Journal of Financial Services Research 59, pp. 115-142.
ISSN/ISBN: Not available at this time. DOI: 10.1007/s10693-020-00334-9
Abstract: We utilise Benford’s Law to test if balance sheet and income statement data broadly used to assess bank soundness were manipulated prior to and also during the global financial crisis. We find that all banks resort to loan loss provisions to manipulate earnings and income upwards. Distressed institutions that have stronger incentives to conceal their financial difficulties resort additionally to manipulating loan loss allowances and non-performing loans downwards. Moreover, manipulation is magnified during the crisis and expands to encompass regulatory capital.
Bibtex:
@article{,
author = {Grammatikos, Theoharry and Papanikolaou, Nikolaos I.},
title = {Applying Benford’s law to detect accounting data manipulation in the banking industry},
year = {2021},
journal = {Journal of Financial Services Research},
volume = {59},
pages = {115--142},
url = {http://eprints.bournemouth.ac.uk/33509/},
doi = {10.1007/s10693-020-00334-9},
}
Reference Type: Journal Article
Subject Area(s): Accounting