Detection of Fraud Statement Using Calculation Models M-Score and F-Score: Evidence from Chinese Companies Listed in the United States

Ruixuan Zhou (), Jiani Yin, Yuanheng Feng, Chenlin Xu and Runhe Zhu
Additional contact information
Ruixuan Zhou: Beijing Normal University - Hong Kong Baptist University United International College, Division of Business and Management
Jiani Yin: Shenzhen Middle School
Yuanheng Feng: Yunnan University, School of Business and Tourism Management
Chenlin Xu: International College, Huaqiao University
Runhe Zhu: Kimball Union Academy, State of Connecticut 03770

A chapter in Proceedings of the 2022 2nd International Conference on Economic Development and Business Culture (ICEDBC 2022), 2022, pp 780-790 from Springer

Abstract: ABSTRACT In recent years, the cases of financial fraud within China’s listed companies in the U.S. have increased. Financial fraud usually fails to reflect the normal profitability of enterprises and harms the interests of small and medium investors, disturbing the normal operation of the market as a result. The goal of this study was to examine whether M-Score and F-Score models are fit for U.S.-listed Chinese Companies and to find clues to financial fraud of Chinese enterprises. To this end, we applied M-Score and F-Score models to 2 groups (14 samples) of companies from 5 different industries. There is a 13-year span between the earliest and latest allegations of financial fraud. The sample companies that have been caught in fraud were chosen to be the experimental group (EG) and the companies without committing fraud were selected to be the control group (CG). The findings suggest that M-Score model fits the U.S.-listed Chinese companies, while there is insufficient evidence to prove that F-Score model can be applied.

Keywords: Financial reporting fraud; Chinese companies listed in the U.S.; Fraud detection models (search for similar items in EconPapers)
Date: 2022
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-036-7_115

Ordering information: This item can be ordered from
http://www.springer.com/9789464630367

DOI: 10.2991/978-94-6463-036-7_115

Access Statistics for this chapter

More chapters in Advances in Economics, Business and Management Research from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().