THE EFFECT OF PENTAGON'S FRAUD ON PROFIT MANAGEMENT

Main Article Content

Ana Mardiana Universitas Atma Jaya Makassar, Indonesia
Lukman Lukman Universitas Atma Jaya Makassar, Indonesia
Paulus Tangke Universitas Atma Jaya Makassar, Indonesia

Abstract

Purpose – The purpose of this study was to analyze the effect of pentagon fraud towards earnings management. The fraud pentagon consists of 5 factors that influence the occurrence of fraud, namely: pressure, opportunity, rationalization, capability, and arrogance.


Design/methodology/approach – Multiple regression analysis was used to analyze the data and hypothesis testing was performed using a partial test (t test).


Findings – The results of this study indicate that the five fraud pentagon factors, namely: pressure, opportunity, rationalization, capability, and arrogance have a positive and significant effect on earnings management. The results show that an increase in each factor will significantly improve earnings management in manufacturing companies in Indonesia in the 2018-2020 period.


Originality – The population used in this study are manufacturing companies listed on the Indonesia Stock Exchange (IDX) in the 2018-2020 period.


Keywords: Arrogance, Capability, Earnings Management, Pentagon Fraud, Pressure, Opportunity, Rationalization


Paper Type Research Result

Article Details

How to Cite
Mardiana, A., Lukman, L., & Tangke, P. (2022). THE EFFECT OF PENTAGON’S FRAUD ON PROFIT MANAGEMENT. Contemporary Journal on Business and Accounting, 2(2), 130-158. https://doi.org/10.58792/cjba.v2i2.26

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