The Impact of Forensic Accounting Techniques on The Quality of Financial Reporting Through Multiple Intermediaries

Abstract

The study aims to analyses the relationship path between forensic accounting techniques - namely financial ratio analysis, trend analysis, critical point auditing, and relative size Theory - and financial reporting quality through multiple mediation, represented by the detecting of creative accounting practices and financial fraud.

The study adopted a survey approach targeting certified auditors certified by The Accounting and Auditing Council and licensed to practice auditing for joint-stock companies in Syria for the year 2023. The study population consisted of 120 professional practice licences, including 86 individual auditors, 34 auditing offices, and 6 audit firms. A total of 97 questionnaires were returned and deemed valid for analysis. The questionnaires were distributed both manually and electronically, and statistical analyses were conducted using SmartPLS₄ software.

The results related to the direct relationship path between forensic accounting techniques and financial reporting quality indicate that trend analysis is the most influential technique in enhancing financial reporting quality and detecting financial fraud. In contrast, financial ratio analysis was found to be the most influential technique in detecting creative accounting practices in joint-stock companies in Syria for the year 2023.

Furthermore, the results related to the indirect relationship path reveal that the variables of detecting creative accounting practices and financial fraud partially and complementarily mediate the relationship between forensic accounting techniques and financial reporting quality.