Profitability, Liquidity, Leverage and Corporate Governance Impact on Financial Statement Fraud and Financial Distress as Intervening Variable

Financial statement can show the company management performance after human resource trust. Each public company is obligated to reveal the annual financial report. This research examined correlation among profitability, liquidity, leverage and corporate governance to financial statement fraud and financial distress as mediation variable. Based on the Association of Certified Fraud Examiners (ACFE) 2016, the financial statement fraud continuously grew from 2012-2016. It means that there were more companies having financial statement fraud motivation. In this research, financial distress had been a mediation variable before the financial statement fraud event. This research applied quantitative research using the fraud diamond theory. This research proved that there was an impact of profitability, leverage, shareholder > 3% and directors quantity to financial distress. This research showed that the higher company's profitability, the lower financial distress company risks. Based on the research, the companies that had financial distress would tend to do the financial statement fraud.