FRAUD DIAMOND FOR DETECTION OF FINANCIAL STATEMENT MISREPRESENTATION IN THE MANUFACTURING INDUSTRY
This research was conducted to obtain empirical evidence regarding fraud, primarily due to fraud in financial reports based on the fraud diamond theory. This study tested six independent variables; financial stability, external pressure, financial targets, effective monitoring, rationalization, and...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Widya Mandala Surabaya Catholic University,Faculty of Business
2022-12-01
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| Series: | Research in Management and Accounting |
| Subjects: | |
| Online Access: | http://jurnal.wima.ac.id/index.php/RIMA/article/view/4005 |
| _version_ | 1797776590264860672 |
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| author | Rizqi Ayu Mentari Sopian |
| author_facet | Rizqi Ayu Mentari Sopian |
| author_sort | Rizqi Ayu Mentari |
| collection | DOAJ |
| description | This research was conducted to obtain empirical evidence regarding fraud, primarily due to fraud in financial reports based on the fraud diamond theory. This study tested six independent variables; financial stability, external pressure, financial targets, effective monitoring, rationalization, and capability. P-Score Model is used to detect potential fraudulent financial statements. The objects studied were 103 manufacturing companies listed on the Indonesia Stock Exchange (IDX) in 2015-2019 with 515 annual reports. The results of this study indicate that only two variables have an effect in detecting fraud in financial statements. The variables that have a significant effect are financial stability as proxied by the ratio of changes in assets and financial targets as proxied by the ratio of return on assets (ROA). Other variables represented by external pressure, effective monitoring, rationalization, and capability did not affect the detection of potential fraudulent financial statements. These findings may benefit auditors in predicting fraud in financial statements, considering the fraud diamond environment. |
| first_indexed | 2024-03-12T22:52:01Z |
| format | Article |
| id | doaj.art-63d142fae96c40e590e7d4783d7e3215 |
| institution | Directory Open Access Journal |
| issn | 2723-3804 |
| language | English |
| last_indexed | 2024-03-12T22:52:01Z |
| publishDate | 2022-12-01 |
| publisher | Widya Mandala Surabaya Catholic University,Faculty of Business |
| record_format | Article |
| series | Research in Management and Accounting |
| spelling | doaj.art-63d142fae96c40e590e7d4783d7e32152023-07-20T07:35:07ZengWidya Mandala Surabaya Catholic University,Faculty of BusinessResearch in Management and Accounting2723-38042022-12-01526892https://doi.org/10.33508/rima.v5i2.4005FRAUD DIAMOND FOR DETECTION OF FINANCIAL STATEMENT MISREPRESENTATION IN THE MANUFACTURING INDUSTRYRizqi Ayu Mentari0Sopian1PKN STANPKN STANThis research was conducted to obtain empirical evidence regarding fraud, primarily due to fraud in financial reports based on the fraud diamond theory. This study tested six independent variables; financial stability, external pressure, financial targets, effective monitoring, rationalization, and capability. P-Score Model is used to detect potential fraudulent financial statements. The objects studied were 103 manufacturing companies listed on the Indonesia Stock Exchange (IDX) in 2015-2019 with 515 annual reports. The results of this study indicate that only two variables have an effect in detecting fraud in financial statements. The variables that have a significant effect are financial stability as proxied by the ratio of changes in assets and financial targets as proxied by the ratio of return on assets (ROA). Other variables represented by external pressure, effective monitoring, rationalization, and capability did not affect the detection of potential fraudulent financial statements. These findings may benefit auditors in predicting fraud in financial statements, considering the fraud diamond environment.http://jurnal.wima.ac.id/index.php/RIMA/article/view/4005fraud diamondfinancial statement misrepresentationp score model |
| spellingShingle | Rizqi Ayu Mentari Sopian FRAUD DIAMOND FOR DETECTION OF FINANCIAL STATEMENT MISREPRESENTATION IN THE MANUFACTURING INDUSTRY Research in Management and Accounting fraud diamond financial statement misrepresentation p score model |
| title | FRAUD DIAMOND FOR DETECTION OF FINANCIAL STATEMENT MISREPRESENTATION IN THE MANUFACTURING INDUSTRY |
| title_full | FRAUD DIAMOND FOR DETECTION OF FINANCIAL STATEMENT MISREPRESENTATION IN THE MANUFACTURING INDUSTRY |
| title_fullStr | FRAUD DIAMOND FOR DETECTION OF FINANCIAL STATEMENT MISREPRESENTATION IN THE MANUFACTURING INDUSTRY |
| title_full_unstemmed | FRAUD DIAMOND FOR DETECTION OF FINANCIAL STATEMENT MISREPRESENTATION IN THE MANUFACTURING INDUSTRY |
| title_short | FRAUD DIAMOND FOR DETECTION OF FINANCIAL STATEMENT MISREPRESENTATION IN THE MANUFACTURING INDUSTRY |
| title_sort | fraud diamond for detection of financial statement misrepresentation in the manufacturing industry |
| topic | fraud diamond financial statement misrepresentation p score model |
| url | http://jurnal.wima.ac.id/index.php/RIMA/article/view/4005 |
| work_keys_str_mv | AT rizqiayumentari frauddiamondfordetectionoffinancialstatementmisrepresentationinthemanufacturingindustry AT sopian frauddiamondfordetectionoffinancialstatementmisrepresentationinthemanufacturingindustry |