In e na ional Jou nal o Cu en Science Resea ch and Re iew
ISSN: 2581-8341
Volume 08 Issue 11 No embe 2025
DOI: 10.47191/ijcs /V8-i11-26, Impac Fac o : 8.048
IJCSRR @ 2025
www.ijcs .o g
5693 *Co esponding Au ho : Sye li No i a Volume 08 Issue 11 No embe 2025
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The In luence o F aud Hep agon, Audi Repo Lag, and Whis leblowing
Sys em on Financial S a emen F aud wi h Good Co po a e Go e nance as
a Mode a ing Va iable: E idence om Indonesian Manu ac u ing
Companies
Sye li No i a1, T i Widyas u i2, Da mansyah3
1 Doc o al S uden – Facul y o Economics & Business – Pancasila Uni e si y – Jaka a - INDONESIA
2 P o esso , Accoun ing Depa men - Uni e si y o Bhayangka a – Jaka a Raya - INDONESIA
3 Associa e P o esso , Doc o al P og am, Facul y o Economics & Business – Pancasila Uni e si y – Jaka a - INDONESIA
ABSTRACT: This s udy examines how he F aud Hep agon, Audi Repo Lag, and Whis leblowing Sys em in luence he incidence
o inancial s a emen aud in Indonesian manu ac u ing i ms, wi h Good Co po a e Go e nance (GCG) es ed as a mode a ing
ac o . Using panel da a om 100 companies lis ed on he Indonesian S ock Exchange be ween 2015 and 2024, he analysis applies
Pa ial Leas Squa es–S uc u al Equa ion Modeling (PLS-SEM) o e alua e bo h di ec and in e ac ion e ec s. The F aud
Hep agon—comp ising p essu e, oppo uni y, a ionaliza ion, capabili y, a ogance, collusion, and g eed—demons a es a
signi ican posi i e associa ion wi h audulen inancial epo ing, indica ing i s ele ance as a mul idimensional p edic o o
une hical beha io . Audi Repo Lag shows a posi i e bu insigni ican ela ionship wi h aud, sugges ing ha epo ing delays
alone do no eliably indica e manipula ion. Con e sely, an e ec i e Whis leblowing Sys em signi ican ly educes he likelihood o
miss a emen s. The mode a ing analysis e eals ha GCG s eng hens he e ec s o he F aud Hep agon and he Whis leblowing
Sys em bu does no al e he in luence o Audi Repo Lag. These indings highligh he impo ance o beha io al, p ocedu al, and
go e nance mechanisms in aud p e en ion. The s udy con ibu es heo e ical alida ion o he F aud Hep agon in an eme ging-
ma ke con ex and p o ides p ac ical guidance o imp o ing o e sigh , anspa ency, and e hical accoun abili y in co po a e
epo ing.
KEYWORDS: F aud Hep agon, Audi Repo Lag, Whis leblowing Sys em, F audulen Financial S a emen , E ec i e co po a e
go e nance
1. INTRODUCTION
Financial s a emen aud con inues o gene a e se ious conce ns o egula o s, in es o s, and he b oade co po a e communi y
because i e odes ma ke con idence, dis up s he c edibili y o inancial epo ing, and h ea ens economic s abili y. In Indonesia, a
se ies o high-p o ile scandals—including he cases in ol ing PT Ga uda Indonesia (2018), PT Jiwas aya (2018), and PT Indo a ma
(2024)—illus a e he pe sis en ulne abili ies wi hin he coun y’s go e nance and o e sigh sys ems. These cases e eal ha
managemen oppo unism, weak in e nal checks, and inadequa e e hical cul u es can easily unde mine egula o y sa egua ds.
F audulen inancial epo ing, de ined as he delibe a e p esen a ion o misleading accoun ing in o ma ion in ended o dis o a i m’s
pe o mance, emains a p e alen issue despi e con inuous e o ms (Rezaee, 2005; Ros ami & Rezaei, 2022). Al hough he OJK and
Indonesian S ock Exchange ha e in ensi ied disclosu e ules and moni o ing mechanisms, nume ous s udies conclude ha o mal
compliance alone does no su icien ly p e en manipula ion, pa icula ly when manage ial incen i es con lic wi h s akeholde
in e es s (Akba , 2017; Ch is ian e al., 2019; Handoko e al., 2023; Djami & Mu an o, 2024).
Theo e ical a emp s o explain audulen beha io ha e e ol ed o e se e al decades. T adi ional models—such as he F aud
T iangle de eloped by C essey (1953), he F aud Diamond p oposed by Wol e and He manson (2004), and he F aud Pen agon
in oduced by Ho wa h (2011)—ha e long se ed as ounda ional amewo ks o unde s anding why indi iduals engage in une hical
inancial p ac ices. Howe e , hese amewo ks concen a e la gely on pe sonal mo i a ions and s uc u al weaknesses, and hey end
o o e look b oade o ganiza ional no ms, cul u al alues, and in e pe sonal dynamics ha o en shape misconduc in eme ging
ma ke s. To add ess hese limi a ions, Vousinas (2019) in oduced he F aud Hep agon model, which inco po a es se en dimensions
In e na ional Jou nal o Cu en Science Resea ch and Re iew
ISSN: 2581-8341
Volume 08 Issue 11 No embe 2025
DOI: 10.47191/ijcs /V8-i11-26, Impac Fac o : 8.048
IJCSRR @ 2025
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5694 *Co esponding Au ho : Sye li No i a Volume 08 Issue 11 No embe 2025
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belie ed o d i e audulen beha io : p essu e, oppo uni y, a ionaliza ion, capabili y, a ogance, collusion, and g eed. This
expanded amewo k acknowledges ha aud is no me ely an indi idual ac bu a complex in e ac ion be ween psychological d i e s
and ins i u ional weaknesses. Al hough he model o e s a mo e comp ehensi e pe spec i e, empi ical e idence suppo ing i s use—
pa icula ly wi hin Indonesia— emains ela i ely limi ed, as much o he exis ing esea ch s ill elies on he F aud Pen agon o ea lie
models (Ap iliana & Agus ina, 2017; As u i e al., 2019; Puspi ha & Yasa, 2018; Rachman e al., 2023).
Beyond beha io al and mo al conside a ions, se e al s uc u al indica o s unc ion as ea ly wa ning signs o po en ial mis epo ing.
One o hese is Audi Repo Lag (ARL), which e lec s he ime elapsed be ween he close o a iscal yea and he issuance o he
audi o ’s opinion. ARL is commonly in e p e ed as a measu e o audi e iciency, ye p olonged delays may also signal deepe issues
such as audi di icul ies, in e nal dis up ions, o esis ance om managemen ega ding he disclosu e o sensi i e in o ma ion
(Gin ing & Hidaya , 2019; Widha ma & Susilowa i, 2020). Longe audi p ocesses ha e been linked o heigh ened aud isk, as
audi o s may equi e addi ional ime o e alua e i egula i ies o o e come ba ie s c ea ed by managemen (Abed e al., 2020;
Fakh akh & Ja boui, 2022). Simila ly, o ganiza ional mechanisms such as Whis leblowing Sys ems (WBS) play an impo an ole in
p omo ing in eg i y and anspa ency. In heo y, WBS enables employees o epo une hical p ac ices con iden ially, p o iding
o ganiza ions wi h a on line mechanism o de ec ing ea ly signs o aud (Kap ein, 2011; Sukmadilaga e al., 2022). Howe e , in
Indonesia, whis leblowing emains cons ained by hie a chical wo k cul u es, limi ed psychological sa e y, and ea o e alia ion,
which o en educe he e ec i eness o epo ing channels (Pu i & Handayani, 2024; Wa dah e al., 2022). As a esul , he p o ec i e
unc ion o WBS can only be ealized when o ganiza ions cul i a e us , e hical leade ship, and c edible ollow-up p ocedu es.
Wi hin his landscape, Good Co po a e Go e nance (GCG) eme ges as a c ucial mode a ing o ce ha s eng hens he e ec i eness
o bo h beha io al and s uc u al aud-p e en ion mechanisms. GCG emphasizes anspa ency, accoun abili y, independence,
ai ness, and esponsibili y, o e ing a amewo k h ough which companies can align manage ial ac ions wi h s akeholde
expec a ions and educe in o ma ion asymme y (OECD, 2015). Nume ous empi ical s udies sugges ha when go e nance
mechanisms such as independen boa ds, ac i e audi commi ees, and s ong in e nal con ols a e implemen ed consis en ly, hey can
e ec i ely de e manipula ion, enhance moni o ing, and ein o ce e hical beha io (Hasnan e al., 2013; Nasi e al., 2019; Vel e,
2023). Howe e , he p ac ical applica ion o GCG in Indonesia emains une en. In many i ms, go e nance s uc u es a e adop ed
symbolically o sa is y egula o y equi emen s a he han embedded as pa o a subs an i e e hical cul u e. This gap be ween policy
and p ac ice c ea es oppo uni ies o audulen beha io o pe sis .
Exis ing li e a u e on aud in Indonesia has la gely examined beha io al ac o s, audi dynamics, o go e nance a iables
independen ly. Only a limi ed numbe o s udies in eg a e hese componen s wi hin a comp ehensi e concep ual amewo k.
Fu he mo e, empi ical alida ion o he F aud Hep agon—especially when combined wi h go e nance as a mode a ing a iable—
emains insu icien . The e o e, his s udy seeks o add ess hese gaps by examining how he F aud Hep agon, Audi Repo Lag, and
Whis leblowing Sys em in luence audulen inancial epo ing, while assessing whe he Good Co po a e Go e nance s eng hens
o weakens hese ela ionships in manu ac u ing i ms lis ed on he Indonesian S ock Exchange om 2015 o 2024. By analyzing
hese in e connec ed elemen s simul aneously, his esea ch con ibu es o a deepe unde s anding o aud dynamics in eme ging
ma ke s and p o ides ac ionable ecommenda ions o enhance anspa ency, o e sigh , and e hical accoun abili y in co po a e
epo ing.
This s udy aims o analyze he in luence o F aud Hep agon, Audi Repo Lag, and Whis leblowing Sys em on Financial S a emen
F aud wi h E ec i e co po a e go e nance as a mode a ing a iable, ocusing on manu ac u ing companies lis ed on he Indonesian
con ex S ock Exchange (2015–2024). By empi ically alida ing he F aud Hep agon model and in eg a ing go e nance as a
mode a ing mechanism, his esea ch no only ad ances aud heo y bu also p o ides p ac ical solu ions o enhancing in eg i y and
c edibili y in co po a e epo ing.
II. LITERATURE REVIEW AND HYPOTHESIS DEVELOPMENT
Theo e ical F amewo k
The concep ual basis o his s udy is g ounded p ima ily in Agency Theo y, which explains how con lic s a ise when he in e es s o
owne s and manage s di e ge due o unequal access o in o ma ion. Jensen and Meckling (1976) a gue ha manage s end o pu sue
pe sonal bene i when hey possess disc e ion o e co po a e esou ces, especially in ci cums ances whe e moni o ing mechanisms
a e weak o cos ly. This imbalance o en leads o mo al haza d, manipula ion o inancial esul s, and oppo unis ic beha io , all o
In e na ional Jou nal o Cu en Science Resea ch and Re iew
ISSN: 2581-8341
Volume 08 Issue 11 No embe 2025
DOI: 10.47191/ijcs /V8-i11-26, Impac Fac o : 8.048
IJCSRR @ 2025
www.ijcs .o g
5695 *Co esponding Au ho : Sye li No i a Volume 08 Issue 11 No embe 2025
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which con ibu e o he eme gence o inancial epo ing aud. When manage ial incen i es a e ied o sho - e m inancial ou comes
o when o e sigh s uc u es lack independence, he likelihood o mis ep esen a ion becomes g ea e (Eisenha d , 1989; Sco , 2015).
These challenges a e pa icula ly p onounced in Indonesia, whe e owne ship is equen ly concen a ed and o ganiza ional hie a chies
end o cen alize au ho i y. As a esul , agency con lic s can escala e in o go e nance ailu es and inc eased aud isk (Si ega &
U ama, 2008; Kusumawa i & Rahayu, 2018). S eng hening in e nal go e nance— h ough mechanisms such as boa d independence,
igo ous audi ing, and anspa en disclosu es—is he e o e essen ial o mi iga ing sel -se ing beha io .
Complemen ing his pe spec i e, F aud Theo y p o ides insigh in o he psychological and si ua ional condi ions ha mo i a e
indi iduals o engage in dishones inancial p ac ices. The ea lies o mal model, C essey’s (1953) F aud T iangle, highligh ed h ee
co e d i e s—p essu e, oppo uni y, and a ionaliza ion. As esea ch e ol ed, schola s expanded his iew by in eg a ing capabili y
(Wol e & He manson, 2004) and a ogance (Ho wa h, 2011), acknowledging ha aud o en a ises om mo e complex
o ganiza ional and beha io al in luences. Vousinas (2019) la e in oduced he F aud Hep agon, u he en iching he amewo k by
adding collusion and g eed— wo elemen s ha cap u e mo al decay and une hical alliances ha may o m wi hin co po a e s uc u es.
This heo e ical p og ession illus a es ha audulen beha io is shaped by a combina ion o psychological jus i ica ion, si ua ional
p essu e, in e pe sonal coope a ion, and o ganiza ional design. Go e nance Theo y and S akeholde Theo y con ibu e addi ional
dep h by emphasizing ha i ms ha e e hical obliga ions no only o sha eholde s bu also o egula o s, employees, and he public
(F eeman, 1984; T icke , 2019). F om his s andpoin , e ec i e go e nance ope a es as bo h a moni o ing sys em and a mo al
compass, guiding manage ial beha io owa d accoun abili y and os e ing an en i onmen ha discou ages aud. Toge he , hese
heo ies es ablish he ounda ion o examining how beha io al mo i a ions, p ocedu al ac o s, and go e nance s uc u es
collec i ely in luence audulen inancial ou comes in Indonesian co po a ions.
F aud Hep agon and Financial S a emen F aud
The F aud Hep agon Model p oposed by Vousinas (2019) p o ides a mul idimensional amewo k o unde s anding why indi iduals
and g oups commi inancial aud. Each o i s se en componen s ep esen s a dis inc ye in e connec ed sou ce o une hical beha io .
Fo ins ance, p essu e o en s ems om unme pe o mance a ge s o inancial s ain, pushing manage s o manipula e esul s.
Oppo uni y e lec s gaps in in e nal con ols o weak go e nance s uc u es ha c ea e a enues o misconduc . Ra ionaliza ion
ep esen s he men al p ocesses indi iduals use o jus i y dishones ac s, while capabili y deno es he echnical skill, au ho i y, o
access needed o ca y ou manipula ion (Wol e & He manson, 2004; Ho wa h, 2011). The addi ional dimensions—a ogance,
collusion, and g eed—in oduce mo al and ela ional elemen s a ely cap u ed in ea lie models. A ogance e lec s o e con idence
and a belie ha one will no ace consequences, collusion highligh s he coope a i e na u e o many aud schemes, and g eed
unde sco es excessi e pe sonal ambi ion (Azizah & Reskino, 2023).
Empi ical e idence sugges s ha hese elemen s play a signi ican ole in shaping audulen beha io in eme ging ma ke s. S udies
conduc ed in Indonesia ha e ound ha ac o s such as a ogance and g eed can subs an ially inc ease he likelihood o epo ing
manipula ion (P ihan o, 2021). O he schola s ha e documen ed how p essu e, oppo uni y, and a ionaliza ion c ea e condi ions
conduci e o aud, especially in i ms acing in ense compe i ion o in e nal con ol de iciencies (Ti ani & Ma uah, 2015;
Fa hmaning um & Angga ani, 2021). The cul u al con ex o Indonesia—cha ac e ized by collec i is no ms and hie a chical
o ganiza ional s uc u es—may also ampli y collusi e beha io o a ionaliza ions ied o g oup loyal y (Kusumawa i & Rahayu,
2018). Gi en hese insigh s, he F aud Hep agon se es as a obus heo e ical basis o examining aud wi hin Indonesian
manu ac u ing i ms.
H1: F aud Hep agon has a signi ican posi i e e ec on audulen inancial s a emen s.
Audi Repo Lag and Financial S a emen F aud
Audi Repo Lag (ARL) is widely used as an indica o o audi e iciency and can also signal unde lying issues ha may heigh en
he isk o aud. ARL measu es he numbe o days be ween he iscal yea -end and he issuance o he audi o ’s epo . While longe
audi pe iods may a ise om legi ima e challenges such as ope a ional complexi y o la ge i m size, delays can also e lec audi o
suspicion, incomple e in o ma ion, o esis ance om managemen . When audi o s encoun e po en ial i egula i ies o ace
di icul ies ob aining suppo ing e idence, hey may equi e mo e ime o o m a eliable opinion, causing ex ended lags (Gin ing &
Hidaya , 2019; Su yan o, 2016). Se e al s udies sugges ha p olonged ARL is associa ed wi h highe aud likelihood, as audi o s
o en unco e inconsis encies o ques ionable ansac ions du ing ex ended e iews (Widha ma & Susilowa i, 2020; Abed e al.,
2020).
In e na ional Jou nal o Cu en Science Resea ch and Re iew
ISSN: 2581-8341
Volume 08 Issue 11 No embe 2025
DOI: 10.47191/ijcs /V8-i11-26, Impac Fac o : 8.048
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Ne e heless, ARL is no always a de ini i e indica o o aud; i s meaning depends la gely on he o ganiza ional and go e nance
con ex . S ong audi commi ees, e ec i e in e nal con ol sys ems, and anspa en managemen p ac ices ypically educe epo ing
delays by acili a ing audi o access and o e sigh (Yuso e al., 2015). Con e sely, poo go e nance may allow manage s o in e e e
wi h he audi p ocess, wi hholding in o ma ion o modi ying da a o in luence ou comes. In en i onmen s whe e go e nance
en o cemen is weak, ARL may he e o e unc ion as an indi ec wa ning signal o possible manipula ion.
H2: Audi Repo Lag has a posi i e e ec on audulen inancial s a emen s.
Whis leblowing Sys em and Financial S a emen F aud
Whis leblowing Sys ems (WBS) ep esen a c i ical mechanism o de ec ing and p e en ing aud by enabling employees and
s akeholde s o epo w ongdoing con iden ially. An e ec i e WBS educes in o ma ion asymme y by allowing inside s—o en
hose closes o he misconduc — o oice conce ns wi hou ea o e alia ion (Kap ein, 2011). O ganiza ions ha es ablish secu e
epo ing channels, o e anonymi y, and p o ide imely ollow-up p ocedu es end o p e en une hical beha io mo e e ec i ely
han hose ha ea whis leblowing me ely as symbolic compliance (Achmad e al., 2022; Pu i & Handayani, 2024). WBS aligns
wi h bo h S akeholde Theo y and Agency Theo y by c ea ing addi ional laye s o o e sigh ha limi manage ial disc e ion and os e
a cul u e o anspa ency.
Resea che s ha e ound ha i ms wi h ac i e WBS implemen a ions expe ience ewe misconduc inciden s, as employees eel mo e
empowe ed o epo une hical beha io (Sudjono, 2023). In Indonesia, howe e , he e ec i eness o WBS is o en cons ained by
cul u al no ms o de e ence o au ho i y, conce ns abou ca ee epe cussions, and unce ain y abou managemen ’s willingness o ac
(Wa dah e al., 2022). When managemen ails o espond adequa ely o epo s, employees become eluc an o use he sys em,
weakening i s de e en unc ion. Ne e heless, when p ope ly implemen ed, WBS has been shown o lowe he likelihood o
audulen epo ing by imp o ing o e sigh and e hical esponsi eness (Se yawa i e al., 2020).
H3: Whis leblowing Sys em has a nega i e e ec on audulen inancial s a emen s.
Good Co po a e Go e nance as a Mode a ing Va iable
Good Co po a e Go e nance (GCG) se es as a undamen al mechanism ha aligns he in e es s o managemen and sha eholde s,
ensu ing accoun abili y, anspa ency, ai ness, and esponsibili y in co po a e decision-making (OECD, 2015; KNKG, 2006). GCG
p o ides a sys em o checks and balances ha minimizes agency p oblems and cu bs manage ial oppo unism. In heo y, e ec i e
go e nance s uc u es, such as independen boa ds, audi commi ees, and anspa en epo ing p ac ices, educe he likelihood o
audulen ac i i ies by cons aining manage ial disc e ion (T icke , 2019). Acco ding o Agency Theo y (Jensen & Meckling, 1976),
manage s end o p io i ize pe sonal in e es s when o e sigh mechanisms a e weak, leading o une hical decisions including inancial
mis epo ing. Go e nance mechanisms he e o e play a p e en i e ole by moni o ing beha io and os e ing e hical co po a e cul u e.
Empi ical e idence om Indonesia suppo s his heo e ical link, e ealing ha companies wi h s ong GCG p ac ices, including high
boa d independence and ac i e audi commi ees, exhibi signi ican ly lowe aud isk (Kusumawa i & Rahayu, 2018). In his con ex ,
GCG is expec ed o mode a e he e ec o F aud Hep agon elemen s, pa icula ly a ogance, oppo uni y, and g eed—by enhancing
in e nal con ol and e hical awa eness wi hin i ms.
H4: Good Co po a e Go e nance mode a es he e ec o F aud Hep agon on audulen inancial s a emen s.
The mode a ing e ec o GCG is also ele an in he ela ionship be ween Audi Repo Lag (ARL) and audulen inancial
s a emen s. A longe audi lag may signal manage ial esis ance, audi complexi y, o in e nal ine iciency (Blankley e al., 2014;
Widha ma & Susilowa i, 2020). Howe e , i ms wi h s ong go e nance end o en o ce imely and anspa en epo ing s anda ds,
hus educing audi delay and i s associa ed isks (Yuso e al., 2015). The audi commi ee, as a co e GCG componen , plays an
ins umen al ole in ensu ing ha ex e nal audi o s main ain independence and deli e epo s p omp ly (Fodio e al., 2013). Likewise,
boa d independence enhances audi o accoun abili y by minimizing undue in luence om managemen (A el e al., 2012). S udies by
Si ega and U ama (2008) and Alqa amin (2018) show ha e ec i e go e nance mechanisms sho en ARL and imp o e he eliabili y
o audi ou comes, he eby lowe ing he po en ial o aud. In con as , weak go e nance can exace ba e delays, as manage s exploi
he lack o o e sigh o manipula e audi p ocesses. Thus, GCG ac s as a sa egua d ha mi iga es he posi i e associa ion be ween
audi delays and audulen epo ing.
H5: Good Co po a e Go e nance mode a es he e ec o Audi Repo Lag on audulen inancial s a emen s.
In e na ional Jou nal o Cu en Science Resea ch and Re iew
ISSN: 2581-8341
Volume 08 Issue 11 No embe 2025
DOI: 10.47191/ijcs /V8-i11-26, Impac Fac o : 8.048
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Fu he mo e, GCG s eng hens he ole o he Whis leblowing Sys em (WBS) by os e ing a suppo i e e hical clima e and ensu ing
managemen esponsi eness o epo ed misconduc (Kap ein, 2011; La an e al., 2019). A unc ional go e nance s uc u e gua an ees
ha whis leblowe s a e p o ec ed om e alia ion and ha epo s a e p ocessed impa ially. Go e nance p inciples such as
anspa ency and accoun abili y a e in eg al o ans o ming whis leblowing om a symbolic policy in o an e ec i e aud p e en ion
ool. In Indonesia, empi ical indings indica e ha WBS e ec i eness signi ican ly inc eases when i ms demons a e genuine boa d
commi men o in eg i y and e hics (Se yawa i e al., 2020; Sudjono, 2023). Con e sely, in o ganiza ions wi h weak go e nance,
whis leblowing mechanisms o en become ine ec i e o igno ed, allowing audulen ac s o pe sis . The e o e, GCG enhances he
de e en unc ion o WBS by ins i u ionalizing e hical beha io and ollow-up p ocedu es a he manage ial and boa d le els
(Kusumawa i & Rahayu, 2018; T icke , 2019). Acco dingly, he s udy p oposes ha e ec i e co po a e go e nance ampli ies he
nega i e associa ion be ween whis leblowing sys ems and inancial s a emen aud.
H6: Good Co po a e Go e nance mode a es he e ec o Whis leblowing Sys em on audulen inancial s a emen s.
RESEARCH METHOD
Resea ch Design
This s udy adop s a quan i a i e, explana o y esea ch design o analyze causal ela ionships among he F aud Hep agon, Audi
Repo Lag, Whis leblowing Sys em, and audulen inancial epo ing, wi h Good Co po a e Go e nance (GCG) posi ioned as a
mode a ing a iable. The explana o y app oach is app op ia e because he objec i e is no only o desc ibe bu also o s a is ically es
he in luence and in e ac ion e ec s o hese cons uc s. Quan i a i e esea ch is widely applied in go e nance and aud s udies, as i
enables esea che s o examine measu able indica o s, iden i y pa e ns, and gene alize indings ac oss la ge popula ions (C eswell
& C eswell, 2018; Hai e al., 2021). The s udy aligns wi h a posi i is pa adigm ha emphasizes empi ical alida ion and objec i e
measu emen , ensu ing ha conclusions a e g ounded in obse able e idence. The esea ch ocuses on manu ac u ing companies
lis ed on he Indonesian S ock Exchange (IDX) om 2015 o 2024, a sec o equen ly associa ed wi h inancial epo ing i egula i ies
due o i s complex ope a ional en i onmen in ol ing in en o y alua ion, p oduc ion cos ing, and e enue ecogni ion (Rezaee,
2005; Kusumawa i & Rahayu, 2018). This ex ended pe iod o obse a ion enables he iden i ica ion o empo al ends and p o ides
a obus ounda ion o s a is ical es ing.
Da a Sou ces and Sampling
The s udy elies en i ely on seconda y da a de i ed om audi ed annual epo s, co po a e go e nance disclosu es, whis leblowing
documen a ion, and i m p o iles published by IDX-lis ed manu ac u ing companies. These da a sou ces p o ide eliable, e i iable
in o ma ion ha suppo s quan i a i e measu emen and analysis. To ensu e consis ency and compa abili y, i ms we e selec ed based
on h ee c i e ia: con inuous lis ing on he IDX h oughou 2015–2024, comple e a ailabili y o inancial and audi da a, and accessible
co po a e go e nance and whis leblowing disclosu es. Companies ailing o mee hese c i e ia—such as hose delis ed o lacking
equi ed disclosu es—we e excluded om he sample. The da a collec ion p ocess employed documen a ion echniques, whe e
in o ma ion was sys ema ically ex ac ed om publicly a ailable documen s and e i ied h ough c oss- e e encing when necessa y
(Seka an & Bougie, 2016). The use o pu posi e sampling was in en ional because he objec i e was no andom ep esen a ion bu
selec ion o i ms ha p o ide comple e and eliable in o ma ion o analy ical pu poses (Saunde s e al., 2018). Gi en he egula o y
equi emen s in he manu ac u ing sec o , he selec ed companies o e a ich da ase o analyzing inancial epo ing beha io and
go e nance dynamics o e ime.
Va iables and Measu emen s
The dependen a iable, audulen inancial epo ing, is measu ed using he Beneish M-Sco e, a widely ecognized model o
de ec ing ea nings manipula ion based on eigh inancial a ios indica ing abno mal pa e ns in e enue, expenses, and asse usage
(Beneish, 1999). Highe M-sco es signal a g ea e likelihood o manipula ion. The independen a iables a e ope a ionalized as
ollows. Fi s , he F aud Hep agon encompasses se en dimensions—p essu e, oppo uni y, a ionaliza ion, capabili y, a ogance,
collusion, and g eed—cap u ed h ough inancial, go e nance, and ope a ional indica o s adap ed om Vousinas (2019). Each
dimension e lec s a speci ic beha io al o o ganiza ional condi ion associa ed wi h aud isk. Second, Audi Repo Lag is de ined
as he numbe o days be ween he company’s iscal yea -end and he audi o ’s opinion da e, e lec ing imeliness and po en ial
p ocedu al challenges (Fakh akh & Ja boui, 2022; Widha ma & Susilowa i, 2020). Thi d, he Whis leblowing Sys em (WBS) is
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measu ed using a composi e index ha e alua es he a ailabili y o epo ing channels, con iden iali y assu ances, and managemen
esponsi eness o epo ed cases (Kap ein, 2011; Se yawa i e al., 2020).
The mode a ing a iable, Good Co po a e Go e nance, is p oxied h ough indica o s equi ed unde Indonesian egula ions—
pa icula ly he p opo ion o independen commissione s and he ac i i y le el o audi commi ees, as s ipula ed in OJK Regula ion
No. 55/POJK.04/2015. These indica o s a e widely used in p io go e nance esea ch and e lec he i m’s capaci y o moni o
ope a ions, ensu e epo ing in eg i y, and en o ce accoun abili y (Kusumawa i & Rahayu, 2018; T icke , 2019). Toge he , hese
measu emen s ensu e comp ehensi e ep esen a ion o he concep ual a iables and acili a e eliable es ing o he s udy’s
hypo heses.
Resea ch Model and Ope a ional F amewo k
The ope a ional model o his s udy in eg a es beha io al, p ocedu al, and go e nance pe spec i es o explain inancial s a emen
aud. The F aud Hep agon ep esen s in e nal beha io al p essu es, while Audi Repo Lag and he Whis leblowing Sys em e lec
p ocedu al and e hical mechanisms in luencing epo ing p ac ices. Good Co po a e Go e nance mode a es hese ela ionships by
s eng hening o e sigh and enhancing o ganiza ional accoun abili y. The concep ual model is ancho ed in Agency Theo y, F aud
Theo y, and Go e nance Theo y, collec i ely cap u ing he mul i ace ed na u e o aud— anging om indi idual mo i a ions o
sys emic o e sigh ailu es (Jensen & Meckling, 1976; Rezaee, 2005; F eeman, 1984). By in e linking hese heo e ical lenses, he
s udy add esses gaps in p e ious li e a u e, whe e aud de e minan s we e o en examined in isola ion a he han h ough an
in eg a ed amewo k. The model hus p o ides a holis ic s uc u e o unde s anding how beha io al incen i es and go e nance
sys ems in e ac wi hin he Indonesian co po a e en i onmen .
Da a Analysis Techniques
Da a analysis was ca ied ou using Sma PLS 3.27, applying he Pa ial Leas Squa es S uc u al Equa ion Modeling (PLS-SEM)
me hod. PLS-SEM is pa icula ly sui able o his esea ch because i accommoda es complex models, suppo s la en a iables wi h
mul iple indica o s, and pe o ms well e en wi h non-no mally dis ibu ed da a (Hai e al., 2021). The analy ical p ocedu e consis s
o wo majo s ages: e alua ion o he measu emen model (ou e model) and e alua ion o he s uc u al model (inne model). The
ou e model assessmen examines indica o loadings, con e gen alidi y (using AVE), disc iminan alidi y (using Fo nell–La cke
c i e ia), and in e nal consis ency eliabili y ( ia Composi e Reliabili y and C onbach’s Alpha). Only cons uc s ha mee
ecommended h esholds p oceed o s uc u al analysis.
In he inne model e alua ion, pa h coe icien s, coe icien o de e mina ion (R²), e ec sizes ( ²), and p edic i e ele ance (Q²) a e
assessed o de e mine he s eng h and signi icance o he hypo hesized ela ionships. P edic i e ele ance is e alua ed h ough a
blind olding p ocedu e, and hypo heses a e es ed using boo s apping wi h 5,000 esamples o ob ain obus -s a is ics and p- alues
(Hai e al., 2021). Mode a ion analysis is conduc ed using he p oduc -indica o app oach, which es s whe he he in e ac ion
be ween GCG and each independen a iable signi ican ly in luences audulen inancial epo ing. E hical conside a ions we e
upheld by elying exclusi ely on publicly a ailable da a and using i solely o academic pu poses (Seka an & Bougie, 2016).
III. RESULTS AND DISCUSSION
Desc ip i e Findings
The desc ip i e analysis using he Beneish M-Sco e e eals ha Indonesian con ex n manu ac u ing i ms exhibi ed mode a e ye
luc ua ing endencies owa d inancial s a emen manipula ion be ween 2015 and 2024. A he s a o he pe iod, nea ly wo- i hs
o he i ms analyzed exceeded he Beneish h eshold o –2.22, signaling a ela i ely high p obabili y o miss a emen . Howe e ,
s eady imp o emen occu ed om 2016 o 2019, when aud indica ions declined sha ply and non-manipula i e i ms domina ed he
sample. A sha p e e sal occu ed in 2020, when i ms classi ied as likely manipula o s su ged o nea ly 70 pe cen o he sample,
coinciding wi h he COVID-19 pandemic and he accompanying economic down u n. The pandemic shock heigh ened liquidi y
p essu es and in es o expec a ions, mo i a ing manage s o a ionalize agg essi e ea nings managemen —a beha io al esponse
consis en wi h he F aud Hep agon model’s dimensions o p essu e, oppo uni y, and a ionaliza ion (Vousinas, 2019). A e 2021,
audulen indica ions g adually declined, eaching hei lowes le el by 2024, al hough luc ua ions pe sis ed among ce ain
subsec o s. The o e all pa e n demons a es ha aud isk in Indonesian con ex ’s manu ac u ing indus y is cyclical and con ex -
dependen , imp o ing du ing s able mac oeconomic pe iods bu de e io a ing when ex e nal shocks in ensi y manage ial s ess.
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Assessmen o S uc u al Model
The Assessmen o he S uc u al Model – Algo i hm ma ks he ini ial and essen ial phase o he Pa ial Leas Squa es S uc u al
Equa ion Modeling (PLS-SEM) p ocess conduc ed h ough Sma PLS. This s age is undamen al because i es ima es he ini ial
pa ame e s ha de e mine how e ec i ely he p oposed model cap u es and explains he ela ionships be ween cons uc s. Du ing
his s ep, se e al c i ical componen s a e gene a ed, including ou e loadings, pa h coe icien s, and la en a iable sco es.
Figu e 1: The Assessmen o S uc u al Model – Algo i hm
Ou e loadings ep esen he deg ee o co ela ion be ween each obse ed indica o and i s co esponding la en cons uc , e lec ing
how well he indica o s measu e he unde lying a iable. Pa h coe icien s, on he o he hand, indica e bo h he s eng h and di ec ion
o he causal links among la en cons uc s wi hin he model. La en a iable sco es a e nume ical ep esen a ions o unobse ed
cons uc s ha se e as inpu o la e s ages, pa icula ly hypo hesis es ing and boo s apping p ocedu es. In his phase, Sma PLS
u ilizes an i e a i e es ima ion algo i hm ha aims o maximize he explained a iance o endogenous cons uc s—aligning wi h he
co e objec i e o PLS-SEM, which emphasizes p edic i e accu acy and model obus ness.
E alua ing cons uc alidi y and eliabili y is a i al s ep be o e p oceeding o hypo hesis es ing, as i ensu es ha each la en
cons uc is measu ed accu a ely by i s obse ed indica o s. Cons uc alidi y includes bo h con e gen and disc iminan alidi y.
Con e gen alidi y is ypically assessed using h ee main c i e ia: ac o loadings, A e age Va iance Ex ac ed (AVE), and
Composi e Reliabili y (CR). Acco ding o Hai e al. (2021), loading alues abo e 0.70 indica e ha he indica o s ongly ep esen s
i s cons uc , while an AVE exceeding 0.50 shows ha mo e han hal o he a iance in he indica o s is explained by he la en
cons uc . A CR alue g ea e han 0.70 signi ies adequa e in e nal consis ency, and C onbach’s Alpha alues abo e 0.60 con i m
measu emen eliabili y.
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Table 1: Assessmen o Cons uc Validi y and Reliabili y
Cons uc
Indica o
Loading
Fac o
C onbach's
Alpha
Composi e
Reliabili y
AVE
F aud Hep agon
P essu e
0.830
0.907
0.916
0.652
Oppo uni y
0.801
Ra ionaliza ion
0.791
Capabili y
0.853
A ogance
0.632
Collusion
0.637
G eed
0.577
Audi Repo Lag
ARL
1.000
1.000
1.000
1.000
Whis le-blowing Sys em
Repo _Chanel
0.861
0.787
0.806
0.522
Follow_up
0.904
Valid_Repo
0.776
F audulen Financial S a emen
DSRI
0.804
0.887
0.896
0.622
DEPI
0.691
AQI
0.727
GMI
0.824
LVGI
0.681
SGAI
0.642
SGI
0.805
TATA
0.567
Good Co po a e Go e nance
Ind_Comm
0.909
1.000
1.000
0.536
Ac i e_AC
0.777
Mode a ing E ec
FH * GCG
1.088
1.000
1.000
1.000
ARL * GCG
1.136
1.000
1.000
1.000
WBS * GCG
1.174
1.000
1.000
1.000
The esul s o he cons uc alidi y and eliabili y assessmen in his s udy e eal ha all cons uc s mee he ecommended s a is ical
h esholds. The F aud Hep agon cons uc demons a es s ong eliabili y, wi h C onbach’s Alpha = 0.907, Composi e Reliabili y
(CR) = 0.916, and A e age Va iance Ex ac ed (AVE) = 0.652, all exceeding he accep ed benchma ks o CR > 0.70 and AVE > 0.50
(Hai e al., 2021). This indica es ha i s se en indica o s—p essu e, oppo uni y, a ionaliza ion, capabili y, a ogance, collusion,
and g eed—collec i ely cap u e he mul idimensional cha ac e is ics o audulen beha io . Howe e , indica o s such as a ogance
(0.632), collusion (0.637), and g eed (0.577) exhibi mode a e loadings, sugges ing ha hei in luence may a y depending on
con ex ual and beha io al ac o s.
Simila ly, he Whis leblowing Sys em (WBS) cons uc shows accep able in e nal consis ency (α = 0.787; CR = 0.806; AVE = 0.522),
wi h all indica o s loading abo e 0.75, con i ming ha epo ing and ollow-up dimensions a e measu ed eliably. The F audulen
Financial S a emen cons uc also displays high alidi y (α = 0.887; CR = 0.896; AVE = 0.622), signi ying ha i s eigh Beneish
a io indica o s e ec i ely cap u e manipula ion endencies, hough he TATA a iable (0.567) con ibu es less s ongly. Meanwhile,
Audi Repo Lag, E ec i e co po a e go e nance (GCG), and he mode a ion in e ac ion e ms achie e pe ec eliabili y (α = CR =
1.000), consis en wi h single-indica o cons uc s. O e all, hese esul s con i m ha he Sma PLS 3.27 measu emen model ul ills
he equi emen s o con e gen alidi y, disc iminan alidi y, and in e nal consis ency eliabili y, enabling obus in e p e a ion o
subsequen hypo hesis es ing ou comes. A e con i ming he alidi y and eliabili y o he measu emen model, he analysis p oceeds
o he inne (s uc u al) model e alua ion o es hypo hesized causal ela ionships among la en cons uc s. In Sma PLS 3.27, his
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s age examines se e al key me ics, including pa h coe icien s, coe icien o de e mina ion (R²), p edic i e ele ance (Q²), and e ec
size ( ²). Pa h coe icien s e lec he s eng h and di ec ion o ela ionships be ween a iables, while R² alues indica e he deg ee o
which exogenous cons uc s explain he a iance in endogenous cons uc s.
The Hypo hesis Tes ing
Finally, hypo hesis es ing is ca ied ou using he boo s apping echnique wi h 5,000 esamples o ob ain -s a is ics and p- alues o
each hypo hesized ela ionship. A ela ionship is conside ed s a is ically signi ican i > 1.96 and p < 0.05, he eby suppo ing he
accep ance o he p oposed hypo heses. This igo ous analy ical app oach ensu es ha he s uc u al model accu a ely e lec s he
heo e ical amewo k and p o ides eliable empi ical e idence o he es ed ela ionships (Hai e al., 2021).
Table 2: Summa y o Hypo hesis Tes ing
Hypo hesis
Be a (β)
S d.
De
T
S a is ics
P
Values
Resul
H1
F aud Hep agon -> F audulen Financial
S a emen
0.116
0.013
8.626
0.000
Suppo ed
H2
Audi Repo Lag -> F audulen Financial
S a emen
0.001
0.011
0.115
0.909
No Suppo ed
H3
Whis le-blowing Sys em -> F audulen
Financial S a emen
-0.513
0.016
31.665
0.000
Suppo ed
Good Co po a e Go e nance -> F audulen
Financial S a emen
-0.434
0.017
25.729
0.000
(-) Signi ican
H4
Mode a ing E ec GCG-FH -> F audulen
Financial S a emen
0.063
0.014
4.338
0.000
Suppo ed
H5
Mode a ing E ec GCG-ARL -> F audulen
Financial S a emen
-0.008
0.013
0.672
0.501
No Suppo ed
H6
Mode a ing E ec GCG-WBS ->
F audulen Financial S a emen
0.084
0.013
6.581
0.000
Suppo ed
The hypo hesis es ing esul s con i m ha ou o he six p oposed hypo heses we e suppo ed. The F aud Hep agon’s signi ican
impac on audulen inancial epo ing alida es H1, indica ing ha he se en beha io al and o ganiza ional componen s
meaning ully con ibu e o manipula ion endencies. H3 is also suppo ed, demons a ing ha i ms wi h s onge Whis leblowing
Sys ems a e subs an ially less likely o engage in aud. Meanwhile, H2—conce ning he di ec in luence o Audi Repo Lag—was
no suppo ed, sugges ing ha delayed epo ing is no a su icien indica o o aud wi hou conside ing go e nance con ex o
manage ial beha io .
The mode a ing e ec s o Good Co po a e Go e nance p o ide addi ional insigh s. GCG signi ican ly mode a ed he ela ionship
be ween he F aud Hep agon and audulen epo ing (β = 0.063, p = 0.000), suppo ing H4. This inding implies ha go e nance
s uc u es in luence how beha io al p essu es mani es in o audulen ou comes. GCG also mode a ed he ela ionship be ween
Whis leblowing Sys ems and aud (β = 0.084, p = 0.000), suppo ing H6 and indica ing ha whis leblowing becomes mo e e ec i e
when embedded wi hin s ong go e nance en i onmen s. Howe e , GCG did no signi ican ly mode a e he ela ionship be ween
Audi Repo Lag and aud (β = –0.008, p = 0.501), esul ing in H5 no being suppo ed. This sugges s ha go e nance mechanisms,
while obus in shaping beha io al ac o s, may ha e limi ed in luence in al e ing he p ocedu al dynamics associa ed wi h audi
imeliness.
Taken oge he , he esul s highligh ha beha io al and e hical mechanisms—cap u ed h ough he F aud Hep agon, Whis leblowing
Sys ems, and GCG—play a a mo e decisi e ole in shaping aud ou comes han p ocedu al indica o s like audi delays. The model’s
indings a i m he impo ance o in eg a ing go e nance and e hical in as uc u e o enhance aud p e en ion, especially in
en i onmen s whe e beha io al p essu es and cul u al ac o s s ongly in luence manage ial decision-making.
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Audi Repo Lag as In e ening Va iable. Jou nal o Accoun ing and S a egic Finance, 3(2), 243–257.
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