The incidence of accounting fraud is increasing: is it a matter of the gender of chief financial officers?

Abstract

Purpose The purpose of this paper is to examine the association between accounting fraud and the gender of chief financial officers (CFOs). Design/methodology/approach This study uses a sample of US-listed firms for the period from 2000 to 2010. This paper takes this distribution of the sample observations because firms sanctioned by the Securities and Exchange Commission as reported in Accounting and Auditing Enforcement Releases for fraud are more heavily weighted in the 2000 to 2010 period. Findings This study provides considerable evidence to suggest that firms with female CFOs are negatively associated with accounting fraud. The study also suggests that in state-owned enterprises, in which political concerns are likely to be more pronounced, the relationship between female CFOs and accounting fraud is negatively less significant. This study conducts an additional test about when and why boards’ diversity reduces accounting fraud or concerns. The result shows that the structure of gender-mixed boards is better than male-only boards. Therefore, it is important to control the activities or decisions of powerful chief executive officers. Research limitations/implications In general, the findings contribute to the current discussion on the necessity of increasing gender diversity as a corporate governance mechanism. This study is specifically focussed on CFOs that may directly have important implications for financial reporting and corporate governance. Originality/value This paper extends prior research by addressing the potential effects of female CFOs on accounting fraud. For example, Zhou et al. (2018) examine the relationship between executive compensation and the incidence of corporate fraud in Chinese listed companies from the perspective of delisting pressure. The result documents that there is no a relationship between CFO gender and accounting fraud. The results, however, find that female CFOs are negatively associated with accounting fraud; meaning that the presence of female CFOs brings positive implications for financial reporting and corporate governance.

Tata Kelola Perusahaan Dalam Mengurangi Kecurangan Laporan Keuangan (Systematic Literature Review Dengan Metode Meta Sintesis)

“…Beberapa penelitian menjelaskan kondisi yang dapat memperkuat peran wanita dalam mengurangi kecurangan akuntansi, seperti kualitas audit yang tinggi sebagai pendukung pengawasan, serta memperbaiki kualitas pengendalian internal dan kualitas laporan keuangan (Kouaib & Almulhim, 2019;Li & Li, 2020). Meski demikian, ditemukan sejumlah isu yang dapat menghalangi pengaruh wanita dalam mengurangi kecurangan akuntansi, seperti adanya dualitas CEO yang dapat menyebabkan kekuasaan berlebih (overpower) pada satu individu (Wahyuningtyas, 2021), lingkungan yang diskriminasi terhadap kehadiran wanita (Liao et al, 2019;Wahyuningtyas, 2021). Serta, perusahaan yang sarat akan unsur politik dan konflik kepentingan (Liao et al, 2019).…”

“…Hasil sintesis kami menunjukkan terdapat empat topik utama terkait manajemen yang menjadi fokus para Peneliti, antara lain: a. Pemimpin wanita (Liao et al, 2019;Sun et al, 2019;Wahyuningtyas, 2021). b. Dualitas CEO (Martins & Junior, 2020;Montesdeoca & Medina, 2019;Nasir et al, 2019;Petrou & Procopiou, 2016;Rostami & Rezaei, 2021).…”

“…Terdapat konsistensi hasil yang menunjukkan bahwa eksistensi wanita sebagai pemimpin secara signifikan berpengaruh negatif terhadap kecenderungan perusahaan untuk melakukan kecurangan laporan keuangan. Eksistensi wanita sebagai pemimpin memberikan dampak yang serupa dengan pengaruh wanita dalam dewan komisaris (Liao et al, 2019;Sun et al, 2019;Wahyuningtyas, 2021). Kondisi yang dapat memperkuat peran wanita dalam mengurangi kecurangan akuntansi, meliputi proporsi wanita dalam dewan komisaris, di mana perusahaan dengan CFO wanita umumnya memiliki proporsi wanita yang tinggi dalam dewan (Wahyuningtyas, 2021), serta kualitas audit yang tinggi (Kouaib & Almulhim, 2019).…”

“…Eksistensi wanita sebagai pemimpin memberikan dampak yang serupa dengan pengaruh wanita dalam dewan komisaris (Liao et al, 2019;Sun et al, 2019;Wahyuningtyas, 2021). Kondisi yang dapat memperkuat peran wanita dalam mengurangi kecurangan akuntansi, meliputi proporsi wanita dalam dewan komisaris, di mana perusahaan dengan CFO wanita umumnya memiliki proporsi wanita yang tinggi dalam dewan (Wahyuningtyas, 2021), serta kualitas audit yang tinggi (Kouaib & Almulhim, 2019). Meski demikian, ditemukan sejumlah isu yang dapat menghalangi pengaruh pemimpin wanita dalam mengurangi kecurangan akuntansi, seperti lingkungan yang diskriminasi terhadap kehadiran wanita (Liao et al, 2019;Wahyuningtyas, 2021).…”

Gender Diversity Impact on ESG Performance: Evidence from Indonesian and Malaysian Manufacturing Sector

“…The promotion of women's empowerment and gender equality is one of the primary goals of the United Nations Development Program (UNDP). Little is known about the correlation between the gender gap in careers and corporate success [2]. This is a significant problem since disparities in firm success might be partially attributable to changes in characteristics connected with the chief executive officer (CEO).…”