Forensic accounting tools for fraud deterrence: a qualitative approach

Abstract

Purpose The purpose of this paper is to understand if forensic accounting techniques and tools could contribute to the deterrence of fraud in financial statements, considering the expertise of forensic accountant on ex post activities and that the traditional mechanisms to prevent this type of fraud have not been sufficient to stop the impact on companies, investors, auditors, employees and on society in general. Design/methodology/approach This research was carried out using a qualitative exploratory study with a phenomenological approach conducted through in-depth interviews with professional experts in the forensic field. Findings The findings confirm that the use of forensic accounting techniques and tools could contribute to the prevention of fraud in financial reporting not only when the risk of fraud has been materialized. Similar studies, about fraud prevention addressing the situation under a qualitative approach from the perspectives of its protagonists, have not been observed in the bibliographical review, so this research contributes to expanding the scientific research, the study and practice of forensic accounting. Originality/value From a business management perspective, this study contributes a paradigm shift from the traditional ex post forensic auditing activity toward an ex ante activity to improve management control systems within organizations anywhere in the world. Because this study is guided to prevent fraudulent financial statements, other fraud categories such as misappropriation or corruption could be addressed in other studies and various countries.

Evaluating the perceived usefulness and fairness of forensic accounting and investigation standards

“…In forensic accounting, professionals use their accounting expertise and investigative skills to investigate financial records and transactions to detect fraud, misappropriation and other financial crimes (Eiya et al , 2013; Navarrete and Gallego, 2022). A set of qualified principles and standards must guide forensic accounting practice.…”

Divergence and convergence of salient stakeholders' perceptions toward forensic accounting education: importance, obstacles and pedagogies

“…Experts in the field acknowledge a rising demand for services related to forensic accounting. They propose that offering distinct courses in forensic accounting at both postgraduate and bachelor’s levels would be beneficial (Akour et al ., 2023; Al-Hazaima et al ., 2021; Alshurafat et al ., 2022; Clavería Navarrete and Carrasco Gallego, 2023; Honigsberg, 2020; Ismail et al ., 2022). According to Rezaee et al .…”

“…In recent years, forensic accounting has become integral to the curricula of Jordanian universities (Alshurafat et al. , 2021b; Clavería Navarrete and Carrasco Gallego, 2023; Kresse, 2008; Pearson and Singleton, 2008; Ramamoorti, 2008; Yang and Lee, 2020). It is a crucial area that benefits accounting students in their potential job orientation (Kramer et al ., 2017).…”

How to identify norms, laws, and regulations that facilitate illicit financial flows and related financial crimes

“…Fraud, which often precedes illicit financial flows, can also be included in the examination. Previous research has been proficient in studying fraudulent financial reporting (Cooper, Dacin and Palmer, 2013; Gullkvist and Jokipii, 2013; Johnson, Grazioh and Jamal, 1993; Maulidi and Ansell, 2020; Kassem, 2021; Navarrete and Gallego, 2022; Palmer, 2018; Morales, Gendron and Guénin-Paracini, 2014; Ratzinger-Sakel and Tiedemann, 2022; Saluja et al , 2021). Similarly, many studies address the concept of the fraud triangle, comprising three conditions for fraud, namely: motive/pressure, opportunity and rationalization, as well as several possible other conditions for fraud (Cheliatsidou et al , 2023; Homer, 2020; Kagias et al , 2022; Maulidi and Ansell, 2020; Morales, Gendron and Guénin-Paracini, 2014; Saluja et al , 2021).…”