The Interaction Effect of Personality Factor on Capability and Competence Requirement

The auditing and accounting profession recently faced many challenges following fraudulent practices among the Jordanian public sector. The continuation of such fraudulent activities in the public sector impedes national economic developments and growth. This study's main objective is to have a practical and effective way of reducing the incidences of fraud in the Jordanian public sector. Specifically, this research explores the moderating role of neuroticism on knowledge requirements and fraud risk assessment performance in the Jordanian public sector. Adopting a survey method, the respondents of this study are forensic accountants and auditors in the Jordanian public sector. The research findings will contribute to the existing literature on forensic accountants, auditors, knowledge capability requirement, and neuroticism as a personality factor and fraud risk assessment performance of regulators regarding prevention and detection of fraud in the Jordanian public sector work environment.


Introduction
In the last 25 years since the Enron crisis, the main issue in economies and countries was the prevention of fraud and corruption. It has also become an essential requirement for Fraud is still widespread in Jordan and the continuing serious financial collapses, for instance, the Petra Bank embezzlement crisis resulted in the loss of certain JD200 million (USD670 million). This crisis contributed to a decrease in the financial strength of the country which led to the depreciation of the Jordanian Dinar (1JD = USD 3.35 to USD 1.41) after this crisis; which also led to more failures of companies and increased country unemployment (Zureigat, 2015;Al-Awaqleh, 2008).
Fraud Risk Assessment (FRA), one of the components of the internal control, indicates not only the course of accounting and audit but assists auditors and forensic accountants in ascertaining organisational conditions and the extent of the audit, which are arranged to prevent, deter, and respond to fraud (COSO, 2019). Consequently, in response to the audit process, FRA is directly linked to the auditors' capability to detect and prevent fraud (Mansour et al., 2020;Popoola et al., 2015;Popoola, 2014;Chui, 2010).
For forensic accountants and auditors to be effective and efficient, they need to gain more specialised knowledge, improved abilities, and fraud-related mentality (Salleh et al., 2019;Howieson, 2018;Bhasin, 2015;DiGabriele, 2008). Improvement of the ability requirement is vital to significantly influence changing perceptions and understanding of fraud schemes and the effects of fraud in the public-sector environment. However, the latest studies have shown that it is not easy and simple for auditors to detect fraud as companies sometimes take steps to mask fraud through deliberate means (DeZoort & Harrison, 2018;Knapp & Knapp, 2001). Ashton (1999) suggested that certain personality factors are individual predictive performances (i.e. fraud risk assessment), and various elements related to the essential aspects of the big-5 factors. The big-5 factors are "agreeableness, extraversion, conscientiousness, openness to experience, and neuroticism" (Goldberg, 1990). The current study assumes that highly neurotic forensic accountants and auditors would not perform well in their employment as opposed to forensic accountants and low-neuroticism auditors. The ISSN 2162-4860 2021 reason addressed is that people with high-level neuroticism continue to display negative attitudes such as fear, depression, lack of courage, and anxiety. When such attitudes are demonstrated, the current research assumes that forensic accountants and auditors might not be willing to prevent and detect fraud appropriately. Therefore, the present study suggested that a forensic accountant or high-level auditor with neuroticism will decrease the interaction among the capability to assess fraud risk task and the knowledge requirement of forensic accountants and auditors in any fraud circumstances because neurotic persons put themselves into conditions that encourage negative effect. Based on prior literature, it is evident that there are corrupt practices and fraud in the Jordanian public sector. The growth in fraud necessitates the need to carry out this research to examine the moderating effect of neuroticism on FRAP and knowledge requirements in Jordan"s public sector.

Business and Economic Research
The current research paper is organised as follow; Section 2 of this paper covers the literature review of fraud, internal control concept, the competency requirement (fraud risk assessment performance), capability requirement (knowledge) and neuroticism as personality factors; Section 3 presents the conceptual and theoretical framework of this study; Section 4 shows the Hypothesis Development, and; The conclusion of this research is exposed in Section 5.

Fraud Concept
In 2009, The Chartered Institute of Management Accountants (CIMA) defined "fraud" as "all activities such as fraud by robbery, fraud by conspiracy, money laundering, bribe, and properties obtaining". Hopwood, Leiner, and Young (2012) defined "fraud" as "the intention to cheat to get assets from the victims". While Singleton et al. (2006) demonstrate that "fraud" is the "behaviour of human beings in the way of cruel and defalcation, immorality, illegality, or have an intention to avoid the laws, including any actions against the positions, responsibilities, and other rights", and Klitgaard (1988) and Heywood (1997) identified that "corruption" is "a behaviour that deviates from regular responsibilities of the public services for private benefits by violating the rules and regulations with the abuse of power". In conclusion, fraud and corruption mean the swindle, deception, cheat, misappropriation, or intention to cause misunderstanding for seeking benefits both in terms of financial and nonfinancial to acquire the gains on position, power, money, property, or legal right toward oneself and companion from the organisation which that person works. This is following the theoretical concept of human needs (Need Theories) of Maslow (1943), it depends on each individual"s behaviour through five aspects which are as follows: "(1) physiological needs, (2) safety needs, (3) belongingness and love needs, (4) esteem needs, and (5) self-actualisation needs". This explains all human beings struggle and fight for their own goals.

Internal Control Concept
Internal Control means the operating system organised within the organisations to reduce the potential risks from fraud, and it might cause damages to the properties of the organisation. Organising a good internal control system is essential for enhancing the operations to achieve organisational conduction goals, both in contexts of efficiency and effectiveness, including ISSN 2162-4860 2021 constructing the reliability of the financial report. Furthermore, internal control includes the following laws and related rules and regulations to prevent fraud or resources misuse, which will reduce the possible mistakes from all operational activities (Clinton, Pinello, and Skaife, 2014). It consists of 5 elements as follows: "(1) Control Environment (2) Risk Assessment (3) Control Activities (4) Information and Communication and (5) Monitoring" as shown in Figure 1. In 2013, the Committee of Sponsoring Organisations of the Treadway Commission (COSO) developed the guidelines of internal control and investigation by increasing the intensity of the analysis and risks from five factors previously to eight factors focusing on the behavioural analysis of the wrongdoer on fraud based on Fraud Triangle concept by Cressey. Cressey (1953, 1951 revealed that "the fraud behaviours are caused by three motivation, which includes incentive/pressure, opportunity, and attitudes/rationalisation. Singleton et al. (2006) said that if an organisation has a weakness in the internal control systems, it will open up the opportunity to fraud.

Capability and Competence Requirements
The International education standard No 8, Competence requirements for audit professionals produced by the IAESB, an organ of the IFAC suggests requirements for accountants who assume the audit professional"s role and also who have the responsibility to make essential judgments in audit of historical financial information in specific working environments and industries (IFAC-IES, 2006). Capability defined as "the professional knowledge, professional skills, professional values, ethics, and attitudes required to demonstrate competence" (IFACIES 8.8, 2006). This standard also explains "capability" to mean the attribute of persons who can play their tasks at work environment efficiently. The term capability comprises "content knowledge, technical and functional skills, behavioural skills, intellectual abilities Business and Economic Research ISSN 2162-4860 2021 (including professional judgements) and professional values, ethics and attitudes" (WAC-ES 8, 2006). Competence is defined as the actual demonstration of performance. Also, it relates to the capability to do work tasks in the actual working environment according to a defined standard (IFAC-IES 8.8, 2006).

Fraud Risk Assessment Performance FRAP
According to COSO framework components and principles, their indicators are considered essential for risk assessment (COSO, 2019 p.6). The component and principle of risk assessment are: "1) specifies suitable objectives, 2) Identifies and analyses risk, 3) Assesses fraud risk, and 4) Identifies and analyses significant change". FRAP is "a complex process carried out by auditors that require advanced cognitive knowledge and skills" (Desai & Gupta, 2016). Fraud risk assessment (FRA) helps an auditor to understand the complexity of the audit processes needed to increase the likelihood of detecting fraud (Wuerges, 2011;Bloomfield, 1997). Regrettably, prior studies have presented that auditors are typically not adequately capable of assessing fraud risk, therefore, cannot detect fraud in a financial statements audit (Asare et al., 2015;Wuerges, 2011;Allen et al., 2006). Following "the Statement on Auditing Standard (SAS) No. 99, Consideration of Fraud in a Financial Statement Audit", auditors of U.S. Government companies are required to execute FRA as part of audits of the financial statements to avoid material financial errors Victoravich, 2010).
According to the American Institute of Certified Public Accountants (AICPA) in "Managing the Business Risk of Fraud: A Practical Guide" (2009) "An efficient FRA ought to determine where fraud might happen and who the perpetrators might be. Therefore, control activities should always consider both the fraud scheme and the individuals within and outside the organisation who could be the perpetrators of each scheme. If the scheme is collusive, preventive controls should be augmented by detective controls, as collusion negates the control effectiveness of segregation of duties".
In addition, FRA is considered as a useful method for prevention of fraud, accordingly, was endorsed to improve auditor"s competence in the quest for fraud prevention and detection (Mansour et al., 2020;Baz et al., 2016;Payments, 2015;Subramanian, 2014;Knapp & Knapp, 2001). For this study, FRA performance is defined as the forensic accountant and auditor"s capability to access fraud risk to prevent and detect fraud within the public sector's working environments.

Knowledge Requirement
Knowledge of forensic accounting includes "professional responsibilities and practice management, laws, courts and dispute resolution, planning and preparation, information gathering and preservation (documents, interviews or interrogations, electronic data), finding, reporting, experts and testimony" (Lessambo, 2018;Popoola et al., 2015;Popoola et al.,2014;Davis et al., 2010;Durkin & Ueltzen, 2009). Seven fields are defined as a component of specialised knowledge in forensic accounting, according to "the American Institute of Certified Public Accountants" (Davis et al., 2010). These areas comprise "fraud prevention, ISSN 2162-4860 2021 detection and response, computer forensic analysis, family law, valuation, financial statement misrepresentation, economic damages calculations, and bankruptcy, and insolvency and reorganisation" (AICPA, 2011; Durkin and Ueltzen, 2009). The current research paper includes fraud detection, prevention, and response to highlight the potential failure to manage Jordan's accounting and auditing systems. A forensic accountant must have the necessary resources to detect fraud built on his education and training on communications, legal and criminology, information technology, and investigation (Popoola, Che-Ahmad & Samsudin, 2015;Davis et al., 2010).

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Recent studies have shown that individuals with specialised knowledge in the use of information technology, legal investigative criminology and accounting would be useful at documenting and processing reports, reviewing financial statements, questioning and acting as professional witnesses than individuals in auditing (Hopwood et al., 2012;Singleton et al., 2006). The International Education Standard No 8, Competence Requirements for Professional Accountants, identifies the auditors' knowledge capability to include "historical financial information audit at a higher level, financial accounting and reporting at a higher standard, and information technology" (IFAC, 2019).
This research agrees with the Association of Certified Fraud Examiners (ACFE) that standard-setter statements are not appropriate for identifying fraud (ACFE, 2018). Popoola (2014) noted that the identification and reaction of fraud prevention is not just a piece of cake and requires much more than the explanations in IES No. 8, Audit Professional Competence Requirements (IFAC, 2019).

Neuroticism as a Personality Factor
Over the current century, previous literature, and analyses from across several nations and cultures have addressed the impact of Big-5 personality as the most powerful impact on task performance to explain how personality traits can impact task performance. Over the years, studies have defined several personality factors that may reflect person traits (McCrae & Terracciano, 2005;McCrae & Costa, 1997). For instance, the Big-5 personality ("extraversion, neuroticism, conscientiousness agreeableness and openness to experience") represents individual interactions and behavioural response in a different environment, for example, task performance (Trouba, 2009;Vakola et al., 2004).
As per McCrea and John (1992), neuroticism signified individual differences in the inclination to experience distress and the cognitive and behavioural styles that follow from this tendency. They stated that neuroticism highlights anxious, self-pitying, tense, sensitive, unbalanced, and worrying behaviours. Goldberg (1993) ISSN 2162-4860 2021 individual characteristics such as anxiety, emotional instability, and tempera.

Business and Economic Research
The Big-5 factors of personality have been investigated in many studies, including vigilance performance and workload. Rose et al. (2002) found that neuroticism was linked to perceived frustration in terms of perceived workload. Prior researches provided inconsistent results on the impact of neuroticism as a personality factor on individual performance (e.g. Mansour et al., 2020;Gullkvist & Jokipii, 2015;Jaffar et al., 2011;Zimbelman & Waller, 1999;Bernardi, 1994;Pincus, 1984). Current research assumes that forensic accountants and auditors with high neuroticism will not perform efficiently and effectively in their work matched to those with low neuroticism as those with high-level neuroticism appear to have negative attitudes. This research assumes that the auditors might not be capable to effectively detecting the risk of fraud if such attitudes are demonstrated.

Conceptual Framework of the Study
A conceptual framework relates to a structure of rules, assertions and principles that incorporates ideas about a particular concept (Mugenda & Mugenda, 2003). The conceptual framework is intended to explore the moderating effect of neuroticism, the forensic accountants, and auditor"s knowledge capability on FRAP in the Jordanian public sector. Figure 2 presented the research framework of this paper.

Knowledge Requirement and Fraud Risk Assessment Performance
First conceptual connection in the current research is the knowledge requirement effect on the FRAP. As stated by International Education Standard No. 8, competency requirements for audit professionals, auditor"s knowledge is divided into three: (1) higher-level of historical financial information analysis, (2) higher-level financial accounting and monitoring, and (3) IT. (IFAC-IES, 2019). This research paper agrees with Daniel and Lee (2006) that the charts may be looked at by other accountants, but forensic accountants look deep into the body. Prior studies, suggested that a modest change in knowledge capability produces considerable changes in performance and possess an imposing impact on person"s resolve, assertiveness, and commitment to achieve set objectives (Mansour et al., 2020;Popoola et al., 2015; Knowledge Requirements Neuroticism as a Personality Factors ISSN 2162-4860 2021, Vol. 11, No. 1 Hopwood, Leiner, and Young, 2012Davis, Farrell & Ogilby, 2010;Di-Gabriele, 2008;Messmer, 2004;Haris & Brown, 2000). The current study proposes the following hypothesis: H1: There is a relationship between knowledge requirement and fraud risk assessment performance in the Jordanian public sector.

Neuroticism and Fraud Risk Assessment Performance
The second conceptual relation in the current study is the influence of neuroticism as a personality factor on FRAP. Neuroticism is a dimension of big-five factors that tend to experience adverse impacts like fear, sorrow, confusion, irritation, fault, and loathing. Some kinds of psychiatric problems may be at risk for high level. A high level of neuroticism indicates that individuals are vulnerable to illogical beliefs are less capable of controlling urges and poorly to deal with stress. A low level of neuroticism shows emotional stability. Usually, such people are generally calm, quiet, confident, and capable of handling stressful situations without getting upset (Warrington, 2017;Rothmann & Coetzer, 2003;Hough et al., 1990).
The previous study found neuroticism as a forecaster of performance in different professions (Tuteja & Sharma, 2016;Hörmann & Maschke 1996). Dunn, Mount, Barrick, and Ones (1995) indicated that the second most important feature affecting candidates ' employability is emotional stability (the opposite of neuroticism). A recent study stated that neuroticism is backwards linked to task performance (Terrier, Kim, and Fernandez, 2016;Judge Higgins, Thoresen, and Barrick, 1999). However, Salgado (1997), in certain circumstances, argued that neuroticism predicts job performance. This study proposes that forensic accountants and auditors' high neurotic behaviour would not be capable of performing effectively in their work matched to those with lower neuroticism as those with a high level of neuroticism tend to have negative attitudes. The present study proposes the following hypothesis: H2: There is a relationship between neuroticism and fraud risk assessment performance in the Jordanian public sector.

The Moderating Effect of Neuroticism on Knowledge Requirements and Fraud Risk Assessment Performance
The third conceptual link in this research is the interaction effect of neuroticism between knowledge (forensic accountants and auditors) and FRAP. The impact of neuroticism on performance is found to have mixed results (e.g. Mansour et al., 2020;Gullkvist & Jokipii, 2015;Jaffar et al., 2011;Zimbelman & Waller, 1999;Bernardi, 1994;Pincus, 1984). The current study posits that forensic accountants and auditors with a highly neuroticism would not perform effectively in their work than those with a lower neuroticism level, as those with high neuroticism appear to have negative attitudes. Thus, the current research suggests that a high level of neuroticism would reduce the relationship between knowledge (capability requirements) and assess fraud risk in any fraud situation. This research, therefore, postulates thus: H3: Neuroticism positively moderates the relationship between knowledge requirement and Business and Economic Research ISSN 2162-4860 2021 fraud risk assessment performance in the Jordanian public sector.

Research Methodology
This study plans to employ a quantitative approach through a survey to test the hypothesis. A questionnaire is developed to be distributed to forensic accountants and auditors from the Audit Bureau and Integrity and Anti-Corruption Commission in Jordan. The study will use the Statistical Package for Social Sciences (SPSS) version24 as a data analysis technique (Zikmund & Griffin, 2013) and Structural Equation Modelling Partial Least Squares (SEM-PLS) for data analysis to determine the overall predictive quality or relevance of the model, confirmatory factor analysis (CFA), amongst others (Hair et al., 2014).

Conclusion
This research investigated the moderating influence of neuroticism as a personality factor on the association among knowledge of (forensic accountants and auditors) FRAP in the public sector in Jordan, having expanded on the issue statement and research objectives. The research helps to understand forensic accounting processes of fraud detection, improved fraud mediation, and reactions on the environment of the public sector. In addition, the relevant literature on the capability requirements of forensic accountants and auditors and the moderating influence of neuroticism as a personality factor in the Jordanian public sector's FRA and capability requirements are reviewed. This research paper offers a conceptual framework that could be used to deter and detect fraud by forensic accountants and public sector auditors. The current research is theoretical in nature, and thus, more empirical research on this topic needs to be undertaken to determine the importance of FRAP.