A Comprehensive Pattern of Fraudulent Financial Reporting in Iran, Grounded Theory

• Main Authors: سید حسین سجادی, Tohid Kazemi
• Format: Article
• Language: fas
• Published: Alzahra University 2016-11-01
• Series: پژوهش‌های تجربی حسابداری
• Subjects: forensic accounting; fraud scheme; Fraudulent financial reporting; grounded theory
• Online Access: http://jera.alzahra.ac.ir/article_2542_446de0a197ece6901eea014828ce349c.pdf

This paper attempts to provide a comprehensive pattern of financial reporting fraud in cultural, economic and legal areas in Iran by combined qualitative research methods using Grounded Theory and Documents Analyses approaches. Statistical population consisting of all experts in fraud area is determined by snowball sampling.  Furthermore 5 available fraud cases have been analyzed and 1000 independent auditor’s reports have been reviewed. In addition to interviews, existing documents and evidence in respect of fraudulent financial reporting of firms listed in Tehran Stock Exchange have been reviewed and analyzed. Results show that pressure as the main casual factor along with asset misappropriation, political costs, tax purposes and acquisition motivations are effective on fraudulent financial reporting. Schemes of fraudulent financial reporting are appeared in accounting standards, legal system and common cultures considered as the contextual conditions and in corporate governance, internal controls and auditing quality considered as intervening conditions. 25 fraud schemes and their consequences are introduced in this study. In addition, this study classifies and interprets fraudulent financial reporting consequences in two areas of financial statements and capital market.