ESTIMATION FINANCIAL INFORMATION MANIPULATION BY NEGATIVE BINOMIAL HURDLE MODEL

Abstract

Manipulation is one of the important issues in securities markets because manipulative actions send false signals to investors and make them buy or sell securities. There are different types of manipulations that can deceive investors, one type of which called financial information manipulation. Manipulators, who use this kind of manipulation, distort information on financial statements in order to give false information about the prospects of the issuing firms. The aim of the manipulators is to deceive the investors and gain advantage at their expense. In this study, it is aimed to develop an appropriate model in order to determine the factors affecting the number of companies which has published false financial statements at Istanbul Stock Exchange in 2010 year. Zero-inflated count data is analyzed with Negative Binomial Hurdle Model in order to determine the effective financial ratios.

Keywords

• Financial Information Manipulation ,Negative Binomial Hurdle model, Caunt data

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