Journal Articles

The Detection of Earnings Manipulation

1999, Financial Analysts Journal

Messod D Beneish


A profile of sample earnings manipulators, their distinguishing characteristics, and a suggested model for detecting manipulation are presented. The model's variables are designed to capture either the financial statement distortions that can result from manipulation or preconditions that might prompt companies to engage in such activity. The results suggest a systematic relationship between the probability of manipulation and some financial statement variables. The evidence is consistent with the usefulness of accounting data in detecting manipulation and assessing the reliability of reported earnings.


Beneish, Messod D. (1991), "The Detection of Earnings Manipulation," Financial Analysts Journal, Vol. 55, No. 5, pp. 24-36.

Kelley School of Business

Faculty & Research