Open Access
Review
SciPap-1975
Fraudulent Financial Reporting in the Gray Area of Accounting: A Systematic Literature Review and Future Research Directions
by
Falsa Dzaky Arifian 1,* 
and Anis Chariri 2
1 Department of Accounting, Universitas Diponegoro, Jl. Prof. Soedarto, SH, Tembalang, Semarang 50275, Indonesia
2 Department of Accounting, Universitas Diponegoro, Jl. Prof. Soedarto, SH, Tembalang, Semarang 50275, Indonesia
* Authors to whom correspondence should be addressed.
Abstract: This study aims to review research on fraudulent financial reporting (FFR) in the grey area of accounting with a systematic literature review approach and bibliometrics analysis. The study was conducted on 74 research articles from the Scopus database. The gray area comprises discretionary accruals, real earnings management, and FFR detection models. This study synthesizes FFR research characteristics, topic developments, key research streams, and future research directions. There are differences in characteristics between research in the gray area and misconduct in the form of research subjects, research objectives, and countries where the research is conducted. The topic development began with utilizing financial ratios as detection tools until various FFR detection methods emerged. The key research streams encompass six main discussions. Several directions for future research, including investigations into the differences in FFR enforcement between developed and emerging countries, studies on real earnings management from behavioral perspectives, exploration of the novel detection methods, and meta-analysis on the Beneish M-score model. Several reviews of FFR have predominantly concentrated on fraudulent organizations, neglecting the exploration of the gray area. This research contributes to other researchers by providing a roadmap for FFR research in the gray area of accounting.
Keywords: Earnings Management, Systematic Literature Review, Fraudulent Financial Reporting, Restatement, Beneish M-Score, Gray Area, Bibliometrics Analysis
JEL classification: M41 - Accounting, M42 - Auditing
Received: 7 May 2024 / Revised: 2 April 2025 / Accepted: 6 May 2025 / Published: 30 May 2025
