Forensic Accounting: Impact of Fraud on Stock Price
Journal Title: International Journal of Business and Management Invention - Year 2019, Vol 8, Issue 1
Abstract
The business world is growing tremendously and the competition is therefore increasing proportionately. Unfortunately, excessive competition nowadays implies that the number of fraudulent activities which includes manipulation of accounting data, insider-trading, etc. are sky-rocketing. Due to this, recently the concept of forensic accounting has been gaining wide scale popularity in the field of finance. This paper attempts to analyze the impact of fraud announcements resulting from prudent forensic accounting investigations on the criminal company’s share price. This paper by the usage of multiple statistical tools, tries to compare the difference of this impact on the selected company’s which are belonging to different industries. For this purpose, 3 companies have been picked including Volkswagen (Automobile industry), Valeant Pharmaceuticals, which is now Bausch Health Companies Inc. (Pharmaceutical industries) and Toshiba (mainly Electrical and Electronics industry). A study is also made in this research to understand the effect of new privacy legislations on forensic accounting investigations. The findings in this paper can be used in predicting the possible downfall that a company could face due to illicit activities committed by it.
Authors and Affiliations
Rebekah Susan Mammen, Vinisha Verghese Edakalathur
Keywords
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