Factors Indicative of Propensity for Committing Accounting Fraud Among Organizations: A Validation Research

Abstract

This study looks into several variables, identified through exhaustive literature review, and validated through a survey administered to accounting professionals, on whether these variables are indicators of propensity for accounting fraud. These variables are financial statement items; executives, managers, employees' actions and relationship/behavior with other partners; audit quality; accounting and financial reports / related documents; and financial ratios. Using ANOVA and independent samples t-test to determine statistical significance of differences of responses by grouping the respondents by accounting profession, age, years of professional experience, and gender, the study found financial statement items; executives, managers, employees' actions and relationship/behavior with other partners; and accounting and financial reports / related documents; and financial ratios to be possible indicators of accounting fraud.