Kim B. Tan

An “American Dream” theory of corporate executive Fraud

Abstract In this paper, we first describe a “Broken Trust” theory that was introduced by Albrecht el al. [Albrecht, W. S., Albrecht, C. C., & Albrecht, C. O. (2004). Fraud and corporate executives: Agency, Stewardship and Broken Trust. Journal of Forensic Accounting, 5, 109–130] to explain corporate executive Fraud. The Broken Trust theory is primarily based on an “Agency” theory from economic literature and a “Stewardship” theory from psychology literature. We next describe an “American Dream” theory from sociology literature to complement Albrecht el al.s (2004) Broken Trust theory. Like the Broken Trust theory, the American Dream theory relates to a “Fraud Triangle” concept to explain corporate executive Fraud. Finally, we provide some anecdotal evidence from recent high profile corporate executive Fraud to explore the American Dream theory. We conclude our thoughts on corporate executive Fraud from a teaching perspective.

Accounting Student Characteristics From 2005–2010 Archival Transcript Data

Prior studies have investigated the characteristics of accounting students using survey data. The authors use archival transcript data to investigate some characteristics of accounting students at one institution, such as trend in graduation rates, distribution of male versus female students, and distribution of transfer versus native students. The authors found the grade from the first intermediate accounting class to be a reliable predictor of accounting student success at graduation. Gender and transfer status were not found to be strong predictors.

The effect of fraud triangle factors on students’ cheating behaviors

This study explores the effects of fraud triangle behaviors (pressure, opportunities, and rationalization) on students’ self-reported propensity to cheat in class. We found each fraud triangle factor to be an influence on the students’ propensity to cheat. Additionally, we observed a statistically significant three-way interactive effect indicating that all three factors jointly influence the students’ propensity to cheat. These findings provide insights for accounting educators concerned with preventing classroom cheating. They also confirm the call by Statement on Auditing Standards No. 99 for auditor focus on fraud triangle variables. This exploratory study also suggests that future research is needed to examine the interactive effects of personality characteristics with fraud triangle factors to better understand student cheating behaviors.

A Commentary on Sample Design Issues in Behavioral Accounting Experiments

Behavioral research in accounting deals with the behavior of accountants. As such, it uses accounting subjects. Accounting subjects are very difficult to come by because of the nature of the accounting environment. First, professional accountants operate in a pressured environment in which they have little or no time to participate in behavioral research. Second, professional accountants operate in an environment of high service charges and have little or no interest in participating in behavioral experiments free or for a token remuneration. Third, professional accountants are usually inaccessible because behavioral researchers have few or no opportunities for contacts within a CPA firm. Finally, professional accountants operate in the real world in which they perceive behavioral research as too abstract to have practical value for them to participate in. Given the difficulties in getting accounting subjects, behavioral researchers often lament that the pool of available accounting subjects is very small. As such, they cannot rely on conventional research strategies that assume, among other things, normal distribution and homogeneity of variances. In this paper, we suggest a broad range of research strategies including sampling, design, measurement, and analysis to deal specifically with a very small pool of available accounting subjects. We cite some prior behavioral accounting studies and refer to some statistic textbooks deemed best for the application of these research strategies. Our suggestions should benefit anyone doing behavioral research in accounting.

The American Dream and Corporate Executive Fraud

In this paper, we first describe a “Broken Trust” theory that was introduced by Albrecht el al. (2004) to explain corporate executive fraud. The Broken Trust theory is primarily based on an “Agency” theory from economic literature and a “Stewardship” theory from psychology literature. We next describe an “American Dream” theory from sociology literature to complement Albrecht el al.’s (2004) Broken Trust theory. Like the Broken Trust theory, the American Dream theory relates to a “Fraud Triangle” concept to explain corporate executive fraud in America. We are motivated to explain corporate executive fraud because whenever corporate fraud has been studied, CEOs and CFOs are most involved. For example, the COSO-sponsored study by Beasley et al. (1999) found that CEOs were involved in 72% of the financial statement fraud cases. The next most frequent perpetrators in descending order of frequency were the controller, COO, vice presidents, and members of the board. In addition, we are motivated to provoke thoughts on corporate executive fraud in American society and to stimulate further empirical research on social variables of executive fraud.

A Guide to Qualitative Field Research, 2nd Edition, C.A. Bailey. Sage Publications, Thousand Oaks, CA (2007), 214 pp.

the backbone of the 3rd edition illustrating how the new science is essential for our need to respond to disasters and stop terrorism. Wheatley’s Leadership and the New Science left more questions than offered answers (which was likely intentional). While some interpretations to points of confusion may have gotten lost within the dense metaphoric language of the book, the reader may be left with a variety of insightful pauses and few tangible moments of clarity. For example, Wheatley focuses a lot on the structures and processes within organizations. However, can an organization look Newtonian by design/structure, but be quantum by organizational culture and leadership dynamics? Also a common comment is that sometimes we have too much data in organizations and we do not know how to use it. This is where the skill of translating data into information is essential. However, if the process of organizing information is continuous as Wheatley argues, then are we inherently bound to always make decisions based upon the best available information in that moment? If this is the case, how can we engage in forecasting or strategic planning? Further, Wheatley claims that chaos is necessary for change. Yet, Wheatley’s book is based on the premise that we need to see the order in chaos. In turn, science and hierarchical structures in organizations are founded on the principle of keeping chaos out. Therefore, is the old science really that different from the new science when it comes to ushering in change? Finally, Wheatley contends that science is all around us, that science is inherent in how we think and create in leadership, and that the impacts of science in organizations are undeniable. However, she believes science is difficult for some to embrace. Why is science the act of a few if it is ingrained in our modalities of being in the world? Leadership and the New Science is an interesting read for students who are intrigued by traveling down the rabbit hole of meta-physical reality and systems thinking. It is written in a streaming style with repetition and eye catching photos. The text would work well for undergraduate and graduate students within courses focused on the following topics: research methodologies and methods, scientific inquiry, public administration, business science, organization theory/development/behavior, leadership and management, American government, or international relations. Wheatley has gifted a great service to the fields of social science by open a space for dialogue about chaos theory, systems thinking, and quantum physics. However, a space with no boundaries offers the reader few opportunities to embrace the concepts presented. We cannot get our mental net around that which cannot be caught: the unknown quantum unknowns of change, relationships, and chaos. Amy E. Gould ∗ The Evergreen State College, 2700 Evergreen Parkway NW, Olympia, WA 98505, USA ∗ Tel.: +1 360 867 6135; fax: +1 360 867 6794. E-mail address: goulda@evergreen.edu