HERSUGONDO, Hersugondo (2025) Artikel Dr. HERSUGONDO, SE, MM: Mitigating Financial Statement Fraud through FraudHeptagon, Digital Forensics,and Risk Management: Evidence fromIndonesia’s StateOwned Enterprises. International Journal of Accounting and Economics Studies, 12 (8).

Text (Artikel) MITIGATING FINANCIAL STATEMENT FRAUD THROUGH FRAUD HEPTAGON, DIGITAL FORENSICS, AND RISK MANAGEMENT.pdf - Published Version Download (423kB)

Abstract

Financial statement fraud poses a critical threat to organizational integrity and stakeholder trust worldwide, particularly in state-owned
enterprises (SOEs) where public accountability is paramount. This study investigates how the Fraud Heptagon framework, digital forensics,
and risk management practices mitigate financial statement fraud, providing insights relevant for both national and international contexts.
A mixed-methods approach was adopted, combining quantitative analysis of 116 firm-year observations from 68 SOEs listed on the Indo
nesia Stock Exchange during 2020–2024 with qualitative data from semi-structured interviews with auditors, risk officers, and forensic
specialists. The quantitative results reveal that the integrated Fraud Heptagon dimensions, including greed, opportunity, pressure, rational
ization, capability, arrogance, and collusion, significantly drive financial statement fraud, while digital forensic tools and risk management
mechanisms effectively moderate these effects. Qualitative findings emphasize that systemic pressures, operational demands, and institu
tional weaknesses foster fraudulent behaviors, whereas technological and risk-based interventions enhance detection, transparency, and
organizational accountability. This study underscores that financial statement fraud is primarily a systemic phenomenon rather than an
outcome of isolated individual misconduct, highlighting the necessity of integrating behavioral frameworks with technological enforcement
and structured governance. By applying the Fraud Heptagon alongside digital forensics and risk management, organizations can implement
a comprehensive fraud prevention strategy. The results offer valuable implications for policymakers, regulators, and corporate governance
bodies globally, emphasizing-ing the importance of robust fraud detection, prevention mechanisms, and transparency to safeguard financial
reporting integrity in public and private sectors.

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