Detecting Indications of Financial Statement Fraud: a Hexagon Fraud Theory Approach

This study emphasizes on examining the fraud hexagon theory referring to signs of financial statements, which employs all manufacturing companies listed in IDX (Indonesia Stock Exchange). However, total selected sample are 153 industry. The categorized into indicated and not committing 2010-2018 period by applying Beneish M-Score. findings demonstrated that stability, targets, external pressures, nature industry, CEO duality can be applied predict statements. Meanwhile, personal needs, ineffective monitoring, quality auditors, auditor turnover, director marginal costs cannot indicate occurrence statement. conclude pressure, ego, opportunity significantly affect statement fraud. Future research suggested consider different proxies for fraudulent statements; hence, accuracy compared with this study. Moreover, adding other conspiracy such as bonuses received managers will beneficial.