Forensic accounting tools for fraud deterrence: a qualitative approach

Published date16 May 2022
Date16 May 2022
Subject MatterAccounting & finance,Financial risk/company failure,Financial crime
AuthorAlberto Clavería Navarrete,Amalia Carrasco Gallego
Forensic accounting tools for
fraud deterrence: a
qualitative approach
Alberto Clavería Navarrete
Faculty of Economics and Business Sciences, University of Seville, Sevilla, Spain, and
Amalia Carrasco Gallego
Department of Accounting and Financial Economic,
Faculty of Economics and Business Sciences, University of Seville, Sevilla, Spain
Purpose The purpose of this paper is to understand if forensic accounting techniques and tools could
contribute to the deterrenceof fraud in nancial statements, considering the expertise of forensicaccountant
on ex post activitiesand that the traditional mechanisms to preventthis type of fraud have not been sufcient
to stop the impacton companies, investors, auditors, employeesand on society in general.
Design/methodology/approach This research was carried out using a qualitative exploratorystudy
with a phenomenological approach conducted through in-depth interviews with professional experts in the
Findings The ndings conrm that the use of forensicaccounting techniques and tools could contribute
to the preventionof fraud in nancial reporting not only when the risk of fraud has beenmaterialized. Similar
studies, about fraud prevention addressingthe situation under a qualitative approach from the perspectives
of its protagonists, have not been observed in the bibliographical review, so this research contributes to
expandingthe scientic research, the study and practice of forensic accounting.
Originality/value From a business management perspective, this study contributes a paradigm shift
from the traditional ex post forensic auditing activity toward an ex ante activity to improve management
control systems within organizations anywhere in the world. Because this study is guided to prevent
fraudulent nancial statements, other fraud categories such as misappropriation or corruption could be
addressedin other studies and various countries.
Keywords Fraudulent nancial reporting, Forensic accounting, Fraud deterrence,
Forensic data analytics, White-collar crimes, Financial crimes
Paper type Research paper
In recent years, fraudulent nancial reportshave signicantly affected market participants,
including investors,creditors, pensioners and employees (Zainudin and Hashim, 2016).
Although nancial statement frauds are the least common, with 10% of cases, they are
the most expensive (ACFE, 2020) and despitereceiving less attention, they can have a grave
and enormous impact on the world economy (Abdullah and Said, 2019). The potential
deterioration associatedwith nancial report fraud could therefore affect the reputation and/
or brand of the entity (e.g. Enron), its nancialsituation (e.g. Adelphia) or its ability to retain
JEL classication M41, M42, M48
Statements and declarations: The authors did not receive support from any organization for the
submitted work. The authors have no relevant nancial or nonnancial interests to disclose.
Journalof Financial Crime
Vol.30 No. 3, 2023
pp. 840-854
© Emerald Publishing Limited
DOI 10.1108/JFC-03-2022-0068
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