Detection of fraud in companies in the Republic of Serbia using the Beneish model

Detection of fraud in companies in the Republic of Serbia using the Beneish model

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The aim of this paper is to point out the necessity of introducing additional levels of quality control over financial reporting in the Republic of Serbia.The existing levels of control (internal, external and state audit, click here and tax control) are not sufficient to prevent and detect fraud in the operations of companies.Numerous cases of fraudulent behaviour in the previous period have provided evidence supporting this assumption.Practice has shown that forensic accounting should necessarily be introduced as the level of control with sufficient legal powers enabling a more detailed investigation of fraud.For this reason, this paper deals with the fraudulent cases in certain companies in the Republic of Serbia, in order to confirm or disprove the hypothesis that the fraud could have been detected earlier or could even have been prevented if the methods turbo air m3f24-1 of forensic accounting had been applied.

For this purpose, we employed Beneish model to assess the probability of possible fraud in financial statements.