Issue |
SHS Web Conf.
Volume 129, 2021
The 21st International Scientific Conference Globalization and its Socio-Economic Consequences 2021
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Article Number | 03037 | |
Number of page(s) | 9 | |
Section | Financial Management and Financial Markets | |
DOI | https://doi.org/10.1051/shsconf/202112903037 | |
Published online | 16 December 2021 |
Could globally used Beneish M-score predict the manipulation of the accounting statements in the Slovak republic?
University of Zilina, Faculty of Operation and Economics of Transport and Communications, Univerzitna 1, 010 26 Zilina, Slovakia
* Corresponding author: katarina.zvarikova@fpedas.uniza.sk
Research background: Globalization is characteristic by many companies which are doing their business worldwide in various tax policies, so they are able to use the possibilities of creative accounting for their own benefit. And although the term creative accounting is concerned mainly with multinational companies, it is not an unknown technique also for local companies.
Purpose of the article: The PwC’s Global Economic Crime and Fraud Survey proved that economic crime is constantly evolving worldwide. At present, there is a huge number of frauds, which include corruption, misappropriation of assets, or fraudulent reporting. These papers are focused only on accounting fraud and creative accounting as the way to adjust accounting books and reports.
Methods: The aim of the papers is to analyse the detection ability of the Beneish M-score model in the specific condition of the Slovak republic. These specific conditions consider tax minimization as the key factor for creative accounting implementation. The analysis was made with a Slovak company that was legally convicted of intentional manipulation of the accounting statements.
Findings & Value added: The consideration of the specific condition in M-score for Slovak republic showed the best detection ability to reveal the frauds. As our study reveals, reduced M – score5 was unreliable in the condition of the Slovak republic and although Beneish consider 3 indicators as redundant it seems that in the condition of the Slovak republic it is important to carefully consider their implementation.
Key words: Beneish M-score; / creative accounting; / manipulation of the accounting; / fraudulent reporting; / the Slovak republic
© The Authors, published by EDP Sciences, 2021
This is an Open Access article distributed under the terms of the Creative Commons Attribution License 4.0, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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