Title: The Effectiveness of Forensic Accounting's Fraud Detection and Prevention Function in Reducing Fraud in Medium-Sized Enterprises
Authors: Toshca Gaile H. Basilio, Jennilyn R. Cortez, Sophia Amber G. Cristobal, Alyssa A. Valenzuela, John Arcel S. Yutuc, Alan Y. Cabaluna, PhD, Jason Y. Carreon, CPA, MBA
Volume: 10
Issue: 7
Pages: 385-391
Publication Date: 2026/07/28
Abstract:
This study examined the effectiveness of forensic accounting's fraud detection and prevention function in reducing fraud in medium-sized enterprises in the Philippines. Specifically, it investigated the influence of forensic accounting practices on minimizing asset misappropriation and fraudulent financial reporting. A quantitative-causal research design was employed. Data were collected from 30 forensic accountants in the Philippines through a structured questionnaire and analyzed using descriptive statistics, Pearson correlation, and regression analysis using SPSS. The findings revealed that respondents perceived forensic accounting as highly effective in detecting and preventing fraud. Fraud detection was recognized as an essential monitoring tool for identifying irregular and suspicious transactions, while fraud prevention strengthened internal controls and reduced opportunities for fraudulent activities. Internal controls, asset tracing, and financial reporting policies were found to effectively reduce fraud in medium-sized enterprises, although practices such as continuous monitoring and inspection checks were less consistently implemented. Regression analysis further showed that forensic accounting practices significantly contribute to fraud reduction. The study concludes that forensic accounting plays a significant role in enhancing financial transparency, accountability, and organizational control systems, highlighting the importance of adopting forensic accounting practices to mitigate fraud and improve the sustainability of medium-sized enterprises.