Beneish Model for the Detection of Tax Manipulation: Evidence from Slovakia
Beneish Model for the Detection of Tax Manipulation: Evidence from Slovakia
Author(s): Tomáš Bačo, Eduard Baumöhl, Matúš Horváth, Tomáš VýrostSubject(s): Accounting - Business Administration, Corruption - Transparency - Anti-Corruption
Published by: Ekonomický ústav SAV a Prognostický ústav SAV
Keywords: earnings manipulation; Beneish model; accounting fraud; Slovakia; corporate governance;
Summary/Abstract: To test the usefulness of the Beneish model, we use a unique, not publicly available database from the Financial Administration of the Slovak Republic, aggregating the results of all on-site financial inspections conducted by this authority during 2015 – 2019. This database is paired with firm-level accounting data from the Registry of Financial Statements and the Business Register to obtain additional corporate governance data. Our results indicate that (a) the performance of the Beneish model is inferior for the Slovak data; (b) there are several significant financial variables with statistical and economic significance, but their relevance is conditional on the industry group; and (c) corporate governance indicators appear to be more relevant preventive factors of fraudulent behavior, especially foreign ownership, female CEO and corporate social responsibility.
Journal: Ekonomický časopis
- Issue Year: 71/2023
- Issue No: 03
- Page Range: 185-201
- Page Count: 17
- Language: English