<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>Understanding the factors that cause fraud and properly defining key areas of conduct is one of the most effective ways to detect potential irregularities, where the auditor’s professional judgment and skepticism are essential. In this respect, it is necessary to study some key financial indicators, but also to use various procedures to identify and detect fraud and possible manipulation in the financial reporting process. The objectives are aimed at identifying and highlighting possible red flags in companies whose shares are traded on the Bucharest Stock Exchange. The sample considered sensitive to fraudulent financial reporting is composed of four distinct categories of companies, namely: companies recently admitted to trading on the AeRO market administered by the Bucharest Stock Exchange (21), companies that obtained a zero Vektor score in 2020 (9), companies that obtained a low score in the White Letter publication (5), and companies in insolvency (4).</p>
</abstract>

Understanding the factors that cause fraud and properly defining key areas of conduct is one of the most effective ways to detect potential irregularities, where the auditor’s professional judgment and skepticism are essential. In this respect, it is necessary to study some key financial indicators, but also to use various procedures to identify and detect fraud and possible manipulation in the financial reporting process. The objectives are aimed at identifying and highlighting possible red flags in companies whose shares are traded on the Bucharest Stock Exchange. The sample considered sensitive to fraudulent financial reporting is composed of four distinct categories of companies, namely: companies recently admitted to trading on the AeRO market administered by the Bucharest Stock Exchange (21), companies that obtained a zero Vektor score in 2020 (9), companies that obtained a low score in the White Letter publication (5), and companies in insolvency (4).

Red flags in financial reporting - empirical studies in the AeRO market

Faculty of Economics and Law, Department of Economic Sciences ED1

University of Medicine, Pharmacy, Science and Technology “George Emil Palade” of Targu Mures

University “1 Decembrie 1918” of Alba Iulia

Acta Marisiensis. Seria Oeconomica

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

{"article-title":"Red flags in financial reporting - empirical studies in the AeRO market"}

Understanding the factors that cause fraud and properly defining key areas of conduct is one of the most effective ways to detect potential irregularities,...

Red flags in financial reporting - empirical studies in the AeRO market

Data publikacji: 27 lut 2022

Zakres stron: 15 - 28

DOI: https://doi.org/10.2478/amso-2021-0002

Słowa kluczowe
Beneish model, fraudulent behaviour, financial reporting, AeRO market, Vektor, White Paper, insolvency, red flags, analytical procedures

© 2021 Tatiana Dănescu et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Red flags in financial reporting - empirical studies in the AeRO market

Data publikacji: 27 lut 2022

Zakres stron: 15 - 28

DOI: https://doi.org/10.2478/amso-2021-0002

Słowa kluczoweBeneish model, fraudulent behaviour, financial reporting, AeRO market, Vektor, White Paper, insolvency, red flags, analytical procedures

© 2021 Tatiana Dănescu et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Słowa kluczowe
Beneish model, fraudulent behaviour, financial reporting, AeRO market, Vektor, White Paper, insolvency, red flags, analytical procedures