Effect of Red Flags and Competence on Fraud Detection with Professional Skepticism as Moderation
DOI:
https://doi.org/10.61132/ijems.v1i1.1043Keywords:
Auditor Competence , Competence, Fraud Detection, Professional Skepticism, Red FlagsAbstract
This study investigates the impact of auditor competence and red flag awareness on fraud detection ability, examining the moderating role of professional skepticism. As fraudulent financial reporting poses a critical threat to the integrity of financial disclosures and stakeholder trust, understanding the key factors influencing an auditor's detection capabilities is essential. This study employed a quantitative approach, gathering data from auditors at Public Accounting Firms (KAP) in Bali Province via a four-point Likert scale questionnaire. The data were subsequently analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS 4 software. The findings indicate that both auditor competence and an awareness of red flags significantly and positively enhance fraud detection capabilities. Conversely, professional skepticism, when analyzed for its direct influence, demonstrated a significant negative effect on this ability. Furthermore, skepticism exhibited a complex moderating role: it significantly weakened the positive relationship between competence and fraud detection, while not significantly moderating the link between red flags and detection ability. These results provide crucial theoretical contributions by revealing the nuanced and sometimes counter-intuitive role of professional skepticism. Practically, they inform policy for audit firms and regulatory bodies, suggesting that while fostering competence and red flag awareness is vital, the application of skepticism requires a more sophisticated and refined approach to truly enhance audit quality and overall fraud detection effectiveness.
Downloads
References
Achmad, F. A., & Galib, S. (2022). Pengaruh red flags, independensi, dan skeptisme profesional terhadap kemampuan auditor dalam mendeteksi fraud. Jurnal Ilmiah Akuntansi Kesatuan, 10(2), 379–392. https://doi.org/10.37641/jiakes.v10i2.1420
Digdowiseiso, K., Subiyanto, B., & Priadi, J. I. (2022). Faktor-faktor yang mempengaruhi kemampuan auditor dalam mendeteksi kecurangan (fraud): Studi empiris pada auditor BPK RI di Jakarta Pusat. Fair Value: Jurnal Ilmiah Akuntansi Dan Keuangan, 4(6), 2621–2627.
Heider, F. (1958). The psychology of interpersonal relations. John Wiley & Sons.
Jayanti, L. G. S. E., & Kawisana, P. G. W. P. (2022). The effect of the implementation of the e-filing system, the role of the account representative, and tax sanctions on taxpayer compliance of personal persons. International Journal of Multidisciplinary Research and Publications (IJMRAP), 5(2), 112–116.
Kurniawati, H. A., Arif, A., & Winarno, W. A. (2017). Analisis minat penggunaan mobile banking dengan pendekatan technology acceptance model (TAM) yang telah dimodifikasi. E-Journal Ekonomi Bisnis Dan Akuntansi, 4(1), 24. https://doi.org/10.19184/ejeba.v4i1.4563
Munteanu, V., Zuca, M. R., Horaicu, A., Florea, L. A., Poenaru, C. E., & Anghel, G. (2024). Auditing the risk of financial fraud using the red flags technique. Applied Sciences, 14(2), 757. https://doi.org/10.3390/app14020757
Narayana, A. A. S. (2020). Auditors’ experience as moderating effect on investigative abilities and understanding of red flags on fraud detection. International Research Journal of Management, IT and Social Sciences, 7(1), 205–216. https://doi.org/10.21744/irjmis.v7n1.837
Natasya, N., Azhar, M. K. S., & Nurmadi, R. (2024). Pengaruh independensi, kompetensi, dan pengalaman audit terhadap pendeteksian kecurangan dengan skeptisisme profesional sebagai pemoderasi. Jurnal Akuntansi Manajemen Ekonomi Dan Kewirausahaan, 4(3), 215–224.
Noch, M. Y., Ibrahim, M. B. H., Kartim, M. A. A., & Sutisman, E. (2022). Independence and competence on audit fraud detection: Role of professional skepticism as moderating. Jurnal Akuntansi, 26(1), 161–175.
Prambowo, E. S., & Riharjo, I. B. (2020). Pengaruh independensi, profesionalisme, dan etika profesi auditor terhadap kinerja auditor. Jurnal Ilmu Dan Riset Akuntansi, 9(11), 1–23.
Prasetya, A., Afrizal, & Putra, W. E. (2023). Skeptisme profesional sebagai variabel intervening hubungan kompetensi auditor, tekanan waktu, dan keahlian forensik terhadap kemampuan auditor mendeteksi kecurangan. Jurnal Akuntansi Trisakti, 10(2), 249–272. https://doi.org/10.25105/jat.v10i2.16913
Rafnes, M., & Primasari, N. H. (2020). Pengaruh skeptisisme profesional, pengalaman auditor, kompetensi auditor, dan beban kerja terhadap pendeteksian kecurangan. Jurnal Akuntansi Dan Keuangan, 9(1), 16–31.
Riadi, S., Nurrahmadini, E. P., Wijayani, D. I. L., & Harlan, F. B. (2025). Fraud detection unveiled: How audit quality shapes auditors’ detection capabilities? International Review of Management and Marketing, 15(2), 254–261. https://doi.org/10.32479/irmm.18188
Robbins, S. P., & Judge, T. A. (2008). Perilaku organisasi (12th ed.). Salemba Empat.
Satria, M. R., & Fatmawati, A. P. (2021). Penyusunan laporan keuangan perusahaan menggunakan aplikasi spreadsheet. Fair Value: Jurnal Ilmiah Akuntansi Dan Keuangan, 3(2), 320–338. https://doi.org/10.32670/fairvalue.v3i2.146
Susilawati, D., Utami, T., & Indriani, A. A. (2022). Meninjau skeptisisme profesional auditor, independensi, dan red flags terhadap kemampuan auditor dalam mendeteksi kecurangan (studi kasus Inspektorat Kabupaten Ponorogo dan Madiun). Widya Dharma Journal of Business, 1(1), 66–80. https://doi.org/10.54840/wijob.v1i01.30
Wahyuni, S., Su’un, M., & Sari, R. (2021). Pengaruh red flags, kompetensi auditor, dan religiusitas terhadap kemampuan auditor dalam mendeteksi kecurangan pada Inspektorat Provinsi Sulawesi Selatan. Paradoks: Jurnal Ilmu Ekonomi, 4(2), 38–48.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 International Journal of Economics and Management Sciences
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
