George Drogalas

The purpose of this study is the examination of the financial fraud in Greek companies, listed on the Athens Exchange for the period of 2008-2015 during the economic crisis in Greece. The data of all the listed companies that were used comprise financial statements, reviews in the reports by the auditors and the figures and information based on the reports of the Athens Exchange. A total of twelve companies were found and they comprise the primary research sample with fraud in their financial statements (FFS), while another twelve companies were employed as a control sample (non-FFS) for various comparisons. From thirty financial ratios, several statistical tests to the sample and the control sample are applied in order to create a model that will use ratios as “predictors” in the analysis of financial statements for fraud. The model is accurate in classifying the total sample correctly with accuracy rates exceeding 90 percent. The results demonstrate that the model functions effectively in detecting FFS in a period of economic crisis and could be used as a tool to the banking system, from internal and external auditors and taxation or other state authorities.

In the aftermath of the financial crisis, many companies have implemented extensive risk management procedures. Additionally, internal audit has increasingly attracted the attention of managers as it constitutes the core of modern corporate governance. However, regarding Greek companies, there is a lack of empirical research on factors that affect risk management. Therefore, the purpose of the present paper is to analyze specific factors associated with effective risk management. Primary data were collected using questionnaires distributed to employees in companies that are listed on the Athens Exchange. Multiple regression analysis was conducted in order to examine the relationship between effective risk management, risk based internal audit, internal auditors’ involvement in risk management and top management support. Our findings demonstrate that the above factors contribute positively to effective risk management.

An investigation was conducted to study a sample of 23 Greek firms listed on the Athens Stock Exchange that underwent mergers from 2011 to 2015, which is a period that embodies the Greek economic crisis. For the investigation, the authors use statistical tests to explore relative changes at twenty accounting ratios of the sample firms. These ratios are computed for one year before and after the merger. These ratios are found to be statistically insignificant indicating firms do not experience a post-merger improvement in accounting performance. The authors also examine six qualitative variables representing merger characteristics as past managerial decisions. Important findings for these characteristics include the following. First, for companies that do not fall under the same production line, the researchers observe an improvement for three ratios: collection period ratio, return on total assets, and profit or loss before tax. Thus, liquidity and profitability are improved. Second, when companies merged with their subsidiaries, the authors discover significant improvement for two ratios: gross margin and collection period ratio. In brief, positive results are found for mergers with subsidiaries and negative results with others. Third, the payment method influences two ratios, the current ratio and the stock turnover ratio. The current ratio is affected positively for the transactions in cash and negatively for the transactions in shares, while the stock turnover ratio is affected negatively for cash transactions and positively for share transactions.