Impact of the Corporate Governance on the Financial Statement Fraud: A Study Focused on Companies in Tanzania
Ally Faraj Abri1, Dhamayanthi Arumugam2, Suresh Balasingam3

1Ally Faraj Abri, Asia Pacific University of Technology and Innovation, Malaysia.
2Dhamayanthi Arumugam, Asia Pacific University of Technology and Innovation, Malaysia.
3Suresh Balasingam, Asia Pacific University of Technology and Innovation, Malaysia.
Manuscript received on 06 February 2019 | Revised Manuscript received on 12 February 2019 | Manuscript Published on 19 February 2019 | PP: 336-341 | Volume-7 Issue-5S January 2019 | Retrieval Number: ES2163017519/19©BEIESP
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Abstract: In the previous couple of years, the attention of the public has been increasing rapidly towards big corporations and their disclosures of accounting frauds and false reporting as well as high amounts of compensations given to the executives and mismanagement leading to bankruptcy faced by the large corporations. The accounting frauds and poor corporate governance system have been reported in many countries including Tanzania, USA, and Canada etc. The scandals committed by large companies in Tanzania was brought to public attention when it began around 2005 which led to loss of millions of dollars. These scandals were such as External payment arrears known as EPA and the scandal of Escrow. Corporate governance system has a major impact on the financial statements and accounting fraud in the company. Good corporate governance means that the financial statements reported to the public will be free from errors and accounting frauds will be minimized. The general objective of this research is to analyze the impacts of corporate governance system on the financial statement frauds particularly with companies in Tanzania. The design and approach of this study is chosen as a quantitative research which incorporates primary data. The primary data of this research will includes questionnaires given to stakeholders of companies in Tanzania. The results indicate that Audit committee effectiveness, tone at the top level management, Independence of BOD and Audit committee, policies and ethical guidance and corporate culture has a direct impact on the financial statement fraud. Future researchers may also include other areas of corporate governance in which they can include other variables such as Board meeting and board size should be included in relating to how it affects the overall quality of financial reports and the financial statementfraud.
Keywords: Corporate Governance, Financial Statement Fraud, Tanzania.
Scope of the Article: Social Sciences