level. Thus, the study concludes that the application of forensic accounting services prevents fraud in the in Nigerian public sector organizations. In lieu of this, the study recommended that government should establish a Public Recovery Fund (PRF), where funds collected through forensic accounting should be held and properly used to improve the performance of Nigerian public sector. Also, forensic accounting services are recommended in the Nigerian public sector as it brings fraud and other fraudulent practices to its lowest level.

Exploring the Current State of Forensic Accounting in Saudi Arabia and Possible Ways of Elevating It to Assist the Government Fighting Corruption

Abstract Corruption occurs when there is a misuse of current resources to maximize personal benefits at the expense of other parties, causing financial problems and preventing the development of emerging economies. Forensic accounting services utilize financial data to solve legal disputes. Saudi Arabia’s government does not tolerate obstacles that impede the realization of its ambitious Vision 2030, a long-term plan for transforming society and reforming the economy. The war on corruption has been observed in Saudi Arabian domestic policy. Whether the forensic accounting profession and the readiness of accountants qualified to conduct forensic inquiries and investigations are effectively accompanied by the government’s fight is probed. This study explores the current state of forensic accounting in Saudi Arabia. Potential means of employing such status to make Saudi Vision 2030 a reality to combat corruption and the ability of forensic accounting to ease the government’s fight are also investigated. A questionnaire was conducted on 181 participants comprising accountants, auditors, judges, accountancy academics, Oversight and Anti-Corruption Authority employees, and any supervisory body in Saudi Arabia. The results show that 46% of the surveyed participants were unaware of forensic accounting, implying that despite its significance and demand for its services, forensic accounting is undersupplied in Saudi Arabia. Thus, it is inferred that the current state of forensic accounting is below the required level. To address this issue, forensic accounting should be incorporated into accounting curricula, accountants should join specialized scholarship programs and seek to be certified forensic accountants. Policy-makers must develop charter institutions and related forensic accounting standards.

Perceived Ethical Climate and Forensic Accounting Services: Evidence From the Nigerian Public Sector

It has been maintained that no matter the level of professional forensic accountants’ expertise, they would not achieve the goals of detecting and preventing fraud without the necessary supportive ethical climate. Therefore, this study investigated the effect of perceived ethical climate and the use of forensic accounting services for the detection and prevention of fraud in the Nigerian public sector. The study used data collected from the responses of 133 senior staff in the finance and accounts department of the six-area council in Abuja. The method of data analysis technique adopted for this study is multiple regression analysis with the aid of Statistical Package for Social Sciences (SPSS). The study found that perceived ethical climate (principle ethical climate and benevolence ethical climate) has a positive and significant effect on the application of forensic accounting services in the selected public sectors of Nigeria. The study concluded that one of the key elements influencing the use of forensic accounting services in the public sector is the perceived ethical climate. This study recommends that professional accountants should eschew the temptation to mislead and manipulate financial information, even while inaccuracies or differences of opinion regarding the applicability of forensic accounting services laws do exist.

Integration of forensic accounting with corporate governance: A weapon to combat financial frauds

The ever-increasing numbers of myriad frauds and scams, and the failure to detect and prevent fraud, have increased the demand for forensic accounting services at an incredible rate. Keeping the above in view, this paper has focused on the role of forensic accounting in ensuring good corporate governance (CG) and tried to find out whether integration of forensic accounting with corporate governance is helpful in fraud prevention and detection. The study was theoretical research. Previous literature and reports were analysed to reach a conclusion in the study. From the studies conducted this paper concluded that the integration of forensic accounting with CG will help the organization to formulate a clear and optimal CG policy, maintain transparency by disclosing all material facts and establish an effective and efficient internal control system .

Forensic Accounting Impact on Fraud Detection in Saudi Arabia

The primary subject matter of this research is to examines the effect of forensic accounting on fraud detection in Saudi Arabia. The aim of this study is to determine the relationship between fraud detection and forensic accounting in the context of a developing country, Saudi Arabia. Descriptive Statistics are used to present quantitative descriptions in a manageable form. The collected data were analyzed with descriptive statistics using ordinary least square (OLS) regression and Chi-square. The study reveals that the application of forensic accounting services on firms affects the level of fraudulent activities. This paper findings conclude that forensic accounting services provide Saudi Arabian companies with the necessary tools to deter fraudulent activities but does not curb fraudulent activities. Keywords: Forensic Accounting; Financial Fraud, Anti-fraud detection; falsification of accounts; and Saudi Arabia. DOI: 10.7176/RJFA/13-20-02 Publication date: October 31 st 2022

Cash Theft Investigation and Evidence Documentation

ABSTRACTIn Case Task 1, students will act as forensic accounting services professionals (AICPA 2019, SSFS No. 1; IIA, AICPA, and ACFE 2008; NIJ 2007), using data analytics (AICPA 2017) to investigate possible thefts of cash. In Case Task 2, students will act as internal auditing services professionals (IIA 2017), using attribute estimation sampling to evaluate the effectiveness of internal controls in responding to the fraud risk regarding the alleged thefts of cash (IIA 2019a, Standards 2130.A1; COSO 2016). The case meets three primary Case Learning Objectives: (1) improve students' “click and play” learning experience about cash theft investigation and evidence documentation (AACSB 2018, Standard A5), (2) increase students' higher-order cognitive skills in deductive reasoning and inference about evidence (AICPA 2016, Exhibit 1), and (3) teach students to document workpapers professionally, clearly, and concisely. The implementation guide suggests ways to create multiple versions of the case and includes two case extensions.

Factors Influencing Forensic Accounting services Awareness In Iraqi environment

Forensic accounting considered as modern tools to address fraud and corruption crimes in countries that suffering from this phenomena. There are many services that Forensic Accounting provided. In Iraq there is low level of awareness related to Forensic accounting services. This study was a theoretical attempt to declare the factors that influence on Forensic Accounting Services Awareness (FASA). Current study found that there five factors which they are: Professional bodies, Accounting firms, Multimedia, Government, Education, these factors affected on FASA and they are suitable for the Iraqi environment.

Mediation effect of collapse avoidance assurance on behavioural intention to use forensic accounting

Forensic Accounting is a widely known technique for fraud prevention and detection. To date, the demand for forensic accounting is increasing, as well as the fraud level. However, some companies are reluctant to use forensic accounting to find guilty and face legal consequences such as liquidation or winding up. The two main theories of this study are the Protection Motivation Theory (PMT) and Forensic Accounting Theory. The two theories incorporate fraud treat appraisal and collapse avoidance assurance in forensic accounting to determine the behavioural intention to use forensic accounting. This study is expected to generate the best model to address the unwillingness to adopt forensic accounting services by industrial products and services companies. Therefore, this study may significantly contribute to the increase in companies' awareness and willingness to use forensic accounting in mitigating fraud or unethical activities.

Mediation effect of collapse avoidance assurance on behavioural intention to use forensic accounting

Forensic Accounting is a widely known technique for fraud prevention and detection. To date, the demand for forensic accounting is increasing, as well as the fraud level. However, some companies are reluctant to use forensic accounting to find guilty and face legal consequences such as liquidation or winding up. The two main theories of this study are the Protection Motivation Theory (PMT) and Forensic Accounting Theory. The two theories incorporate fraud treat appraisal and collapse avoidance assurance in forensic accounting to determine the behavioural intention to use forensic accounting. This study is expected to generate the best model to address the unwillingness to adopt forensic accounting services by industrial products and services companies. Therefore, this study may significantly contribute to the increase in companies' awareness and willingness to use forensic accounting in mitigating fraud or unethical activities.

Private Investigations and Self-Disclosure of Suspected Fraud: Experimental Evidence on Forensic Accounting Services

ABSTRACT When a company internally suspects material fraud, it faces difficult choices. It can choose to investigate internally or engage an external specialist. Additionally, it can choose to disclose the investigation or take the risk that the investigation is leaked to the public. I analyze whether the choice to engage an external specialist, rather than investigate internally, changes investors' willingness to invest in the company. I argue that, when engaging external specialists, disclosure choices matter. Conceptualizing the engagement of external specialists as an external credibility signal, I hypothesize that, when engaging external specialists, self-disclosure increases investors' willingness to invest compared to when the press reveals the investigation. Results from a 2 × 2 between-subjects experiment with 128 non-professional investors support my hypothesis. This suggests that aligning a signal of credible investigation efforts with forthcoming disclosure could be beneficial. Hence, companies conducting genuine investigations could benefit from resisting temptation of nondisclosure.

The Intention to Use Forensic Accounting as a Fraud Mitigation Tool: Mediating Effect of Collapse Avoidance Perspective

Forensic Accounting is widely known as a fraud mitigation tool. The demand for forensic accounting is increasing, along with the fraud level. However, some companies are reluctant to use forensic accounting due to fear be found guilty and have to face legal consequences. The two main theories of this study are the Protection Motivation Theory (PMT) and Forensic Accounting Theory. The two theories are incorporating the element of fraud treat appraisal and collapse avoidance perspective in forensic accounting to determine the intention of companies to use forensic accounting. This study is expected to address the unwillingness to adopt forensic accounting services through the proposed framework model. Therefore, this study may significantly contribute to the increase of awareness and willingness of companies to use forensic accounting for fraud mitigation.

The role of Forensic accounting in combating money laundering - a field study on the Kingdom of Saudi Arabia - in light of its accession to Financial Action Task Force (FATF): دور المحاسبة القضائية في مكافحة غسيل الأموال - دراسة ميدانية على المملكة العربية السعودية- في ظل انضمامها لمنظمة العمل المالي (فاتف)

This research aimed to clarify the role of Forensic accounting in the development of accounting work mechanisms to combat money laundering operations, and how to benefit from the Kingdom of Saudi Arabia joining Financial Action Task Force (FATF) in that, the researchers relied on carrying out this research on the descriptive analytical approach and relied on the statistical packages for science program Statistical Package For Social Science (SPSS / Pc +) in hypothesis testing, sample analysis, data compilation, tabulation and analysis. The research found that there is a direct relationship between Forensic accounting services and its components and the accession of Saudi Arabia to Financial Action Task Force (FATF) and combating money laundering operations The research recommended to increase the activation of Forensic accounting programs in the Saudi Organization for Certified Public Accountants as well as business colleges of King Khalid University to contribute to the elimination of money laundering operations in line with the Kingdom's current status as a permanent member of Financial Action Task Force (FATF).

Corruption and fraud detection through foresic accounting practices in kurdistan region of iraq

This paper aims to explore the importance and the role of forensic accounting practices in detecting (and preventing) corruption and fraud; and to identify the factors that hinder the adoption of forensic accounting practices in Kurdistan Region, Iraq. To achieve the objectives of the study was developed questionnaire included (24 questions) distributed on 47 academic professionals in the Kurdistan Region Iraq, the researchers reached a number of conclusions after analyzing questionnaire's questions. The most important of these conclusions There is a role Forensic Accounting in combating fraud and financial corruption in the Kurdistan Region and there are many factors that hinder the application of Forensic Accounting in the Kurdistan Region. The researchers also made a number of recommendations, in view of the importance of Forensic Accounting, therefore, researchers recommend increasing interest in it in the school curriculum and incorporating this aspect in accounting education so that the graduate to be familiar with it and the necessity for the Kurdistan Regional Government to build an effective monitoring system based on Forensic Accounting services that takes it upon itself to preserve both the rights and the financial authority.