WHATS WRONG WITH THE TREADWAY COMMISSION REPORT - EXPERIMENTAL ANALYSES OF THE EFFECTS OF PERSONAL VALUES AND CODES OF CONDUCT ON FRAUDULENT FINANCIAL-REPORTING

In three studies, factors influencing the incidence of fraudulent fina ncial reporting were assessed. We examined (1) the effects of personal values and (2) codes of corporate conduct, on whether managers misrep resented financial reports. In these studies, executives and controlle rs were asked to respond to hypothetical situations involving fraudule nt financial reporting procedures. The occurrence of fraudulent report ing was found to be high; however, neither personal values, codes of c onduct, nor the interaction of the two factors played a significant ro le in fraudulent financial reporting.