Fraud Inference Investigation within Tourism Sector in Jordan

This study comes to search for fraud manifestation in the hospitality sector companies, which amount to 11 companies operating in Jordan, in the period of (2000-2016). Benfold law has been used to discover if there are any differences between the actual and the expected frequencies, which indicates...

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Bibliographic Details
Published in:Journal of economic & management perspectives 2018-03, Vol.12 (1), p.5-20
Main Authors: Jawabreh, Omer, Bader, Ahmad, Saleh, Mousa, Alrabei, Ali Mahmoud Abdallah
Format: Article
Language:English
Subjects:
Accounting
Earnings management
Earnings per share
Financial statements
Fraud
Hospitality industry
Investigations
Investments
Net income
Net losses
Profits
Researchers
Statistical significance
Tourism
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Summary:This study comes to search for fraud manifestation in the hospitality sector companies, which amount to 11 companies operating in Jordan, in the period of (2000-2016). Benfold law has been used to discover if there are any differences between the actual and the expected frequencies, which indicates the occurrence of a fraud. Sales account, net income account, and earnings per share (EPS) indicator, all have been tested to see if there are inferences of fraud in these financial records. This study tests if there are indications of fraud by first digit for both of sales and net income accounts (profit and loss); each group separately, moreover Rounding-up and rounding-down manifestation has been tested to see if they exist in the hospitality companies, where second digit test has been done for each of the sales and the net income accounts (loss) or (profit), and finally (EPS) indicator rounding test has been done, which also a form of fraud. For the first digit tests the result shows some indications of fraud in sales and net income accounts (profit), but the net income account (loss) shows no indication of fraud, and for second digit test the results showed that hospitality companies don't perform such manifestation (Rounding-up and rounding-down), lastly (EPS) rounding don't perform. The article highlights the benefits of the application of Benfold law to detect Fraud inference in hospitality sector the paper can also serve as a basis for further research in the area of fraud in the hospitality industry.
ISSN:2523-5338
2523-5338