Analysis of Fraud Pentagon and Good Corporate Governance in Indonesian Financial Companies


  • Dwi Puryati STIE Ekuitas
  • Silvia Fudjiyani STIE Ekuitas
  • Putri Lintang Permatasari STIE Ekuitas



Fraud, Fraud Pentagon, Good Corporate Governance


This research will explore the practice of fraud on financial statement and the factors that affect according to Fraud Pentagon Theory using Good Corporate Governance (GCG) as a moderating variable. The research method uses in this study is associative which to examine the relationship to financial statement fraud and the elements that affect fraud are opportunities, pressure, rationalization, competence, and arrogance.  Data in the form of secondary datatype obtained from IDX Statistics. Companies specialized in financial sector in which listed on the Indonesia Stock Exchange in 2021 will be used as the study population. The sampling method uses purposive and a sample of 92 companies. The result exhibits the variables of financial stability, external pressure, competence, and arrogance are having a significant effect upon the fraudulent financial reporting. Financial targets, opportunities, and rationalization have a non-significant effect upon the fraudulent financial statement. Good corporate governance does not moderate the relationship between financial targets, opportunities, rationalization, competence, arrogance, and fraudulent financial reporting variables. Good corporate governance moderates the relationship between financial stability, external pressure, and fraudulent financial reporting variables. The outcome from this research can be a recommendation for companies to reduce fraud through implementation strategies and improve the implementation of good corporate governance so that companies can create value and continue to improve their performance.


Download data is not yet available.


Al-Shammari, M., Rasheed, A., & Al-Shammari, H.A. (2019). CEO narcissism and corporate social responsibility: Does CEO narcissism affect CSR focus? Journal of Business Research, 104, 106-117.

Apriliana, S., & Agustina, I. (2017). The analysis of fraudulent financial reporting determinant through fraud pentagon approach. Dinamika Akuntansi, 9(2), 154-165.

Aris, N., Arif, S. M.M., Othman, R., & Zain, M., M. (2015). Fraudulent financial statement determining using statistical techniques: The case of small medium automative entreprise. Journal of Applied Business Research (JABR), 31(4), 1469-1478.

Arles, L. (2014). Factors Driving the Occurrence of Fraud: Predator vs. Accidental Fraudster Diamond theory Reflection of Fraud Triangle Theory (Classic) A Theoretical Study. Theoretical Review. Riau University.

Association of Certified Fraud Examiners (2022). Report to the Nation on Occupational Fraud.

Association of Certified Fraud Examiners Indonesia Chapter (2019). Survay Fraud Indonesia.

Cressy, D. R. (1953). Other people’s money: The social psychology of embezzlement. New York: The Free Press.

Cross Cultural Management: An International Journal, 16(3), 301-316.

Devi, P. N. C., Widanaputra, A. A. G. P., Budiasih, I. G. A. N., & Rasmini, N. K. (2021). The effect of fraud Pentagon theory on financial statements: Empirical evidence from Indonesia. The Journal of Asian Finance, Economics and Business, 8(3), 1163-1169.

Dewi, I. G., & Pertama, I. G. A. W. (2020). . Perilaku kecurangan akademik mahasiswa akuntansi: Dimensi fraud diamond. JIA (Jurnal Ilmiah Akuntansi), 5(2), 221-234.

Donning, H. A., Eriksson, M. A. T. H. I. A. S., , & Martikainen, M. I. (2019). .Prevention and detection for risk and fraud in the digital age–the current situation. ACRN Oxford Journal of Finance and Risk Perspectives, 8, 86-97.

Haqq, A. P. N. A., & Budiwitjaksono, G. S. (2019). Fraud pentagon for detecting financial statement fraud. Journal of Economics, Business, and Accountancy Ventura, 22(3), 319-332.

Harman, S. A., Bernawati, Y., & Airlangga, U. (2020). Determinants of Financial Statement Fraud: Fraud Pentagon Perspective in Manufacturing Companies. International Journal of Innovation, Creativity and Change, 13(4), 1453-1472.

Horwath, C. (2011). Why the Fraud Triangle is No Longer Enough. www.Crowe.Com.

Kurniawan, P. C., & Izzaty, K. N. (2019). Pengaruh Good Corporate Governance dan Pengendalian Internal Terhadap Pencegahan Fraud. ECONBANK: Journal of Economics and Banking, 1(1), 55-60.

Marczewski, D. C., & Akers, M. D. . (2005). CPAs' Perceptions of the Impact of SAS 99. The CPA Journal.

Maulidi, A. (2022). Philosophical understanding of the dynamics and control of occupational fraud in the public sector: contingency analysis. International Journal of Ethics and Systems, (ahead-of-print).

Michael, C. J., & William, H. M. (1976). Theory of The Firm: Managerial Behavior, Agency Cost and Ownership Structure. Journal of Financial Economics, 3(4), 305-360.

Mohamed, N., Zakaria, N. B., Nazip, N. S. B. M., & Muhamad, N. F. (2021). The influencing factors of employee fraud in Malaysian financial institution: The application of the fraud pentagon theory. Academy of Strategic Management Journal, 20, 1-12.

OJK. (2014). POJK Nomor 33/POJK.04/2014 tentang Direksi dan Dewan Komisaris Emiten atau Perusahaan Publik.

Osma, B. G.-C. (2018). Debt pressure and interactive use of control systems: Effects on cost of debt. Management Accounting Research, 40, 27-46.

Pamungkas, I. D., Ghozali, I., & Achmad, T. (2018). A pilot study of corporate governance and accounting fraud: The fraud pentagon model. Journal of Business and Retail Management Research, 12(2), 253-261.

Pamungkas, I. D., Ghozali, I., Achmad, T., Khaddafi, M., & Hidayah, R. (2018). Corporate governance mechanisms in preventing accounting fraud: A study of fraud pentagon model. Journal of Applied Economic Sciences, 13(2), 549-560.

Prakoso, D. B. (2021). Pengaruh Fraud Diamond terhadap Indikasi Kecurangan Laporan Keuangan (Studi pada Perusahaan Perkebunan yang Terdaftar di Bursa Efek Indonesia Tahun 2015-2019). . Jurnal Akuntansi dan Perpajakan, 7(2), 48-61.

Ramadhan, D. (2020). Root cause analysis using fraud pentagon theory approach (a conceptual framework). Asia Pacific Fraud Journal, 5(1), 118-125.

Rengganis, R. M. Y. D., Sari, M. M. R., Budiasih, I. G. A. N., Wirajaya, I. G. A., & Suprasto, H. B. (2019). The fraud diamond: element in detecting financial statement of fraud. International research journal of management, IT and social sciences, 6(3), 1-10.

Rohmatin, B. L., Apriyanto, G., & Zuhroh, D. (2021). The Role of Good Corporate Governance to Fraud Prevention: An analysis based on the Fraud Pentagon. Jurnal Keuangan dan Perbankan, 25(2), 280-294.

Ruankaew, T. (2016). Beyond the fraud pentagon. International Journal of Business Management and Economic Research, 7(1), 474-476.

Sahla, W. A., & Ardianto, A. (2022). Ethical values and auditors fraud tendency perception: testing of fraud pentagon theory. Journal of Financial Crime, (ahead-of-print).

Sihombing, K. S., & Rahardjo, S. N. (2014). Analisis fraud diamond dalam mendeteksi financial statement fraud: studi empiris pada perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia (BEI) Tahun 2010-2012. Desertation Fafultas Ekonomi dan Bisnis.

Skousen, C. J., & Twedt, B. J. (2009). Fraud score analysis in emerging markets.

Tessa, G. C. (2016). Fraudulent financial reporting: Pengujian teori Fraud Pentagon pada sektor keuangan dan perbankan di Indonesia.

Tiffani, L., & Marfuah, M. (2015). Deteksi financial statement fraud dengan analisis fraud triangle pada perusahaan manufaktur yang terdaftar di bursa efek Indonesia. Jurnal Akuntansi dan Auditing Indonesia, 19(2), 112-125.

Triyanto, D. N. (2020). Detection of Financial Reporting Fraud: The Case of Socially Responsible Firms. . Journal of Economics, Business, & Accountancy Ventura,, 22(3), 399-410.

Wahyuni, W. &. (2017). Fraud triangle sebagai pendeteksi kecurangan laporan keuangan. . Jurnal Akuntansi, 21(1), 47-61.

Widya Ashari, O., & Aris, M. A. . (2022). Pendeteksian Fraudulent Financial Reporting Menggunakan Fraud Pentagon Analysis . (Doctoral dissertation, Universitas Muhammadiyah Surakarta).

Wolfe, David T., and Dana R. Hermanson. "The Fraud pentagon: Considering the Four Elements of Fraud." CPA Journal 74.12 (2004): 38-42.

Zaki, N. M. (2017). The appropriateness of fraud triangle and diamond models in assessing the likelihood of fraudulent financial statements-an empirical study on firms listed in the Egyptian Stock Exchange. International Journal of Social Science and Economic Reserach, 2(2), 2403-2433

Zulaikha, Z., & Hadiprajitno, P. B. (2016). Factors Affecting Procurement Fraud: A Study from the Perspective of External Auditor Perceptions. Indonesian Journal of Accounting and Finance, 13(2), 5.



How to Cite

Puryati, D. ., Fudjiyani, S. ., & Permatasari, P. L. . (2023). Analysis of Fraud Pentagon and Good Corporate Governance in Indonesian Financial Companies. Journal of Management and Muamalah , 13(2), 70 - 84.