The BIG 4 Role in Moderating the Detection of Fraud Pentagon Against Fraudulent Financial Reports (Study on Indonesian Public Sector Government Companies)
Keywords:
BUMN, Indonesia, Auditor, Fraud Pentagon, Restatement, Fraudulent Financial ReportsAbstract
This research aims to analyze the role of Big 4 Firms (EY, PWC, Deloitte, KPMG) in moderating the fraud pentagon effect of pressure, rationalization, opportunity, competence, and arrogance against fraudulent financial reports. Data taken from annual reports included in BUMN20 Index from Indonesian stock exchange during 2016-2018. Using the purposive sampling technique comprise of 66 companies with statistical analysis and regression model by EViews. Results of this research are (1) Financial Stability which measured by Asset Grow as the proxy of Pressure element from Fraud Pentagon, has significant effect to the likelihood of Fraudulent Financial Reports, (2) New proxied of Rationalization which measured by Government Ownership has significant effect to the likelihood of Fraudulent Financial Reports, (3) BIG 4 proven can moderate by weakening the Fraud Pentagon effect to the Fraudulent Financial Reports.
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