Proceedings of the 2022 2nd International Conference on Economic Development and Business Culture (ICEDBC 2022)

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

Authors
Ruixuan Zhou1, *, Jiani Yin2, Yuanheng Feng3, Chenlin Xu4, Runhe Zhu5
1Division of Business and Management, Beijing Normal University - Hong Kong Baptist University United International College, Zhuhai, 519087, Guangdong, China
2Shenzhen Middle School, Shenzhen, 518024, Guangdong, China
3School of Business and Tourism Management, Yunnan University, Kunming, 650500, Yunnan, China
4International College, Huaqiao University, Quanzhou, 362021, Fujian, China
5Kimball Union Academy, State of Connecticut 03770, Meriden, USA
*Corresponding author. Email: q030006270@mail.uic.edu.cn
Corresponding Author
Ruixuan Zhou
Available Online 31 December 2022.
DOI
10.2991/978-94-6463-036-7_115How to use a DOI?
Keywords
Financial reporting fraud; Chinese companies listed in the U.S.; Fraud detection models
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.

Copyright
© 2022 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the 2022 2nd International Conference on Economic Development and Business Culture (ICEDBC 2022)
Series
Advances in Economics, Business and Management Research
Publication Date
31 December 2022
ISBN
10.2991/978-94-6463-036-7_115
ISSN
2352-5428
DOI
10.2991/978-94-6463-036-7_115How to use a DOI?
Copyright
© 2022 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Ruixuan Zhou
AU  - Jiani Yin
AU  - Yuanheng Feng
AU  - Chenlin Xu
AU  - Runhe Zhu
PY  - 2022
DA  - 2022/12/31
TI  - Detection of Fraud Statement Using Calculation Models M-Score and F-Score: Evidence from Chinese Companies Listed in the United States
BT  - Proceedings of the 2022 2nd International Conference on Economic Development and Business Culture (ICEDBC 2022)
PB  - Atlantis Press
SP  - 780
EP  - 790
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-036-7_115
DO  - 10.2991/978-94-6463-036-7_115
ID  - Zhou2022
ER  -