Presenting a Conceptual Model of Factors Affecting the Ability of Independent Auditors to Detect Fraud in Financial Statements

Fatehi, Saman; Mahmoudi Khushro,  Omid; Rahmani,  Mahmmoud

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year 16, Issue 64 (2024)

fa 2024, 16(64): 24-45

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Presenting a Conceptual Model of Factors Affecting the Ability of Independent Auditors to Detect Fraud in Financial Statements

Saman Fatehi¹

, Omid Mahmoudi Khushro ^*¹

, Mahmmoud Rahmani²

1- Department of Accounting, Sanandaj Branch, Islamic Azad University, Sanandaj, Iran.
2- Department of Management, Human Science Faculty, Sanandaj Branch, Islamic Azad University, Sanandaj, Iran.

Abstract: (3 Views)

This study aims to develop a conceptual model identifying the factors that influence an independent auditor’s ability to detect fraud in financial statements. Utilizing the Sandelowski and Barroso metasynthesis approach, previous research in this domain was systematically analyzed, and their findings synthesized. In the initial phase, a comprehensive search of relevant articles published over the past two decades yielded 265 studies. Following a rigorous selection process based on predefined criteria and scoring, 80 articles were chosen for final analysis. Through continuous implementation of the metasynthesis method, key concepts and findings were extracted in multiple stages. Ultimately, 37 significant factors influencing fraud detection were identified. Building on expert opinions and evaluating the statistical significance of each factor (p < 0.05, using t-statistics), the Friedman test was employed to rank the identified variables. Fourteen key factors—each with an average rank exceeding five—were determined as the most influential in detecting fraud. In order of importance, these factors include: disclosure, auditor independence, professional competence, financial statement comparability, board and managerial oversight, auditor tenure, ethical obligations, production and sales reporting, stakeholder reporting, experience and job history, discovery opportunity, external cultural, legal, and regulatory factors, demographic variables, and investment. Findings indicate that fraud detection in financial statements is a multidimensional process shaped by various interrelated factors. This study provides valuable insights for enhancing audit quality, strengthening financial oversight mechanisms, and improving fraud detection procedures in corporate financial reporting.

Article number: 2

Keywords: Auditors' Ability, Fraud Detection, Financial Statements, Hybrid Approach.

Full-Text [PDF 859 kb] (3 Downloads)

Type of Study: Research | Subject: Special

References

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Fatehi S, Mahmoudi Khushro O, Rahmani M. Presenting a Conceptual Model of Factors Affecting the Ability of Independent Auditors to Detect Fraud in Financial Statements. fa 2024; 16 (64) : 2
URL: http://qfaj.mobarakeh.iau.ir/article-1-2810-en.html

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