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Improving Accountants' Ability to Identify, Manage Running Head: FRAUD IN NOT-FOR-PROFITS IMPROVING ACCOUNTANTS’ ABILITY TO IDENTIFY, MANAGE, AND PREVENT FRAUD IN NOT-FOR-PROFIT ORGANIZATIONS by Gabrielle Fish _______________________ Doctoral Study Submitted in Partial Fulfillment of the Requirements for the Degree of Doctor of Business Administration ______________________ Liberty University, School of Business December 2019 Running Head: FRAUD IN NOT-FOR-PROFITS ii Abstract Fraud is a growing problem in the not-for-profit (NFP) sector; this problem increases because of the lack of fraud-prevention preparation had by NFP financial professionals. Furthermore, asset misappropriation is the most commonly perpetrated occupational fraud in NFPs. Although approximately 90% of all reported frauds are asset misappropriation, a gap in existing research results in limited data regarding asset misappropriation in NFPs. This study contains an extensive examination of peer-reviewed research regarding fraud topics, with an emphasis on asset misappropriation. The conceptual framework incorporated the Fraud Management Lifecycle Theory, the Fraud Triangle Theory, the Theory of White-Collar Crime, and the Routine Activity Theory. The project followed a qualitative exploratory case study design, interviewing fifteen participants to achieve data saturation. Recruitment included purposive sampling and snowball sampling. After interviews, data was analyzed using open coding, axial coding, and cross-case examination. The data revealed nine major themes, four that answered the main research questions and five that identified discoveries beyond the scope of the study. Each theme proved the need for additional research regarding fraud in the NFP sector, and demonstrating the need for this study. Key words: not-for-profit, asset misappropriation, fraud, preparation, prevention, detection, management, segregation of duties, fraud-prevention training Running Head: FRAUD IN NOT-FOR-PROFITS iii IMPROVING ACCOUNTANTS’ ABILITY TO IDENTIFY, MANAGE, AND PREVENT FRAUD IN NOT-FOR-PROFIT ORGANIZATIONS by Gabrielle Fish Doctoral Study Submitted in Partial Fulfillment of the Requirements for the Degree of Doctor of Business Administration Liberty University December 2019 ___________________________________________________ Date: 01/08/2020 Dr. Stanley W. Self, Dissertation Chair ___________________________________________________ Date: 01/10/2020 Dr. Teresa L. Bounds, Dissertation Committee Member ___________________________________________________ Date: 01/14/2020 Dr. Edward M. Moore, DBA Program Director Running Head: FRAUD IN NOT-FOR-PROFITS iv Dedication I would like to dedicate this dissertation project to my family and my parents; both of whom provided emotional and spiritual support as I navigated this process. The prayers of my entire family were appreciated more than they knew. I would like to thank my amazing husband, David Fish, who stood by me, continually encouraging me, and being willing to listen to all of my ideas. His support, advice, and willingness to take on extra responsibilities as I needed more time to work were instrumental in my success. Furthermore, I would like to thank my daughter Arabelle, as well as the bundle of joy I’ll soon meet, for encouraging me daily to be the best role model possible, following the path God called me to, even when it is difficult. Last, but not least, I would like to thank my parents for supporting me every day of my life, and believing in me whole-heartedly, no matter what goal I set out to achieve. Running Head: FRAUD IN NOT-FOR-PROFITS v Acknowledgements Too many people to count were involved in supporting me as I completed my doctoral research project. However, I would like to those who were instrumental in my academic success. First and foremost, I would like to thank my dissertation chair, Dr. Stanley W. Self. His continued guidance, support, and feedback throughout the doctoral process was invaluable. Additionally, I would like to thank my committee reviewer, Dr. Teresa L. Bounds, for her feedback and guidance. I would like to thank Dr. Edward M. Moore for his continued encouragement throughout the doctoral program. Finally, I would like to thank all of my friends and extended family who believed in me, and supported me throughout this process. Running Head: FRAUD IN NOT-FOR-PROFITS vi Table of Contents Abstract ........................................................................................................................................... ii Dedication ...................................................................................................................................... iii Acknowledgements ..........................................................................................................................v List of Tables ................................................................................................................................. xi List of Figures ............................................................................................................................... xii Section 1: Foundation of the Study ..................................................................................................1 Background of the Problem ................................................................................................ 1 Problem Statement .............................................................................................................. 4 Purpose Statement ............................................................................................................... 4 Nature of the Study ............................................................................................................. 5 Discussion of Method. ............................................................................................ 5 Discussion of Design .............................................................................................. 6 Summary of the nature of the study ........................................................................ 9 Research Questions ........................................................................................................... 10 Conceptual Framework ..................................................................................................... 10 The fraud management lifecycle theory ............................................................... 11 The fraud triangle .................................................................................................. 12 The theory of white-collar crime .......................................................................... 12 The routine activity theory .................................................................................... 13 Discussion of the relationships between concepts ................................................ 14 Summary of the conceptual framework ................................................................ 16 Definition of Terms........................................................................................................... 16 Running Head: FRAUD IN NOT-FOR-PROFITS vii Assumptions, Limitations, Delimitations ......................................................................... 19 Assumptions .......................................................................................................... 19 Limitations ............................................................................................................ 21 Delimitations ......................................................................................................... 23 Significance of the Study .................................................................................................. 24 Reduction of Gaps................................................................................................. 24 Implications for Biblical Integration ..................................................................... 25 Relationship to Field of Study .............................................................................. 26 Summary of the significance of the study............................................................. 27 A Review of the Professional and Academic Literature ................................................... 27 Fraud ..................................................................................................................... 28 Main element 1. .................................................................................................... 51 Main element 2. .................................................................................................... 56 Main element 3. .................................................................................................... 62 Potential themes and perceptions. ......................................................................... 68 Summary of the literature review. ........................................................................ 70 Transition and Summary of Section 1 .............................................................................. 71 Section 2: The Project ....................................................................................................................73 Purpose Statement ............................................................................................................. 74 Role of the Researcher ...................................................................................................... 74 Participants .......................................................................................................................
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