Integrated Fraud Risk Factors and Robust Methodology: A Review and Comment

Sitorus, Tumpal Wagner; Scott, D. W.

doi:10.1111/j.1099-1123.2009.00398.x

Cited by 6 publications

(4 citation statements)

References 70 publications

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“…According to Tuanakotta (2010), the pressure or incentive perceived by the perpetrator of fraud viewed as a non-shareable financial need or non-shareable problems. According to Kapardis & Krambia-Kapardis, (2016); Milyutina, (2013); Sitorus & Scott, (2009), pressure usually arises from a critical need or greed in a person who commits fraud. Sometimes it is more related to psychological satisfaction, which proves that one can beat the system.…”

Section: Introductionmentioning

confidence: 99%

The Effect of Internal Financial Indicators on the Tendency of Accounting Fraud

Iswati

Nindito

Zakaria

2017

jda

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This research is carried out to prove factors of tendency of accounting fraud in companies empirically. Variable used in predicting the tendency of accounting fraud is profitability level, capital turnover, financial leverage, assets composition, and firm size tendency of accounting fraud. The population is companies registered in Indonesia Stock Exchange that are suspected to fraud the accounting during observation year 2013 2015. Samples are taken by using purposive sampling, there are 12 companies are proven to be done fraud accounting and 12 companies are not. Data is analysed by using logistic regression analysis and Hosmer and Lemeshow test to measure the model. The result shows that capital turnover and assets composition has significant influence on tendency of accounting fraud. Besides, profitability, financial leverage, and firm size has insignificant influence on tendency of accounting fraud variable. This research concluded that capital turnover and assets composition can be used as predictor of tendency of accounting fraud in a company.

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Section: Introductionmentioning

confidence: 99%

The Effect of Internal Financial Indicators on the Tendency of Accounting Fraud

Iswati

Nindito

Zakaria

2017

jda

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“…The opportunity was therefore created by collusion between a number of parties, and it is hard to point to any particular group as the sole perpetrator responsible for the fraud. Sitorus and Scott (2009) recently suggested that collusion is an important risk factor, and the Danish asset-stripping case supports this view. The parties colluding in stripping companies formed a wide network with relations to the top of the legal system.…”

Section: Jfc 181mentioning

confidence: 88%

Asset stripping in a mature market economy

Jeppesen

Møller²

2011

Journal of Financial Crime

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Purpose -The purpose of this paper is to document a Danish fraud scheme, in which a large number of limited companies were stripped of their assets leaving them with nothing but tax debt, eventually causing the Danish Tax and Customs Administration to lose large sums. Furthermore, the purpose is to analyse why the asset-stripping schemes occurred in a mature market economy with a strong corporate governance system and a low level of corruption. Design/methodology/approach -The research is conducted as a longitudinal single case study based on documentary research. Findings -The Danish case indicates that asset stripping may take place in mature market economies to the extent that perpetrators are able to circumvent the corporate governance system by giving lawyers, public accountants and banks incentives to act less critically towards dubious business transactions.Research limitations/implications -The opportunity and rationalisations supporting the fraud are particular to the Danish context. Practical implications -The paper provides insights into the consequences of professionals disregarding their duty to serve the public interest. Social implications -The paper provides an example on how to circumvent the social supervisory system of a mature market economy. Originality/value -The paper contributes to the knowledge about asset stripping by documenting and analysing the phenomenon in a mature market economy context.

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“…1 (DISAPA 1993) emphasised that Downloaded by [Cukurova Universitesi] at 01:55 02 November 2014 intentional errors and mistakes might remain undetected even when an audit was planned and conducted in accordance with 'good audit practice'. Evidently, the standards of this period did not establish proactive responsibilities for the detection and prevention of fraud, unlike post-1996 standards (Sitorus and Scott 2009;Holm, Langsted, and Seehausen 2012). While the promulgations added a regulatory layer to the interpretation of 'good audit practice' as interpreted by the professional body, the latter could still be challenged in the judicial system when determining the auditor's responsibilities in relation to specific fraud cases.…”

Section: The Role Of the Professional Bodiesmentioning

confidence: 92%

“…Over the years, various researchers have discussed the extent and nature of the auditor's responsibilities in relation to fraud (Chandler, Edwards, and Anderson 1993;Dezoort and Lee 1998;Sitorus and Scott 2009). For the audit profession it has been a challenge to maintain public trust Downloaded by [Cukurova Universitesi] at 01:55 02 November 2014 when facing fraud scandals (Satava, Caldwell, and Richards 2006;Cowton 2009).…”

Section: Prior Research and Methodologymentioning

confidence: 99%

Civil and common law influences on the Danish auditor's responsibilities in relation to fraud

Holm

2014

Accounting History Review

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We use a legal perspective to examine how the role of auditors in Denmark has been defined and the auditor's responsibilities in relation to fraud have been determined. The study draws on laws, legal cases and documents produced by professional organisations. We show that developments during the twentieth century were conditioned by the central legislative role of the Danish state combined with a hands-off approach to enforcing new law provisions. While the organising role of the state was consistent with the Roman civil law tradition, the implications of legislative absences, and later provisions in the form of 'general principles legislature', ensured that the role of the auditor was defined as a result of market forces and the judicial processes of the courts. We observe that in the Danish legal system important interpretative powers are granted to the courts in line with case law traditions in common law systems. An examination of fraud cases handled by the courts and disciplinary tribunals suggests that an important role was played by the professional organisation in Denmark.

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Integrated Fraud Risk Factors and Robust Methodology: A Review and Comment

Cited by 6 publications

References 70 publications

The Effect of Internal Financial Indicators on the Tendency of Accounting Fraud

The Effect of Internal Financial Indicators on the Tendency of Accounting Fraud

Asset stripping in a mature market economy

Civil and common law influences on the Danish auditor's responsibilities in relation to fraud

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