Examining the Psychological Aspect: Fraudulent Financial Reporting in Property and Real Estate Companies Listed on the Indonesia Stock Exchange During the Covid-19 Pandemic using the Fraud Heptagon Approach

Abstract

The fraud heptagon approach will be used in this study to analyze 20 or so real estate and property companies that are publicly traded on the Indonesian stock exchange. Fraudulent financial reporting is very common among these companies, particularly during the COVID-19 pandemic, as shown by the prevalence of financial statement fraud. This study compares the likelihood of fraud occurring in the years leading up and subsequent to the COVID-19 pandemic (2018–2019 and 2020–2021), with the aim of identifying trends. Analysis using the heptagon fraud approach affects the percentage level of fraudulent financial reporting in property and real estate companies that are listed on the Indonesia Stock Exchange. This study also uses the Beneish M-Score indicator which is based on the calculation of 8 financial ratios to identify whether a company has fabricated fraudulent financial reporting.