Proceedings of The First International Conference on Financial Forensics and Fraud, ICFF, 13-14 August 2019, Bali, Indonesia

Research Article

The Role of Professional Auditor Skepticism and Red Flag Understanding in Assessing Risk of Fraud: An Experimental Study

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  • @INPROCEEDINGS{10.4108/eai.13-8-2019.2294257,
        author={Ni Made Wisni Arie Pramuki and Komang Ary Pratiwi and Putu Atim Purwaningrat and I Gede Aryana Mahayasa},
        title={The Role of Professional Auditor Skepticism and Red Flag Understanding in Assessing Risk of Fraud: An Experimental Study},
        proceedings={Proceedings of The First International Conference on Financial Forensics and Fraud, ICFF, 13-14 August 2019, Bali, Indonesia},
        publisher={EAI},
        proceedings_a={ICFF},
        year={2020},
        month={5},
        keywords={professional auditor skepticism red flags understanding fraud risk assessment},
        doi={10.4108/eai.13-8-2019.2294257}
    }
    
  • Ni Made Wisni Arie Pramuki
    Komang Ary Pratiwi
    Putu Atim Purwaningrat
    I Gede Aryana Mahayasa
    Year: 2020
    The Role of Professional Auditor Skepticism and Red Flag Understanding in Assessing Risk of Fraud: An Experimental Study
    ICFF
    EAI
    DOI: 10.4108/eai.13-8-2019.2294257
Ni Made Wisni Arie Pramuki1,*, Komang Ary Pratiwi1, Putu Atim Purwaningrat1, I Gede Aryana Mahayasa1
  • 1: Universitas Hindu Indonesia
*Contact email: wisniariepramuki@gmail.com

Abstract

This study aims to examine the level of skepticism of professional auditors and the understanding of red flags in detecting fraud. Professional auditor's skepticism as an internal auditor factor and understanding red flags as an external auditor factor. This study uses a 2x2 factorial design between subjects. Professional skepticism and understanding of red flags are manipulated at 2 levels namely high and low professional skepticism and high and low understanding of red flags. The experimental subjects were 60 undergraduate accounting students who had studied the auditing process. ANOVA is applied as a tool to test hypotheses. The results show that fraud risk assessment is influenced by professional auditor skepticism and understanding of red flags.