The effect of applying COSO-ERM model on reducing fraudulent financial reporting of commercial banks in Jordan
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DOIhttp://dx.doi.org/10.21511/bbs.13(2).2018.09
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Article InfoVolume 13 2018, Issue #2, pp. 107-115
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Creative Commons Attribution-NonCommercial 4.0 International License
This study aims to test the effect of applying the model of the Committee Sponsoring Organizations for enterprise risk management (COSO-ERM) on reducing fraudulent financial reporting in commercial banks operating in Jordan. Furthermore, the study identifies the role of each board of directors, audit committee, executive management, human resource management, and internal audit as one of the corporate governance mechanisms in enhancing the effectiveness of internal control systems. The study revealed an impact of applying the Committee of Sponsoring Organizations model for enterprise risk management (COSO-ERM) on preventing fraudulent financial reporting, where it reached influence around 77.8% on the dependent variable (fraudulent financial reporting). The study also found that each of internal control, event identification, risk assessment and response, and control activities variables affects dependent variable (fraudulent financial reporting) in commercial banks operating in Jordan.
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JEL Classification (Paper profile tab)H83, G21, E58, Q52
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References16
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Tables8
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Figures0
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- Table 1. Results of a multiple linear regression analysis to test the main hypothesis (H0)
- Table 2. Results of a simple linear regression analysis to test the first sub-hypothesis (H01)
- Table 3. Results of a simple linear regression analysis to test the second sub-hypothesis (H02)
- Table 4. Results of a simple linear regression analysis to test the third sub-hypothesis (H03)
- Table 5. Results of a simple linear regression analysis to test the fourth sub-hypothesis (H04)
- Table 6. Results of a simple linear regression analysis to test the fifth sub-hypothesis (H05)
- Table 7. Results of a simple linear regression analysis to test the sixth sub-hypothesis (H06)
- Table 8. Results of a simple linear regression analysis to test the seventh sub-hypothesis (H07)
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The effect of internal control environment on the value relevance of earnings
Hyun-Ah Lee
doi: http://dx.doi.org/10.21511/imfi.16(2).2019.16
Investment Management and Financial Innovations Volume 16, 2019 Issue #2 pp. 182-194 Views: 574 Downloads: 36 TO CITE АНОТАЦІЯThis study examines whether a suitable control environment increases the value relevance of earnings by providing greater assurance on the reliability of financial reporting. Specifically, the level of suitable control environment is assessed by considering the quantity and quality of IC personnel, which are closely related to the personnel integrity/ethical values, competence, and authority/responsibility. Using a sample of 1,834 firm-year observations of Korean listed companies covering 2005–2010, the author finds that earnings are more value relevant when the increase in the average work experience of IC personnel is greater. However, no evidence is found that the value relevance of earnings is positively associated with the increase in the proportion of IC personnel. The findings suggest that a suitable control environment, established by deployment of qualified IC personnel with more work experience, improves the IC effectiveness and, thus, provides greater assurance on the reliability of financial reporting to market investors.
