The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies

Studies Management and Finance Economics, of Journal 0504-2644 (online): ISSN 0490,-2644 (print): ISSN 5202 December 12 Issue 80 Volume 8.317 Factor: Impact ,61-i12-10.47191/jefms/v8 DOI: Article 2328-8214 No: Page JEFMS, Volume 08 Issue 12 December 2025 www.ijefm.co.in Page 8214 The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies Mita Rizki Amalia1, E.Yusnaini2, Rela Sari3 1,2,3Postgraduate Program in Economics, Accounting Concentration, Sriwijaya University ABSTRACT: Financial statement fraud is one form of fraud that has the most damaging impact on the sustainability of the company, the stability of the financial industry, and public trust. This phenomenon is increasingly complex with increasing business pressures, financial market dynamics, and changes in accounting standards that expand the scope of managerial considerations. This study aims to provide empirical evidence regarding the influence of the six elements of the Fraud Hexagon Pressure, Opportunity, Rationalization, Ability, Ego, and Collusion on financial statement fraud in financial sector companies listed on the Indonesia Stock Exchange (IDX) for the period 2020-2024. In addition, this study examines whether accounting complexity acts as a moderating variable that can strengthen or weaken the relationship between the Fraud Hexagon and financial statement fraud. The study uses a quantitative approach with panel data regression. Model selection is carried out through the Chow and Hausman Test , which shows that Fixed The Effect Model (FEM) was the best model. The results showed that the variables Pressure (X1), Ability (X4), and Collusion (X6) had a positive and significant effect on financial statement fraud, while Opportunity (X2), Rationalization (X3), and Ego (X5) had no significant effect. Accounting complexity was not proven to be a moderating variable. These findings emphasize the importance of strengthening internal control systems and corporate governance oversight to reduce fraud risk. KEYWORDS: Fraud Hexagon, Financial Reporting Fraud, Accounting Complexity I. INTRODUCTION Financial statement fraud is a form of fraud that has the most destructive impact on company sustainability, financial market stability, and public trust. As a sector that relies heavily on transparency and information integrity, the financial industry demands high reporting standards. However, a number of high-profile cases in Indonesia, such as the PT Jiwasraya Insurance , PT Asabri , and KSP Indosurya shows that the practice of financial reporting manipulation remains widespread. These cases not only cause significant financial losses but also undermine public trust in financial institutions and the effectiveness of existing oversight systems. Fraud in financial reporting can be committed in various ways , including revenue manipulation, concealment of losses, unrealistic asset presentations, and fabrication of credit loss reserves. The complexity of the financial industry, the large volume of transactions, and the high demand for accounting estimates provide ample room for management to engage in judgmentbased manipulation. It is in this context that modern fraud theories such as the Fraud Hexagon become relevant. This theory was developed by Vousinas (2019) as a refinement of the Fraud Triangle , Fraud Diamond , and Fraud Pentagon . Fraud Hexagon adds two new elements, namely Ego And Collusion , which is considered increasingly dominant in modern corporate fraud. The elements of the Fraud Hexagon are : Pressure , Opportunity , Rationalization , Capability , Ego ( arrogance ) , and Collusion provides a comprehensive perspective on why fraud occurs . Pressure arises from performance expectations, financial issues, and external pressures. Opportunities arise from weak internal controls. Rationalization allows the perpetrator to justify the act of fraud . Capability refers to the perpetrator's technical capacity and access to commit fraud . Ego is related to arrogance or abuse of power. Collusion describes cooperation between two or more parties to facilitate fraud . In addition to behavioral factors, technical conditions such as accounting complexity also contribute to fraud risk . The implementation of new standards such as PSAK 71, PSAK 72, and PSAK 73 increases the need for estimates and the use of The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies JEFMS, Volume 08 Issue 12 December 2025 www.ijefm.co.in Page 8215 complex models, thus opening up room for management to engage in manipulation that is difficult for auditors or stakeholders to identify. Accounting complexity is believed to strengthen the relationship between the Fraud Hexagon and financial statement fraud because it creates opportunities for irregularities that are more difficult to detect. Although the Fraud Hexagon has been widely discussed theoretically, empirical research in Indonesia, particularly in the financial sector, remains limited. Previous studies have largely utilized the Fraud Triangle or Fraud Diamond , while testing the Fraud Hexagon in the modern financial industry and the post-pandemic period is still rare , creating a research gap. Therefore, this study was conducted to provide empirical evidence regarding the influence of Fraud Hexagon on financial reporting fraud in financial sector companies in Indonesia, as well as to analyze whether accounting complexity moderates this relationship. The research results are expected to provide significant contributions both theoretically and practically, including for academics, regulators, auditors, and company management. II. LITERATURE REVIEW A. Agency Theory Agency Theory, introduced by Jensen and Meckling (1976), explains the contractual relationship between the principal (company owner) and agent (management). In this relationship, the principal gives the agent authority to manage the company and make decisions that are considered best for the company. How ever, differences in goals, personal interests, and levels of information create the potential for conflict known as agency. conflict . In the context of fraud , agency theory explains that management can exploit information gaps and oversight weaknesses to commit financial statement fraud. When the principal is unable to evaluate management decisions comprehensively, the agent may act in personal interests, even if it is detrimental to the company. This theory is the basis for why the factors in the Fraud Hexagon are relevant in explaining fraudulent behavior. B. Fraud Hexagon Fraud Hexagon is the latest development theory in the fraud literature put forward by Vousinas (2019) to explain the causes of fraud more comprehensively than previous models such as Fraud Triangle, Fraud Diamond , and Fraud Pentagon . This theory is very relevant to use in the context of financial sector companies, as in this study, because fraud that occurs in the financial industry tends to be complex, involves many parties, and is often related to performance pressure and management flexibility in processing accounting estimates. The Fraud Hexagon explains that fraud is influenced not only by pressure, opportunity, and rationalization, but also by the perpetrator's ability, ego, management, and collusion within the company. The following explains the six elements of the Fraud Hexagon: The first element, Pressure , is pressure to commit fraud that is financial and non-financial in nature. Pressure can take many forms such as high financial needs, the need to report better results due to pressure to meet targets especially during times of crisis as quickly as possible and also sometimes simply a person's desire to prove that they can beat the system (related to ego). In crisis years, the potential for fraudulent acts is higher which is a result of the economic recession and pressure from employers to meet business objectives along with cost cutting due to tight budgets, where their financial position or professional status within the company will not be affected. The second element is Opportunity , which is one of the elements in the triangle fraud theory which occurs due to weak supervision and control systems implemented in the company. Business design often provides ample opportunities for fraudsters, leading to theft or misuse of assets. SAS No. 99 states three categories of conditions that create opportunities for financial fraud: the nature of the industry, ineffective monitoring , and organizational structure . According to Rahmawati (in Larum et al., 2021), there are several causes of opportunities for someone to commit fraud, such as weak internal controls, indiscipline, difficulty accessing information, the absence of an audit process, and apathy. The third element, Rationalization, is the perpetrator's attempt to justify their actions by arguing that they deserve a larger share of the proceeds (Sagala & Siagian, 2021). Companies that frequently change their internal audit committees allow for manipulation of their financial reports. This is done to rotate the audit committee so that the new audit committee is unaware of the problems that occurred previously. The fourth element is Capability, as a person's ability to override internal controls, practice and develop fraudulent strategies, and control social situations to gain their advantage Marks (2014). According to Wolfe & Hermanson (2004), fraudulent acts cannot occur if a person does not have the capability to do so . The fifth element, Ego (Arrogance), is an element of fraud that shows the attitude of an individual who feels that with his position he can avoid internal supervision and the individual feels that he is unlikely to be involved in fraud Sagala & Siagian, The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies JEFMS, Volume 08 Issue 12 December 2025 www.ijefm.co.in Page 8216 (2021). Research by Yusof et al. (2015) shows that the element of arrogance can be measured by looking at the presence of a CEO who is also a politician, the frequency of appearance of CEO images, autocratic leadership style , and the presence of CEO duality (a CEO who also serves as part of the board of directors in the same company). The sixth element is Collusion, which refers to a fraudulent agreement or compact between two or more persons, whereby one party commits an act against another for a malicious purpose and to defraud a third party of its rights. The parties involved in collusion may be employees within an organization, a group of individuals from different organizations and jurisdictions, or members of a criminal organization or collective. Venter (2007) and Vousinas (2019). Thus, Fraud Hexagon explains that fraud is not an act that occurs spontaneously, but is the result of a complex interaction between pressure, opportunity, rationalization, individual abilities, the psychological characteristics of the perpetrator, and social dynamics within the organization. This model provides a more realistic perspective on modern fraud, particularly as it highlights the roles of ability, ego, and collusion, which are highly relevant to major fraud cases in today's era. The Fraud Hexagon Theory also reinforces the view that fraud prevention can not only be done through strengthening internal controls, but also through managing organizational culture, increasing transparency, monitoring management behavior, and mitigating the risk of collusion between parties within the company. C. Accounting Complexity Accounting complexity refers to the degree of difficulty in understanding, applying, and assessing information in financial statements due to the increasing number of accounting standards, measurement methods, and estimates used. This complexity arises when the reporting process requires a high level of professional judgment, the use of long-term economic assumptions, and extensive and technical disclosures. In financial sector companies, accounting complexity becomes increasingly prevalent due to the nature of transactions involving risky financial instruments, derivative contracts, allowances for credit losses, and fair value measurements that are highly sensitive to changes in market conditions. The adoption of IFRS-based accounting standards, particularly PSAK 71, PSAK 72, and PSAK 73, has increased the complexity of reporting in Indonesia. PSAK 71 requires the use of an expected credit loss (ECL) model, which requires an assessment of the probability of default and projections of macroeconomic conditions. PSAK 72 requires the identification of performance obligations in revenue contracts, while PSAK 73 adds the requirement to recognize right-of-use assets and lease liabilities based on estimates of future cash flows. These standards expand the scope for management judgment, resulting in financial statements being increasingly influenced by subjective assumptions and estimates. Previous research supports the role of accounting complexity as a factor influencing the quality and transparency of financial reporting. Hoitash and Hoitash (2017) showed that reporting complexity measured through XBRL structure is associated with increased audit risk and decreased readability of financial statements. In the context of oversight, high complexity increases the auditor's burden, thus increasing the likelihood of undetected misstatements. Other research , such as Barber and Hollie (2020), indicates that the complexity of accounting methods can improve reporting quality when applied conservatively, but still creates challenges for report users who lack adequate technical competence. In Indonesia, Rais (2020) found that accounting complexity negatively impacts reporting timeliness, which has implications for investor perceptions of company credibility. In relation to fraud, accounting complexity is seen as a factor that can open up opportunities for financial report manipulation. The more complex a report is, the more difficult it is for auditors and stakeholders to assess the fairness of the information presented, so that manipulation actions carried out through adjustments to estimates or incomplete disclosures can be more easily disguised. In financial sector companies, accounting complexity has the potential to strengthen the influence of pressure, ability, and collusion, the three elements of the Fraud Hexagon that have been proven significant in previous research on financial statement fraud. Therefore, in this study, accounting complexity is positioned as a moderating variable that can strengthen or weaken the relationship between Fraud Hexagon and financial reporting fraud. D. Financial Reporting Fraud According to Nurul Husna et al . (2023), financial statement fraud can arise through various forms of manipulation, such as timing differences carried out by shifting the time of transaction recognition as occurred in the TaniHub case to show better performance; fictitious revenues , namely recording income without real transactions such as in PT Artha Cemerlang Finance; canceled liabilities and expenses , namely the elimination or concealment of liabilities as found in the LPEI case which covered up credit risk; improper disclosure , namely the disclosure of unreasonable material information such as in the case of Bank BJB which did not report the difference in promotional funds transparently; and improper asset valuation , namely asset valuation that does not comply with accounting principles such as in the case of PT Taspen which continued to record the full value of The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies JEFMS, Volume 08 Issue 12 December 2025 www.ijefm.co.in Page 8217 problematic investments. These various forms of fraud show that manipulation can occur in revenue recognition, transaction timing, liabilities, disclosure, and asset valuation, thus threatening the reliability of financial statements and underscoring the importance of internal control and compliance with accounting standards. III. DEVELOPMENT OF RESEARCH HYPOTHESES H1 : Pressure influences financial reporting fraud in financial sector companies listed on the IDX during the 2020-2024 period. H2 : Opportunity influences financial reporting fraud in financial sector companies listed on the IDX during the 2020-2024 period. H3 : Rationalization has an impact on financial reporting fraud in financial sector companies listed on the IDX during the 20202024 period. H4 : Ability has an influence on financial reporting fraud in financial sector companies listed on the IDX during the 2020-2024 period. H5 : Ego has an influence on financial reporting fraud in financial sector companies listed on the IDX during the 2020-2024 period. H6 : Collusion has an impact on financial reporting fraud in financial sector companies listed on the IDX during the 2020-2024 period. H7 : Accounting complexity moderates the effect of pressure on financial reporting fraud in financial companies on the IDX during the 2020-2024 period. H8 : Accounting complexity moderates the effect of Opportunity on financial reporting fraud in financial sector companies listed on the IDX in 2020-2024. H9 : Accounting complexity moderates the effect of rationalization on financial reporting fraud in financial sector companies listed on the IDX in 2020-2024. H10 : Accounting complexity moderates the effect of Ability on financial reporting fraud in financial sector companies listed on the IDX in 2020-2024. H11 : Accounting complexity moderates the influence of ego on financial reporting fraud in financial sector companies listed on the IDX in 2020-2024. H12 : Accounting complexity moderates the effect of collusion on financial reporting fraud in financial sector companies listed on the IDX during 2020-2024. IV. RESEARCH METHODS Fraud Hexagon variables (pressure, opportunity, rationalization, ability, ego, and collusion) and financial statement fraud, as well as the moderating role of accounting complexity. The data analyzed comes from available financial information from 2020-2024 which can be accessed using the official IDX website at www.idx.co.id. The study population included all financial sector companies listed on the Indonesia Stock Exchange (IDX) during the 2020–2024 period. The sample selection technique used purposive sampling with the following criteria: Details of Population Data and Research Sample No. Criteria Number of Companies 1. Financial sector companies listed on the Indonesian Stock Exchange in 2020-2024 106 The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies JEFMS, Volume 08 Issue 12 December 2025 www.ijefm.co.in Page 8218 2. Companies that have issued their annual reports for 5 consecutive years in the period 2020-2024 (0) 3. Companies that provide research-related data in annual reports (76) Research sample 30 Observation Period 5 Total (30 x 5) 150 The operational variables and measurements of each variable applied in this study are listed in Table below this: Operational Research Variables and Measurement Variables Measurement Measurement Scale Fraudulent Financial Reporting (FFR) F-Score = Accrual Quality + Financial Performance (Agustina & Pratomo, 2019) Stimulus (STI) ROA = (Achmad et al., 2022). Opportunity (OPP) Effective Monitoring = Skousen et al. (2008) Rationalization (RAT) Dummy variable; companies that changed auditors during the research period were coded 1 and companies that did not change auditors were coded 0. (Indarto & Ghozali., 2016) and (Novitasari & Chariri., 2018) Capability (CAP) A dummy variable where if there is a change in directors the code is 1, conversely if there is no change in directors the code is 0. (Warsidi et al., 2018) Ego (EGO) The number of CEO photos included in the company's annual report. (Yulia Ningsih & Reskino., 2023) Collusion (COL) Audit fee=Ln. (Audit Fee reported) (Jannah et al., 2021) Accounting Complexity (AC) Derivative = (Li et al ., 2025) Data analysis in this study was conducted using a quantitative approach with descriptive statistics and classical assumption tests to ensure model feasibility. Hypothesis testing used panel data regression selected through the Chow , Hausman, and Lagrange Multiplier tests to determine the best model. Furthermore, testing the influence of the Fraud Hexagon variables on financial statement fraud, as well as the moderating role of accounting complexity, was conducted using Moderated Regression Analysis (MRA). The significance of the model was tested using the t-test, F-test, and Adjusted R² value to assess the explanatory power of the model. All analyses were performed with statistical software to obtain valid empirical results. V. RESULTS AND DISCUSSION A. Descriptive Statistics X1 X2 X3 X4 X5 X6 Mean 8.987400 54.95507 0.140000 0.866667 2.853333 21.63621 Median 7.215000 50,000,000 0.000000 1,000,000 3,000,000 21.68134 Maximum 39.30000 100,0000 1,000,000 1,000,000 12,00000 25.38271 Minimum 0.110000 25,00000 0.000000 0.000000 1,000,000 18.90619 Std. Dev. 7.878471 13.66631 0.348149 0.341073 1.615307 1.461705 Source: Data processed ( Eviews )12, 2025 The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies JEFMS, Volume 08 Issue 12 December 2025 www.ijefm.co.in Page 8219 The descriptive analysis table above was used to describe the characteristics of the data before regression testing. The research variables include Pressure (X1), Opportunity (X2), Rationalization (X3), Ability (X4), Ego (X5), Collusion (X6), Financial Reporting Fraud (Y), and Accounting Complexity (Z). The descriptive results show that several variables have high variability, such as X1 and X5, while variables such as X3 and X4 show low variability. This finding indicates that the sample company structure has significant behavioral differentiation so that it is suitable for analysis using panel data. B. Panel Regression Model The Chow test results show a Chi-square probability value of 0.0165, indicating the appropriate model is the Fixed Effect Model (FEM). The Hausman test results also show a probability of 0.0393 < 0.05, indicating that FEM is again the best model. Therefore, panel data testing is conducted using the Fixed Effect Model. C. Classical Assumption Test Source: Processed data ( Eviews ) 12, 2025 Normality The results of the normality test show a Jarque-Bera value of 0.553049 (> 0.05) so that the residuals are normally distributed. D. Heteroscedasticity Dependent Variable: Y Method: Panel Least Squares Date: 11/22/25 Time: 15:19 Sample: 2020 2024 Periods included: 5 Cross-sections included: 30 Total panel (balanced) observations: 150 Variable Coefficient Std. Error t-Statistic Prob. C -3.288806 2.421013 -1.358442 0.1770 X1 0.037298 0.013350 2.793854 0.0061 X2 -0.005308 0.007204 -0.736781 0.4628 X3 0.120777 0.169033 0.714518 0.4764 X4 1.393811 0.177419 7.856058 0.0000 X5 0.014972 0.037162 0.402884 0.6878 X6 0.329280 0.108812 3.026134 0.0031 Source: Processed data ( Eviews ) 12, 2025 Heteroscedasticity From the table above, several variables (X1, X4, X6) show indications of heteroscedasticity, so that further analysis uses robust standard error so that the results remain reliable. 0 2 4 6 8 10 12 14 16 -1.0 -0.5 0.0 0.5 1.0 1.5 Series: Standardized Residuals Sample 2020 2024 Observations 150 Mean -3.22e-17 Median -0.015255 Maximum 1.503082 Minimum -1.207477 Std. Dev. 0.510063 Skewness 0.136202 Kurtosis 2.660391 Jarque-Bera 1.184617 Probability 0.553049 The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies JEFMS, Volume 08 Issue 12 December 2025 www.ijefm.co.in Page 8220 E. Multicollinearity X1 X2 X3 X4 X5 X6 X1 1,000,000 0.256350 -0.087537 0.054043 0.212031 0.374856 X2 0.256350 1,000,000 0.244275 -0.152492 0.178155 -0.045918 X3 -0.087537 0.244275 1,000,000 -0.067824 -0.058716 -0.068420 X4 0.054043 -0.152492 -0.067824 1,000,000 -0.047915 0.060565 X5 0.212031 0.178155 -0.058716 -0.047915 1,000,000 -0.069711 X6 0.374856 -0.045918 -0.068420 0.060565 -0.069711 1,000,000 Source: Processed data ( Eviews ) 12, 2025 the multicollinearity table, a correlation matrix was used to test for multicollinearity between variables X1 through X6. The calculation results show that all correlation values are well below the critical limit of 0.80, which is generally used as an indicator of high multicollinearity. The highest correlation value was only 0.374856 for all variables, while the other variable pairs showed very low correlations, with some even negative, but still within the range that does not indicate multicollinearity. These low correlation values indicate that each independent variable does not have a strong linear relationship with each other. Therefore, it can be concluded that the regression model does not contain multicollinearity, and all independent variables are suitable for use in further regression analysis. F. Fixed Effect Model (FEM) Regression Results Variable Coefficient Std. Error t-Statistic Prob. C -3.961171 2.644780 -1.497732 0.1371 X1 0.037188 0.013811 2.692610 0.0082 X2 -0.005873 0.008153 -0.720373 0.4729 X3 0.119429 0.188835 0.632450 0.5284 X4 1.419030 0.193638 7.328256 0.0000 X5 0.030955 0.041498 0.745932 0.4573 X6 0.353606 0.118048 2.995445 0.0034 Z 0.861639 0.624460 1.379814 0.1705 X1Z 0.004091 0.011684 0.350176 0.7269 X2Z 0.001691 0.002414 0.700560 0.4851 X3Z -0.017931 0.033682 -0.532384 0.5956 X4Z -0.008851 0.082869 -0.106809 0.9151 X5Z -0.016102 0.011311 -1.423636 0.1575 X6Z -0.042033 0.032268 -1.302611 0.1955 Effects Specification Source: Processed data ( Eviews ) 12, 2025 From the table above, it can be concluded that the regression results show that the Pressure variable (X1) has a significant positive effect on financial reporting fraud. Opportunity (X2) has no significant effect. Rationalization (X3) has no significant effect. Ability (X4) has a very significant positive effect. Ego (X5) has no significant effect. Collusion (X6) has a significant positive effect. Accounting Complexity (Z) has no effect. All moderating interaction variables are not significant. This shows that the moderation of accounting complexity is not evident in all relationships between X1–X6 and Y. G. Statistical Test 1) t-test From the results of the t-test, the significant variables are X1, X4, and X6, while X2, X3, X5, and Z are not significant. F-statistic 6.554621 Prob(F-statistic) 0.000000 Source: Processed data ( Eviews ) 12, 2025 The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies JEFMS, Volume 08 Issue 12 December 2025 www.ijefm.co.in Page 8221 2) F test from the table above The F-statistic value of 6.554621 with a p-value of 0.000 shows that all independent variables together have a significant effect on fraudulent financial reporting. R-squared 0.668037 Adjusted R-squared 0.566118 Source: Processed data ( Eviews ) 12, 2025 Coefficient of Determination (R² ) from the table above The adjusted R² value of .566 indicates that 56. 6% of the variation in financial reporting fraud can be explained by the model. The Influence of Pressure on Financial Report Fraud Pressure has been shown to have a significant positive effect on fraud. This finding is in line with the Fraud Hexagon which asserts that pressure, especially financial pressure such as profitability demands (ROA proxy), can drive management to commit fraud to maintain an image of success. These results are consistent with the research of Agusputri & Sofie (2019) and Stevansyah & Suhendah (2023). The Influence of Opportunity on Financial Reporting Fraud Opportunity has not been shown to influence fraud. This shows that in the financial sector, internal control mechanisms are relatively strong so that the existence of opportunities does not directly encourage fraud. These results are in line with Utami et al. (2022), but differ from Aprilia & Furqani (2021). The Effect of Rationalization on Financial Reporting Fraud Rationalization has no significant effect. Auditor change (rationalization proxy) does not directly increase the risk of fraud because the company follows the auditor rotation provisions according to regulations. Strict oversight of the financial industry reduces the role of moral justification for perpetrators. This finding is consistent with Utomo et al. (2019). The Influence of Ability on Financial Reporting Fraud Ability is the most significant variable in the model. Fraud can only be committed by individuals with capacity, experience, and authority. In the financial sector, perpetrators with strategic positions can exploit internal process loopholes to manipulate financial reports. These results support the Fraud Hexagon theory and align with research by Dewi & Yuliati (2022). The Influence of Ego on Financial Report Fraud Ego does not have a significant influence. CEO duality does not increase the likelihood of fraud because financial sector companies have multiple layers of oversight. This finding is in line with Indriani & Rakhman (2021). The Effect of Collusion on Financial Report Fraud Collusion has a significant impact on fraud. Collusion between individuals or external parties is an important factor in the occurrence of fraud because it allows coordination to hide irregularities. This finding supports Aviantara (2021). THE MODERATING ROLE OF ACCOUNTING COMPLEXITY Accounting complexity does not moderate the relationship between X1–X6 and Y. The results show that all interaction variables are not significant because financial sector regulations are very strict , so that complexity does not become a loophole for fraud. Multi-level supervision internal audit, external audit, OJK closes opportunities exploiting complexity, Fraudulent behavior is more influenced by human factors, ability and collusion. compared to the technical aspects of recording. These results support Amara & Trabelsi (2019) who stated that strict regulations can eliminate the moderating role of accounting complexity. Overall, these findings indicate that fraud in the financial sector is mostly triggered by pressure, ability, and collusion , not by the complexity of the accounting system. VI. CONCLUSIONS The results of this study indicate that financial reporting fraud in financial sector companies in Indonesia is substantially influenced by behavioral factors within the Fraud Hexagon framework, specifically pressure, capability, and collusion, which have been shown to significantly influence the probability of fraud. These findings suggest that financial pressure, management's capacity to exploit system loopholes, and cooperation among actors play a significant role in encouraging the practice of financial reporting manipulation. Conversely, the variables of opportunity, rationalization, and ego do not show a significant influence, reflecting that financial industry regulations, internal control systems, and strict corporate governance have limited management's room to commit irregularities based on these factors. Furthermore, accounting complexity has not been shown to act as a moderating variable, so complexity in the reporting system neither strengthens nor weakens the relationship between the Fraud Hexagon elements and financial reporting fraud. This condition confirms that regulatory oversight and strict The Effect of Fraud Hexagon on Fraudulent Financial Reporting with Accounting Complexity as a Moderating Variable in Financial Sector Companies JEFMS, Volume 08 Issue 12 December 2025 www.ijefm.co.in Page 8222 reporting standards in the financial sector are able to reduce the risk of abuse of accounting complexity. Thus, this study confirms that the main determinants of fraud are more behavioral and collaborative, rather than technical accounting, so that fraud prevention efforts need to be directed at strengthening management integrity and mitigating potential collusion. REFERENCES 1) Diany, &Wahjoe. (2024). 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