Financial reporting misconduct: Evidence from the field

Amar, Moty; Chen, Ester; Gavious, Ilanit; Weihs, Hagit

doi:10.1016/j.frl.2021.102540

Cited by 5 publications

(4 citation statements)

References 24 publications

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“…Management motive has a considerable favorable impact on financial statement fraud through earnings management. The findings of this study are in accordance with the findings of Amar et al (2021). This happens because changes in the public accounting firm by the company can result in a transition period.…”

Section: Analysis Model and Hypothesis Testsupporting

confidence: 91%

“…Liu and Liu (2008) found that companies that reported profits/losses in the year the auditor changed would improve earnings management. Amar et al (2021) discovered that earnings management could mediate the influence of management motive on financial statement fraud. Managers will engage in earnings management due to the pressure to reach financial performance targets, which will eventually lead to financial statement fraud due to the slippery slope of earnings management (Amar et al, 2021).…”

Section: The Impact Of Management Motive On Financial Statement Fraud...mentioning

confidence: 99%

“…Amar et al (2021) discovered that earnings management could mediate the influence of management motive on financial statement fraud. Managers will engage in earnings management due to the pressure to reach financial performance targets, which will eventually lead to financial statement fraud due to the slippery slope of earnings management (Amar et al, 2021). As a result, researchers are proposing the following hypothesis:…”

Section: The Impact Of Management Motive On Financial Statement Fraud...mentioning

confidence: 99%

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Independence, Management Motives and Financial Statement Fraud: Role of Earnings Management

Wati

2022

IJAR

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This study aimed to examine the direct impact of auditor independence and management motivation on financial statement fraud, with earnings management acting as a moderator. This study relies on data from 146 manufacturing companies registered on the Indonesia Stock Exchange for 2013-2018 with 786 observational data. This study's data were analyzed using partial least squares. The outcomes showed that auditor independence and management motivation (financial target and rationalization) positively impact financial statement fraud and earning management. Earnings management can help to mediate the effect of auditor independence and management motivation (financial target and rationalization) with partial mediation. Our research provides new empirical evidence in providing information about factors that impact financial statement fraud which is beneficial for companies and stakeholders, as well as assessing activities carried out by organizations or companies. Company management can prevent and detect fraud or manipulation of financial statements early, find out the factors that allow fraud to occur, and control areas that may give rise to fraud. This research can be a reference in making various policies regarding the practice of financial statement fraud in an entity.

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Section: Analysis Model and Hypothesis Testsupporting

confidence: 91%

Section: The Impact Of Management Motive On Financial Statement Fraud...mentioning

confidence: 99%

Section: The Impact Of Management Motive On Financial Statement Fraud...mentioning

confidence: 99%

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Independence, Management Motives and Financial Statement Fraud: Role of Earnings Management

Wati

2022

IJAR

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“…Therefore, the effectiveness of the internal audit function has effect on the quality of financial reporting. Based on respondents' answers, the effectiveness of internal audit functions were in the excellent category, and the effectiveness of internal audit functions are demonstrated through audit quality, professional capabilities of internal auditors and through organizational settings (Amar, Chen, Gavious, & Weihs, 2021;Hansen, 2010). These data show that the internal audit function of SOEs in Indonesia is very effective.…”

Section: Hypothesis Testing Resultsmentioning

confidence: 82%

Risk Management and other Factors Preventing Fraudulent Financial Reporting by State-Owned Enterprises in Indonesia

Novatiani

Afiah

Sumantri

2022

5002

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This study aims to provide an overview of the effects of risk management and the implementation of good corporate governance (GCG), and the effectiveness of the internal audit function on the prevention of fraudulent financial reporting and its impact on the quality of financial reporting of state-owned enterprises (SOEs) in Indonesia. Questionnaires are used to determine risk management and other factors that influence each other and their impact on the quality of financial reporting. The questionnaire and survey results of 90 state-owned enterprises (BUMN) and 360 respondents. SEM-PLS was used to analyze the data, and the results show that the implementation of GCG, the effectiveness of the internal audit function and risk management have an effect on financial reporting. This is based on the results of research stating that the effectiveness of the internal audit function is able to prevent financial reporting fraud. The professionalism of the internal auditor, who must carry out audits in a correct and professional manner, demonstrates their credibility. This, and audit training, is often not optimal.

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Don’t Fake It If You Can’t Make It: Driver Misconduct in Last-Mile Delivery

Arora,

Choudhary,

Kireyev

2024

Management Science

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In the last two decades, last-mile delivery (LMD) firms have seen immense growth fueled by the success of e-commerce, leading to faster and cheaper deliveries. Operating on thin margins, LMD firms strive for successful first-time deliveries to avoid the financial and reputational costs of reattempts. Delivery agents (DAs) are integral to LMD efficiency, influencing customer experience, delivery success, and productivity. However, most LMD performance enhancement research focuses on process, technology, and incentives, which presume workers will conform to procedures and monitoring tools will function flawlessly. Nevertheless, in practice, DAs deviate from expected behaviors, that is, indulge in misconduct, negatively affecting delivery efficiency, often resulting in returned parcels. One of the major forms of misconduct is entering fake remarks about deliveries, wherein DAs intentionally do not deliver the parcels and provide fake reasons for it. For instance, even without reaching a delivery address, a DA remarks “customer unavailable” and records a delivery failure. In this study, we collaborated with a leading Indian LMD firm and, using instrumental variable regression, found that such misconduct leads to a spillover productivity loss. This effect reduces the next day’s successful deliveries by 1.60% and first-time-right deliveries by 1.86%. We discuss misconduct’s correlation with factors such as task complexity and offer novel insights into how opportunistic circumstances can influence worker behavior. This paper was accepted by Elena Katok, operations management. Funding: V. Choudhary acknowledges the support received from Ministry of Education, Singapore [Grant RS12/20]. Supplemental Material: The online appendix and data files are available at https://doi.org/10.1287/mnsc.2023.01829 .

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Financial reporting misconduct: Evidence from the field

Cited by 5 publications

References 24 publications

Independence, Management Motives and Financial Statement Fraud: Role of Earnings Management

Independence, Management Motives and Financial Statement Fraud: Role of Earnings Management

Risk Management and other Factors Preventing Fraudulent Financial Reporting by State-Owned Enterprises in Indonesia

Don’t Fake It If You Can’t Make It: Driver Misconduct in Last-Mile Delivery

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