Relationships Between the Beneish M-Score and Bankruptcy Models: Insights from Financial Models in Czech Manufacturing Firms

Result code in IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F60076658%3A12220%2F25%3A43910251" target="_blank" >RIV/60076658:12220/25:43910251 - isvavai.cz</a>

Alternative codes found

RIV/60076658:12510/25:43910251

Result on the web

<a href="https://hrcak.srce.hr/342820" target="_blank" >https://hrcak.srce.hr/342820</a>

DOI - Digital Object Identifier

<a href="http://dx.doi.org/10.18045/zbefri.2025.2.7" target="_blank" >10.18045/zbefri.2025.2.7</a>

Result language

angličtina

Original language name

Relationships Between the Beneish M-Score and Bankruptcy Models: Insights from Financial Models in Czech Manufacturing Firms

Original language description

&quot;Many well-known cases worldwide demonstrate that even if companies appear financially strong, their actual accounting reality may differ. Uncovering fraudulent behaviour is difficult, so auditors, financial authorities, stock exchanges, etc., must detect and eliminate it. This paper aims to determine the relationship between the Beneish M-score model and two bankruptcy models, Altman’s Z-score and theCzech IN05 model. It verifies if there are significant differences in how these models classify firms, and whether the Beneish model aligns with them. The application part focuses on the 3,568 firms from the Czech manufacturing industry between 2015 and 2022, and uses the Bowker test for symmetry, working with paired data. The Beneish model showed that 34% of enterprises are at risk of fraud. The results of the analyses further confirmed the existence of systematic andstatistically significant differences between the classifications of companies according to the Beneish model and the bankruptcy models Alman Z-Score and IN05. Therefore, if companies tend to go bankrupt, it is not possible to determine whether they will tend to manipulate statements or not. Similarly, a tendency to manipulate financial statements cannot be demonstrated in companies with good financial health.&quot;

Czech name

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Czech description

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Type

J_imp - Article in a specialist periodical, which is included in the Web of Science database

CEP classification

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OECD FORD branch

50202 - Applied Economics, Econometrics

Project

—

Continuities

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Publication year

2025

Confidentiality

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Name of the periodical

Zbornik Radova Ekonomskog Fakulteta u Rijeci-Proceedings of Rijeka Faculty of Economics

ISSN

1331-8004

e-ISSN

1846-7520

Volume of the periodical

43

Issue of the periodical within the volume

2

Country of publishing house

HR - CROATIA

Number of pages

20

Pages from-to

465-884

UT code for WoS article

001654791400007

EID of the result in the Scopus database

2-s2.0-105027422910