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Toshiba Corp

A Forensic Analysis Tool for Detecting Accounting Red Flags: Focus on Developed Asia

1.3k Views29 Feb 2020 20:22
SUMMARY

In this Smartkarma Original, we bring to you a forensic analysis tool that scores companies across Developed Asia on their accounting risk. We use 25+ accounting parameters in our framework to come up with an accounting risk score. Our tool is based in Excel and is linked dynamically to Capital IQ for fetching latest data.

Insight Flow

  1. Forensic Analysis Framework
  2. Excel Model
    1. How to Download and Use the Tool
    2. Steps to Run the Model
  3. Target Universe
  4. Companies with Highest Accounting Risk
  5. Summary Statistics from our Analysis
  6. Key Model Limitations and Risks
  7. Appendix
    1. List of Companies in our Target Universe with Accounting Risk Score >= 8
    2. Glossary
    3. Snapshot of Capital IQ Screener Used for Filtering Universe
    4. Switch Formula Calculation Option in Excel
    5. Refresh Worksheet Option in Capital IQ Plugin

What's Original?

Over time with experience and taking cues from past financial shenanigans, we have developed a proprietary quantitative framework for identifying accounting irregularities. This framework comprises of 25+ accounting parameters and takes into account 10 years of historical data to assess the quality of accounting.

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Ankit Agrawal, CFA
Equity L/S Analyst | Forensic Accounting | India
Yellowstone Equity
IndiaEquity Bottom-UpForensic Accounting
  • A Forensic Analysis Tool for Detecting Accounting Red Flags: Focus on Developed Asia
    29 Feb 2020
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