Effectiveness of Red Flag: Indian Auditors’ Perception

Abstract

Red flags are the warning signal against occurrence of any act of wrongdoing. Early identification of red flags helps to avoid or minimize fraud losses. Thus, the present study aims to investigate auditors'perception towards the effectiveness of red flags in identifying corporate fraud. To achieve the objective of the study, data has been collected from Indian auditors through a questionnaire. The findings of the study confirm that auditors perceive rationalization as the most influencing category which was followed by opportunity and pressure.