Article: Fraudulent financial reporting analyses using Beneish model: evidence from Malaysian public companies Journal: Global Business and Economics Review (GBER) 2023 Vol.29 No.1 pp.107 - 132 Abstract: Increasing fraud cases are alarming, particularly during economic instability periods. In meeting the financial targets and secure financing to sustain business activities, companies may be involved in fraudulent activities. However, such unethical behaviour will adversely affect the sustainability of the business in the long run. Adopting agency theory, this study intends to explore the influence of firm characteristics and corporate governance attributes on the fraudulent financial reporting (FFR) proxied by Beneish model. Based on 754 firm-year observations from public listed companies in Bursa Malaysia from 2018 to 2020, it is found that only firm characteristics have influenced the inclination for fraudulent financial reporting activities. Apart from contributing additional knowledge to existing literature, this study is expected to provide valuable insights to the industry players in Malaysia to curb fraudulent activities through appropriate monitoring mechanisms, from both the firm characteristics and governance. Inderscience Publishers - linking academia, business and industry through research

Title: Fraudulent financial reporting analyses using Beneish model: evidence from Malaysian public companies

Authors: Nurshamimi Sabli; Rosmini Mohd Aripin; Radziah Mahmud; Roszana Tapsir

Addresses: Faculty of Accountancy, Universiti Teknologi MARA (UiTM) Cawangan Selangor, Puncak Alam Campus, Malaysia ' Faculty of Accountancy, Universiti Teknologi MARA (UiTM) Cawangan Selangor, Puncak Alam Campus, Malaysia ' Faculty of Accountancy, Universiti Teknologi MARA (UiTM) Cawangan Selangor, Puncak Alam Campus, Malaysia ' Faculty of Accountancy, Universiti Teknologi MARA (UiTM) Cawangan Selangor, Puncak Alam Campus, Malaysia

Abstract: Increasing fraud cases are alarming, particularly during economic instability periods. In meeting the financial targets and secure financing to sustain business activities, companies may be involved in fraudulent activities. However, such unethical behaviour will adversely affect the sustainability of the business in the long run. Adopting agency theory, this study intends to explore the influence of firm characteristics and corporate governance attributes on the fraudulent financial reporting (FFR) proxied by Beneish model. Based on 754 firm-year observations from public listed companies in Bursa Malaysia from 2018 to 2020, it is found that only firm characteristics have influenced the inclination for fraudulent financial reporting activities. Apart from contributing additional knowledge to existing literature, this study is expected to provide valuable insights to the industry players in Malaysia to curb fraudulent activities through appropriate monitoring mechanisms, from both the firm characteristics and governance.

Keywords: fraudulent financial reporting; FFR; firm characteristics; corporate governance; Beneish model.

DOI: 10.1504/GBER.2023.131948

Global Business and Economics Review, 2023 Vol.29 No.1, pp.107 - 132

Received: 13 Nov 2021
Accepted: 27 Apr 2022
Published online: 05 Jul 2023 *

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Title: Fraudulent financial reporting analyses using Beneish model: evidence from Malaysian public companies

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