The purpose of this study is to develop and test a comprehensive model of reduced audit quality behavior. Specifically, this study examines the effects of external locus of control, auditor performance, and organizational commitment on reduced audit quality behavior. To test the hypotheses, a Partial Least Square analysis is applied to questionnaire survey data from 97 auditor working in public accounting firm in Sumatera Island, Indonesia. As hypothesized, the result revealed the existence of a positive influence of external locus of control on reduced audit quality behavior. In addition, auditors performance and organizational commitment also have a negative influence on reduced audit quality behavior. Result also indicates that externals locus of control has an indirect effect on reduced audit quality behavior through auditors performance and organizational commitment. Organizational commitment has an indirect effect on reduced audit quality behavior through auditors performance.

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Objective – The massive and broad impact caused by fraud has made it widely discussed by researchers. Several theories have been developed to explain the cause of fraud. The most recent theory that attempts to explain fraud is pentagon fraud. This study attempts to explain the effect of pentagon fraud on the detection of financial statement fraud in 624 companies listed on the Indonesian stock exchange. Methodology/Technique – Data from financial statements published in 2018 were analyzed using multiple regression analysis. Findings – The results of data analysis using E-Views have proven that Pressure, Opportunity, Arrogance and Rationalization have a negative effect on fraudulent financial reporting. However, competence is known to have no significant effect on fraudulent financial reporting. Novelty – The results suggest that human factors such as pressure, arrogance and rationalization encourage fraudsters to produce fraudulent financial reports. These findings imply that human factors such as pressure arrogance and rationalization are important to be considered in designing any anti-fraud strategy. Type of Paper: Empirical Keywords: Fraud Pentagon; Fraudulent Financial Report; Opportunity, Pressure. Reference to this paper should be made as follows: Nanda; S, T; Zenita R; Salmiah N; 2019. Fraudulent Financial Reporting: A Fraud Pentagon Analysis, Acc. Fin. Review 4 (4): 106 – 113. https://doi.org/10.35609/afr.2019.4.4(2) JEL Classification: M40, M41, M49.

More specifically, it aims to investigate locus of control on intention to quit and auditor acceptance of dysfunctional audit behavior. This study surveys public accounting firm in Sumatera with a total of107 respondents. Data analysis was performed by using Structural Equation Modeling-Partial Least Square (PLS-SEM). The results show that locus of control has positive influence on intention to quit and auditor acceptance of dysfunctional audit behavior. In addition, it is also suggested that the effect of locus of control on auditor acceptance of dysfunctional audit behavior is indirectly influenced through intention to quit.

A broader community is currently paying a significant deal of attention to the existence of social enterprises. This is due to the belief that social enterprises can bring answers to community issues. Village-Owned Enterprises (VOEs), as one of the social enterprises that are expected to continue providing sustainable welfare for villages, must always strive for excellent organizational performance to fulfill their objectives. This study is based on the notion of participatory governance; it seeks to evaluate the effect of governance practices on value co-creation, as well as the effect these practices have on organizational performance. This paper collects data utilizing a structured questionnaire and a quantitative research approach. A cluster sampling methodology is used. The respondents are directors of VOEs in Riau Province, Indonesia. One hundred twenty-five data were analyzed using partial least squares (PLS) of the second order. The results reveal that good governance practices will boost value co-creation, enhancing organizational performance. The findings suggest that VOEs should pay particular attention to their process of managing, monitoring, and accountability to achieve value co-creation and fulfill their mission. The uniqueness of this study lies in its investigation of the governance practices of VOEs and the crucial role of value co-creation in enhancing their organizational performance. AcknowledgmentWe express our gratitude and appreciation to The Directorate of Resources, The Directorate General of Higher Education, The Ministry of Education, Culture, Research and Technology (Ref. 1615/UN.19.5.1.3/PT.01.03/2022) for financial support for this study. We also express the same appreciation to LPPM Universitas Riau for facilitating this research project.