Dr. Chetana R. Marvadi


In the business environment, rms are expected to disclose accurate and reliable nancial information.
Financial statement fraud is actions which are taken to intentionally distort a company's reported
nancial performance. Major corporate nancial statement Frauds get away in the name of creative accounting. But, they need
to be studied for lessons learned and strategies to avoid or reduce the incidence of such frauds in the future. It is essential for
shareholders, particularly the common man who does not have any access to the company except reported nancial numbers.
This research paper attempts to detect the practices of nancial statement fraud in the Pharmaceutical Sector in India for
investors' interest using Earnings quality, De Angelo and Beneish models of fraud detection. The result conrms the presence of
nancial statement fraud in the companies under study. It is therefore expected that the study will help to improves investor's
belief of a company's performance, as reected in their nancial numbers.

Full Text:



American Accounting Association (1969) “Committee on External Reporting. An Evaluation of External Reporting Practices”, A Report of the 1966-68 Committee on External Reporting, The Accounting Review, Supplement:79-123

Bistrova, J. & Lace, N. (2012) “Quality of corporate governance system and quality of reported earnings: evidence from CEE Companies”, Economics and Management, vol. 17, no. 1

Beneish, M.D. (2001) “Earnings Management: A Perspective”, Managerial Finance, vol. 27, no. 12: 3-17

Li, Feng & Abeysekera, Indra & Abeysekera, F. (2011). Earnings management and the effect of earnings quality in relation to stress level and bankruptcy level of Chinese listed firms. Corporate Ownership and Control. Volume 9, Issue 1, 2011,

Sandeep Goel (2012) “Demystifying Earnings Management through Accruals Management in India” Volume 37, No 1, January-March 2012.

Sandeep Goel (2013): “Decoding Gimmicks Of Financial Shenanigans in Telecom Sector in India”, Accounting and Management Information Systems Vol. 12, No. 1, pp. 118–131, 2013

Normah Omar, RidzuanKunjiKoya, ZuraidahMohdSanusi, and NurAimaShafie(2014),”Financial Statement Fraud: A Case Examination Using Beneish Model and Ratio Analysis”, International Journal of Trade, Economics and Finance, Vol. 5, No. 2, April 2014


  • There are currently no refbacks.