Abstract:

The International Federation of Accountants (IFAC) provides a formal definition for "misstatement", which refer as " A difference between the amount, classification, presentation or disclosure of a reported financial statement item and the amount, classification, presentation or disclosure that is required for the item to be in accordance with the applicable financial reporting framework" (IFAC, December 2009:370). Ettredge, Scholz, Smith and Sun (2010) and Dechow, Ge, Larson, and Sloan (2011) viewed misstatement as the manipulation or falsification of financial statements disclosure, which have been conducted beyond the established accounting framework.