THE IMPACT OF BOARD INDEPENDENCE, WOMEN ON BOARD AND AUDITOR INDEPENDENCE ON THE FRAUD: EVIDENCE FROM JORDANIAN FIRMS

In developing economies, fraud is an important subject due to the impact on the financial reporting quality. This study discovers the impact of board independence, women on board and auditor independence on the fraud in financial reporting for a sample covers of 86 year observations of industrial firms listed in Amman Stock Exchange from 2015 to 2016. In this study, income smoothing was a proxy for fraud in financial reporting. Using the multiple regression analysis, the results revealed that board independence and auditor independence plays the key role in prevention the fraud in financial reporting. This study concluded that more independent directors would make lower fraud in financial report. This study provides evidence that the provision of NAS by an external auditor positively contributes to fraud in financial reporting. Nevertheless, the outcomes show that the women on board do not have any effect on the fraud in the financial reporting among industrial Jordanian firms. The current study contributes to the existing literature of fraud and stimulates future research about the factors determinants of the fraud in financial reporting in other developing countries.