Factors Affecting Fraudulent Statement in Forensic Accounting Perspective

Abstract

Nowadays the awareness of loss from fraud has been shifted from blue collared employee theft to white collared management fraudulent statement. Forensic accounting becomes one of the solutions to detect this fraudulent statement. On the basic of our premise, the purpose of research to explore empirical evidence regarding financial statement fraud detection factors with net worth method as control variable. Our independent variables were debt to equity ratio, change in net assets, and return on asset. The research was quantitatively on food and beverage manufacturing companies listed on the Indonesia Stock Exchange. We use financial statement year end audited from 2013-2017. We used purposive sample, when selecting the samples. Total of 55 company reports samples were used in this research. We analyzed the data using statistical multiple linear regression analysis. We used statistical software to do the regression, in order to answer the research questions and test the hypothesis. Fraudulent reporting fraud was examined using proxies Beneish M-score. After the statistical test, this research concludes that financial distress factor proxy Debt to Equity Ratio (DER) has no significant effect on fraud detection. Other factor that is financial stability was proxies by changes in total assets (ACHANGE), and financial targets in the proxy of Return on Assets (ROA) both have significant impact on the detection of financial statement fraud.

Forensic Audit and Mitigation of Financial Crimes in Nigeria

“…These findings are in agreement with Okoye et al (2020); their results suggested that there are no universally accepted forensic investigation techniques for the detection of public sector fraud and a positive and significant association between forensic accounting techniques and public sector fraud detection. The study's findings also agreed with Akenbor and Ironkwe (2014), Uniamikogbo et al (2019), Dada and Jimoh (2020), Handoko et al (2019). Their results revealed that proactive and reactive forensic auditing techniques have a negative and significant association with fraudulent practices in public institutions in Nigeria.…”