Fraud Triangle (Pressure, Opportunity, And Rationalization) and The Level Of Accounting Irregularities in Indonesia

• In Event: International Accounting 1

Abstract

Purpose of this research is to find empirical evidence about impact of pressure, opportunity,
and rationalization (fraud triangle) to the level of accounting irregularities in Indonesia. The
sample are taken from non-financial company that was proven to violate BAPEPAM’s rule
during 2007-2013. It test all cases of BAPEPAM’s rule violation for the first sample and only
financial statement’s violation cases for the second sample. Ordered logistic regression is
used to test the hypothesis. As a result, it is found that probability of increasing level of
accounting irregularities are affected by financial stability (pressure), financial target
(pressure), nature of industry (opportunity), and ineffective monitoring (opportunity).
Rationalization are not effect the probability of increasing level of accounting irregularities.

Authors

• aditya prayatna, universitas indonesia

• Fitriany abdul mutholib, universitas indonesia