The Effect of Arrogance and Collusion on Fraudulent Financial Statements (in the automotive and components sub-sector on the IDX 2017-2021)

• Author(s): Citra Kurnia Bumi ; Supriatiningsih
• Paper ID: 1704380
• Page: 55-67
• Published Date: 08-05-2023
• Published In: Iconic Research And Engineering Journals
• Publisher: IRE Journals
• e-ISSN: 2456-8880
• Volume/Issue: Volume 6 Issue 11 May-2023

Abstract

Fraud in financial statements is a paradigm that often occurs in Indonesia and causes many losses. Therefore, the purpose of this study is to detect potential fraudulent financial statements by using hexagon fraud which is focused on arrogance and collusion. In the fraud hexagon there are six dominant factors that can trigger the emergence of fraud against financial statements, namely pressure, opportunity, rationalization, ability, arrogance and collusion. In this study will focus on arrogance and collusion. Arrogance is proxied by CEO duality and collusion is proxied by political connections. In this study, the dependent variable was measured using the F-Score Model in order to find out how big the potential for fraud to appear in financial statements. The purposive sampling technique was used in this study to obtain a population sample with the criteria of BUMN companies listed on the Indonesia Stock Exchange, for the last 5 years, namely, 2017 – 2021 which have always reported their financial statements in rupiah. The results of this study indicate that the personal financial need, CEO duality and political connection variables have an influence on the potential for fraud to arise in financial reports.

Keywords

Financial Statement Fraud, Arrogancy, Collution Hexagon Theory, Fraud.

Citations

IRE Journals:
Citra Kurnia Bumi , Supriatiningsih "The Effect of Arrogance and Collusion on Fraudulent Financial Statements (in the automotive and components sub-sector on the IDX 2017-2021)" Iconic Research And Engineering Journals Volume 6 Issue 11 2023 Page 55-67

IEEE:
Citra Kurnia Bumi , Supriatiningsih "The Effect of Arrogance and Collusion on Fraudulent Financial Statements (in the automotive and components sub-sector on the IDX 2017-2021)" Iconic Research And Engineering Journals, 6(11)