The study sought to apply both the 5 and 8 variables Beneish model to detect the likelihood of fraud in the financial statements of listed banks in Ghana. The study is purely a quantitative descriptive study. The study covers 8 listed banks in Ghana. The study covers 2015-2019. First, the …
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The study sought to apply both the 5 and 8 variables Beneish model to detect the likelihood of fraud in the financial statements of listed banks in Ghana. The study is purely a quantitative descriptive study. The study covers 8 listed banks in Ghana. The study covers 2015-2019. First, the 5-variables Beneish model identifies 4 banks (representing 50%) of been engaged in financial statement fraud. Second, the results based on the eight (8) – variables Beneish model postulate that three (3) listed banks out of the eight (8) were more likely to be engaged in financial statement fraud. Third, the binary logistics regression based on the 5-variables Beneish model revealed that GMI (Gross margin index) and AQI (Asset Quality Index) have a significant negative relationship with financial statement fraud. Fourth, the binary logistics regression based on the 8-variables Beneish model revealed that DSRI (Day’s sales receivables index), Sales growth index, and total, accruals to total assets index have significant negative relationship with financial statement fraud. The study, therefore, that financial statement fraud is prevailing in the banking sector in Ghana. The study recommends that banks, the Bank of Ghana, the Security and exchange commission, and other policymakers should identify the 5-variabels and 8-variables Beneish model as a useful tool for financial statement fraud detection.
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