Statement Fraud Research Articles

PENDETEKSIAN FINANCIAL STATEMENT FRAUD MENGGUNAKAN FRAUD HEXAGON PADA PERUSAHAAN YANG TERINDEKS IDXBUMN20

This research has a problem with financial statement fraud with the smallest percentage of cases but has the greatest impact on state losses among other frauds. This study aims to detect financial statement fraud using fraud hexagon in IDXBUMN20 indexed companies. There are six dimensions in the fraud hexagon consisting of stimulus, ability (Capability), conspiracy (Collusion), opportunity (Opportunity), rationalisation, and (arrogance). This study measures financial statement fraud using the Beneish M-Score. The population of this study were 20 BUMN companies indexed on IDXBUMN20. To select the sample, purposive sampling method was used for 15 state-owned companies for 3 years of observation with 45 observations. Logistic regression model as an analysis technique. Data processing with SPSS 26 which obtained results showing that financial stability proxy stimulus, auditor turnover proxy opportunity and ineffective supervision proxy rationalization affect financial statement fraud. While the change of directors proxy capability, the number of independent commissioners who hold concurrent positions proxy collusion, and the number of CEO photos in the annual report proxy arrogance have no effect on financial statement fraud.

Financial Statement Fraud Risk and Financial Distress of Family Business: Socio-Emotional Wealth (SEW) Perspective

Financial Statement Fraud Risk and Financial Distress of Family Business: Socio-Emotional Wealth (SEW) Perspective

Investigating the Link among Corruption, Corporate Governance and Corporate Performance in Family Businesses: A Future Research Agenda

Family businesses have distinct characteristics that differentiate them from other firms. Researchers must meticulously analyze issues, with a specific focus on the interplay of family business dynamics, considering this factor. The main objective of this research was to provide insight into the adverse effects of family companies, particularly how the power dynamics inside these organizations might enable corruption or fraud and how corporate governance can help in mitigating these phenomena. Specifically, family businesses can be investigated by considering unique characteristics such as ownership and control, generational dynamics, and corporate governance. To address the study topic, a bibliometric analysis was conducted using the R statistical programming language and the bibliometric tools Biblioshiny and VOSviewer. Data were obtained from the Scopus database and examined in documents. The lack of unbiased external evaluation, the ineffectiveness of internal audits, disputes between different generations, the dominance of family members, and the narrow extent of governance all contribute to the exacerbation of tensions that promote corruption inside family firms. Moreover, the findings indicate that CEO duality correlates with the occurrence of corruption and fraudulent activities, such as manipulating profits. Furthermore, the findings suggest a correlation between the qualities of the board and instances of corruption and bribery inside family firms. These factors also increase the probability of financial statement fraud.

PERAN AUDIT COMMITTEE SEBAGAI PEMODERASI FAKTOR-FAKTOR YANG MEMENGARUHI FRAUDULENT FINANCIAL STATEMENT

This study aims to provide empirical evidence about the influence of external pressure, changes in auditors, nature of industry, changes in directors, political connections of fraudulent financial statements through the audit committee as a moderating variabel. The second objective is to identify the influence of CEO education and effective monitoring on fraudulent financial statements. The population used in this study are companies listed on the Indonesia Stock Exchange (IDX) in 2020-2022. The research sample was obtained through the purposive sampling method where there were 402 data that had been collected as samples. The data were analyzed using multiple regression methods to test the entire hypothesis. The results of this research indicate that external pressure has a negative impact on fraudulent financial statements. Therefore, the more significant the amount of debt obtained by a company, the more intensive the supervision conducted by creditors on the credit history of the company, and fraudulent activities can be detrimental to the company. The nature of the industry and effective monitoring have a positive impact on fraudulent financial statements. The audit committee strengthens the relationship between external pressure and fraudulent financial statements, while weakening the relationship between the nature of the industry and fraudulent financial statements. Moreover, changes in auditors, changes in directors, political connections, CEO education, changes in auditors moderated by the audit committee, changes in directors moderated by the audit committee, and political connections moderated by the audit committee have no significant influence on fraudulent financial statements.

Audit and Board Committee Expertise and Financial Statement Fraud among Listed Oil and Gas Firms in Nigeria

Financial statement fraud is the intentional falsification of financial information in order to defraud investors, creditor or other stakeholders. This study focused on the influence of audit and board committee expertise on financial statement fraud among Oil and Gas firms in Nigeria. The sample consist of seven (7) oil and gas companies listed on the Nigerian stock exchange group (NGX) over a period of 2013-2022, the study used panel regression. Financial statement fraud used as Dependent Variable is measured using the Beneish M-score model, while the independent variable was audit Committee Expertise and Board Committee Expertise using Accounting/Financial background. Findings show that an insignificant association exists between audit committee expertise, the composition of the board and financial statement fraud. This research suggests that regulatory bodies and industry association persist in their efforts to endorse sound corporate governance practices and addressing the challenging associated with board committee expertise.

Detecting Fraudulent Financial Reporting The Construction Sector In Indonesia: Fraud Triangle

The category of fraud that has the largest number of losses is financial statement fraud. Apart from being financially detrimental to a company, fraudulent financial reports can also threaten the company's sustainability. Examining the influence of financial targets, financial stability, external pressure, industry nature and rationalization on financial report fraud (F-Score) in construction sector companies in Indonesia is the aim of this research. This research is quantitative, with secondary data types. The number of samples used was 83 from the total construction sector companies. The research results show that financial stability has a positive effect, while financial targets, external pressure, nature of industry and rationalization have a negative and insignificant effect on fraudulent financial reporting.

Analysis of Fraud Hexagon Theory on Fraudulent Financial Reporting Based on The Role of Intellectual Capital As A Mediator That is Influenced by Earnings Management Practices

Fraudulent financial reporting is a serious problem faced by companies throughout the world. This fraud can have fatal consequences for the company, such as loss of investor confidence, decline in share value, and even bankruptcy. There are various theories that can be used to analyze financial statement fraud, one of which is the fraud hexagon theory. This research aims to analyze the fraud hexagon theory of fraudulent financial reporting based on the role of intellectual capital as a mediator which is influenced by earnings management practices. In this study, researchers used qualitative methods with data collection techniques through literature studies. The data collected was analyzed through three steps, which included data reduction, data presentation, and making conclusions. The findings in the study show that the Fraud Hexagon theory provides a comprehensive framework for understanding the factors that encourage fraudulent financial reporting by including six key elements: pressure, opportunity, rationalization, competence, arrogance and collusion. In this context, earnings management practices are often the main trigger. The pressure experienced by management to meet financial targets can encourage them to carry out earnings management, which in turn increases the risk of fraudulent financial reporting. Opportunities for fraud often exist due to weaknesses in internal controls, which allow manipulation of financial data without detection.

Analysis of Bankruptcy Risk during the Pandemic on the Tendency of Financial Report Fraud through Profit Manipulation

This research aims to find empirical evidence of the link between bankruptcy risk and the tendency for fraud in financial reports through earnings manipulation during the pandemic. The measurement of the bankruptcy risk variable in this study uses the Z-Score because this model can be used by all types of companies, the earnings manipulation variable is measured using the Conditional Revenue Model because this model is better able to detect earnings management than previous measurement models, and the measurement of financial statement fraud variables in This research uses the F-Score Model because this model has higher sensitivity in detecting fraud. The results of this research found that during the pandemic, the risk of bankruptcy influenced the tendency for fraudulent financial reports through profit manipulation.

The Impact of Fraud on the Detection of Fraud in Financial Statements and Discretionary Accruals (Meta-Analysis Study)

The Impact of Fraud on the Detection of Fraud in Financial Statements and Discretionary Accruals (Meta-Analysis Study)

Influence of Fraud Triangle on Financial Statement Fraud with Financial Distress as an Intervening Variable

Influence of Fraud Triangle on Financial Statement Fraud with Financial Distress as an Intervening Variable

ANALISIS PENGARUH TEKANAN DAN RASIONALISASI TERHADAP KECURANGAN LAPORAN KEUANGAN

This study aims to determine the effect of pressure and rationalization on financial statement fraud in infrastructure sector BUMN companies listed on the Indonesia Stock Exchange for the 2017-2022 period. The population of this study are state-owned infrastructure companies listed on the Indonesia Stock Exchange for the 2017-2022 period. Samples were taken using purposive sampling technique. The sample used in this study were 6 BUMN companies in the infrastructure sector which were listed on the Indonesia Stock Exchange for the 2017-2022 period, so that the research data analyzed totaled 36. Tests in this study used Multiple Linear Regression Analysis with the Eviews program version 12. The results of the study were partial shows that pressure proxied using Return on Assets (ROA) has a positive and insignificant effect on fraudulent financial statements and rationalization proxied using Change in Auditor has a positive and significant effect on fraudulent financial statements. The results of the study simultaneously show that pressure proxied using Return on Assets (ROA) and rationalization proxied using Change in Auditor have no simultaneous effect on fraudulent financial statements.

Financial Statement Fraud Analysis: Financial Stability, External Pressure and Auditing Quality

Financial Statement Fraud Analysis: Financial Stability, External Pressure and Auditing Quality

HOW FRAUD HEXAGON MODEL ON FINANCIAL STATEMENT FRAUD IN ENERGY SECTOR COMPANIES?

Financial statement fraud is a discrepancy between the application of accounting principles and the preparation of financial statements with the aim of deceiving users of financial statements This study aims to analyze the effect of Hexagon Fraud on financial statement fraud. There are 10 variables used, namely financial targets, financial stability, change of directors, monitoring, ideal condition of the company, change of auditor, photo of the CEO, government projects, political connections, managerial ownership. Financial statement fraud is measured using the Beneish M-Score Model. The samples in this study are energy sector companies listed on the Indonesia Stock Exchange (IDX) in 2020-2021 with the number of samples used being 50 companies with 100 units of analysis taken based on the purposive sampling method. Data analysis in this study used panel data regression analysis with the EViews 13 analysis tool. The results of this study show that a company's Financial Target has an influence on the potential for financial statement fraud. Meanwhile, financial stability, change of directors, monitoring, ideal condition of the company, change of auditor, CEO photo, government projects, political connections, managerial ownership have no influence on the potential for financial statement fraud.

Considerations of Religion and Situational Factors, Internal Control on the Occurrency of Fraud Trends: An Experimental Study of the Financial Services Sector in Indonesia

Financial statement fraud does not only occur in the private sector but can also occur in the government sector in the form of material misrepresentation of financial statements to cover up the actual financial condition by carrying out financial engineering. This study aims to examine religious considerations and situational factors, namely pressure or directives from superiors and internal controls against committing fraud tendencies. Literature reveals that religion plays a dominant role in shaping employees' values in their work. This study used an experimental method on 33 financial institution employees divided into two sessions to see the impact of scenarios. The analysis technique using Analysis of Variances (ANOVA) is used to perform multivariable comparative analysis. The results of empirical testing show that internal control factors have a negative influence on fraudulent behavior, and pressure factors or superior directions have a positive effect on the tendency to commit fraud. Meanwhile, religious considerations have less influence on fraud tendencies.

Does the form of state ownership and political connections influence the incidence of financial statement fraud?

Do forms of state ownership and politically connected senior management affect the incidence of financial statement fraud? In this study, we consider these questions and provide new evidence as to the factors influencing fraud commission and detection for Chinese listed firms between 2007 and 2018. Six major types of financial statement fraud activities are identified. Using a bivariate probit model, developed to address partial observability concerns, we report state ownership lowers the likelihood of fraud detection, while increasing a firms’ propensity to commit fraud. In addition, state-owned enterprises (SOEs) controlled by local government are more likely to engage in fraud and escape regulatory punishments, relative to SOEs controlled by central government. The effect of politically connected senior management over fraud commission or regulatory detection is also diluted by the presence of state ownership. Moreover, the role of state ownership in encouraging fraud commissions and escaping from regulatory punishments is more pronounced for the local non-politically connected SOEs.

The Influence of Audit Quality and Auditor Experience on the Auditor's Fraud Assessment Ability

Several companies use various methods to commit fraud in financial reporting in order to get a good performance assessment. The case of alleged manipulation of financial reports that has occurred is the case of PT Envy Technologies Indonesia Tbk. The issuer is suspected of committing fraud after 2 years of being registered as a public company on the IDX since July 9 2019. This study aims to determine the effect of audit quality and auditor experience in detecting fraud that occurs (fraud). The study employs quantitative methods with the assistance of SPSS IBM 20. The population consists of auditors working at Public Accounting Firms in the Jakarta and Bekasi regions, selected using a purposive sampling method based on specific criteria. Data collected by using questionnaire sharing by google form and immediately sharing. Based on the highest variable indicators, a total of 145 auditors were selected as respondents. The study's findings indicate that the audit quality variable has a significantly positive impact on the ability to detect fraud. This is attributed to the fact that higher auditor competence leads to faster and more accurate fraud detection. Additionally, the auditor's experience variable also positively and significantly influences the ability to detect fraud, suggesting that the longer an auditor's work experience with diverse levels of workload complexity, the better their capability to identify fraud in financial statements.

Evaluating the impact of hexagon fraud on potential financial statement fraud with audit quality as a moderator

Evaluating the impact of hexagon fraud on potential financial statement fraud with audit quality as a moderator

Corporate Governance as a Detector of Financial Statement Fraud: Systematic Literature Review

Financial reporting fraud occurs when someone misunderstands the financial condition of a company deliberately or not. One of the causes of financial statement fraud is poor governance. This study aims to describe the development of corporate governance research as a detector of financial statement fraud. The method used in this study is Systematic Literature Review. Publish or Perish (PoP) software is used to search for articles. Based on the synthesis results, there are five corporate governance structure mechanisms that can detect financial statement fraud: auditor, board of directors, internal control, shareholders, and performance. The synthesis results show that each corporate governance structure mechanism has not been able to work together to detect financial statement fraud. Therefore, there is a need for cooperation to minimize financial statement fraud. Future research is expected to use more data to increase understanding of how companies detect financial statement fraud by accessing e-resources such as Elsevier, Springer, Emerald Insight, and Wiley. Meanwhile, Scimago can be used to assess the quality and ranking of journals.

Hubungan Fraud Terhadap Financial Statement di Indonesia (Studi Empiris pada Perusahaan Sektor Energi yang Terdaftar di Bursa Efek Indonesia Tahun 2018-2022)

This study uses a quantitative approach that aims to examine and analyze the relationship between fraud and financial statements by using the fraud diamond theory as measured by fraud scores in energy sector companies. The data used in this study comes from secondary data, which is obtained by accessing financial reports on the IDX website. Data analysis techniques are applied to the logistic regression analysis by operating SPSS 26 software. The findings of this study indicate that the nature of industry has an effect on financial statement fraud. However, personal financial need, auditor firm size, and change of auditor have no effect on financial statement fraud.

Identification of fraudulent financial statements through a multi‐label classification approach

SummaryAlthough the financial audit controls in companies have advanced over the years, the number of corporate fraud instances is growing, thus raising the need for investigating the factors that can be used as early warning signals and developing effective systems for identifying financial fraud. In this paper, financial statements from 133 Greek companies listed in the Athens Stock Exchange over the period 2014 to 2019 are investigated, based on the fraud diamond theory. Financial data and corporate governance variables are used as inputs to data mining techniques to develop models that can identify patterns of irregularities in a company's financial reports. To this end, popular machine learning classification algorithms are employed in a novel multi‐label classification setting that not only identifies fraudulent cases but also considers the nature of the auditors' comments. The results indicate that the proposed multi‐label approach provides enhanced results compared to binary classification algorithms, avoiding inconsistent outputs with respect to the existence of different forms of manipulation of financial statements.