Fraud is a global business problem causing significant ethical dilemmas for businesses and harmful to capital market participants. Fraud gives rise to severe financial losses. Fraud in financial reporting is the intentional misstatement of financial information to mislead the financial statement’s users. It threatens investors’ confidence in published financial statement. Fraudsters are commonly involved in finance or finance-related functions for reasons of unattainable high earnings projection, personal gain and weakening moral values. Fraud is indeed a very difficult misconduct to prove as it is normally concealed, not easily measurable or detectable. The main objective of this study is to examine the factors influencing intention for fraud in financial reporting among Muslim accounting practitioners in a highly regulated Malaysian banking industry. The intention rather than actual occurrence of fraud in financial reporting is examined, as the likelihood of performing behaviour depends on the level of behavioural intention. This study adopts a mixed method approach that employs aspects of both quantitative and qualitative procedures involving self-administered questionnaire and semi-structured interviews. A total of 121 respondents were involved in the survey and partial least square structural equation modelling was used in analysing the quantitative data. The results indicate that attitude, subjective norm and ethical judgments are influential factors, whereas perceived behavioural control, Islamic religiosity and adherence to Islamic professional ethics are not influential factors in the intention for financial reporting fraud. Meanwhile, twenty interviewees participated in the semi-structured interviews that provide supports to all significant survey findings but partially support the results on perceived behavioural control and contradict the findings on the Islamic religiosity and adherence to Islamic professional ethics. The input gathered from the semi-structured interviews was analysed and categorised into meaningful perspectives, which led to three new emerging themes of high regulation, the tone at the top and secular worldview. This study contributes in testing the extended Theory of Planned Behaviour that incorporates ethics factor and religious values based on Rest’s four component model and Hunt and Vitell’s model. Although the theories are developed in the west, the variables such as attitude, subjective norms, perceived behavioural control and ethical judgment are applicable to the Islamic environment. However, the variables of Islamic religiosity and Islamic professional code of ethics are specifically tailored for the Muslims due to the differences between the Western and Islamic environment. This study specifically highlights the influence of Muslim accounting practitioners’ Islamic worldview on fraud intention. The emerging factors that influence intention provide new perspectives to auditors, top management and regulators within the industry in developing strategies to curb the intention for fraud in financial reporting.

The function of management accounting systems (MAS) in an organization has evolved from the traditional cost determination and financial control role to a more sophisticated role of value creation through the effective use of resources. Financial institutions are experiencing rapid transformation due to financial liberalization, rapid advancement in technology, intense market competition, and the emergence of increasingly innovative products and distribution channels. To remain competitive, they need sophisticated MAS information for informed decision making and to create value for the long term success and survival of the organization. Due to the lack of management accounting research for financial services, this study investigates the factors influencing MAS sophistication among financial institutions in Malaysia and examines whether it leads to enhanced organizational performance. Sophistication of MAS is viewed in a broader aspect by focusing on the four dimensions of MAS information – scope, timeliness, integration and aggregation. In addition, since financial institutions are essentially in the business of managing risks, this study also explores the relationship between enterprise risk management (ERM) and MAS. In ERM, performance management, which is the most important role of MAS, is integrated with risk management. With the existence of a dual banking system in Malaysia, it is also important to explore the difference between MAS of Islamic Financial Institutions (IFIs) and that of conventional financial institutions. Based on the contingency theory framework, this study adopts an explanatory sequential mixed method approach that was conducted in two stages. In the first stage a survey was conducted on the banking and insurance companies listed on the Central Bank of Malaysia website, with the chief financial officers (CFO) as the respondents. In the second stage, post-survey semi-structured interviews were conducted with selected respondents. Based on multiple regression analysis, the results indicate that perceived intensity of market competition and technological advancement influence MAS sophistication. The results provide support of a direct relationship between MAS and organizational performance and show some support for the mediating role of MAS between contextual variables and performance. The post-survey interviews further support the results. The findings from the survey and the post-survey interviews also show that MAS and risk management complement each other. However, there was not enough evidence to support the role of risk management in enhancing the relationship between MAS and organizational performance. The post-survey interviews provide some insights into this issue. The findings further show that IFIs use more sophisticated MAS than conventional financial institutions. Overall, this study demonstrates the importance of MAS sophistication for coping with the intensity of market competition and of rapid technological advancement in financial institutions to achieve better performance. In addition, the study also provides evidence of the importance of MAS and risk management as integral management tools for corporate performance management. Finally, as IFIs have to adhere to the SharÊÑah compliance framework they require more sophisticated MAS to manage their organizations effectively. The findings contribute to financial institutions and regulators as well as towards testing a comprehensive contingency model that includes multiple contingent factors, multiple elements of accounting systems, and multiple outcome variables.