Corporate Fraud and Managers’ Behavior

Source
academic

Based on evidence from press articles covering 39 corporate fraud cases that went public during the period 1992-2005, the objective of this paper is to examine the role of managers’ behavior in the commitment of the fraud. This study integrates the fraud triangle (FT) and the theory of planned behavior (TPB) to gain a better understanding of fraud cases. The results of the analysis suggest that personality traits appear to be a major fraud risk factor. The analysis was further validated through a quantitative analysis of key words which confirmed that key words associated with the attitudes/rationalizations component of the integrated theory were predominately found in fraud firms as opposed to a sample of control firms. The results of the study suggest that auditors should evaluate the ethics of management through the components of the theory of planned behavior: the assessment of attitude, subjective norms, perceived behavioral control and moral obligation. Therefore, it is potentially important that the professional standards that are related to fraud detection strengthen the emphasis on managers’ behavior that may be associated with unethical behavior.

Source
Carroll School of Management at Boston College, USA China-Europe International Business School (CEIBS), Shanghai, China HEC Paris, France
Length of Resource
52 pages
Author
Jeffrey R. Cohen, Yuan Ding, Cédric Lesage, Hervé Stolowy
Date Published
Publication Type
paper
Resource Type
academic

ResourceID: 169816

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