Abstract:
This study aims to examine the effect of fraud triangle elements on financial
statement fraud in mining companies listed on the Indonesia Stock Exchange during
the 2019–2023 period. The fraud triangle is represented by financial stability,
external pressure, and financial target as pressure factors; ineffective monitoring
and nature of industry as opportunity factors; and change in auditor and audit
opinions as rationalization factors. Financial statement fraud is measured using the
Beneish M-Score with a total of 200 samples, and the hypotheses were tested using
SPSS software. The findings show that only the financial target variable has a
significant positive effect on financial statement fraud, while financial stability,
external pressure, ineffective monitoring, nature of industry, auditor change, and
audit opinion have no significant effect. These results support the fraud triangle
theory, which emphasizes that certain types of pressure can drive fraudulent
financial reporting practices. This study is limited to the mining sector and employs
a restricted set of proxies; therefore, future research is recommended to expand the
scope to other industries, extend the observation period, and incorporate additional
variables from the fraud diamond or fraud hexagon frameworks to provide more
comprehensive insights.
