The Relationship between Corporate Governance and Management Fraud: An Empirical Analysis

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ABSTRACT

Management fraud is an important issue, as determined by significant governing bodies and major accounting firms. There are significant implications for the profession and the capital markets stemming from instances of management fraud. This study determined instances of management fraud using SEC Accounting & Auditing Enforcement Releases (AAER's) and advances our understanding of how corporate governance factors might impact instances of management fraud. Overall, results of the analysis point to the importance of corporate governance playing a role in limiting instances of management fraud, especially auditor identity and tenure.

INTRODUCTION

The …