The Efficacy of Predictive Methods in Financial Statement Fraud

Table 5

Descriptive statistics of the performance measures obtained from 1000 iterations segmented by different rate of fraudulent companies, and for training sample size of 500 and test sample size of 170.

		1% Fraud		3% Fraud		5% Fraud		7% Fraud		10% Fraud
		Prec.	recall	Prec.	recall	Prec.	recall	Prec.	recall	Prec.	recall
MFFNN	Avg.	0.967	0.963	0.966	0.961	0.967	0.955	0.966	0.954	0.965	0.953
	SD	0.022	0.024	0.022	0.025	0.023	0.026	0.023	0.025	0.024	0.025
	Min	0.882	0.870	0.882	0.867	0.866	0.846	0.882	0.868	0.882	0.865
	Max	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
PNN	Avg.	0.972	0.729	0.969	0.727	0.970	0.721	0.970	0.723	0.970	0.723
	SD	0.020	0.043	0.022	0.043	0.022	0.043	0.022	0.043	0.022	0.042
	Min	0.882	0.607	0.882	0.598	0.896	0.591	0.897	0.598	0.881	0.608
	Max	1.000	0.918	1.000	0.861	1.000	0.835	1.000	0.853	1.000	0.868
SVM	Avg.	0.905	0.909	0.897	0.908	0.897	0.906	0.900	0.907	0.898	0.907
	SD	0.037	0.036	0.037	0.034	0.039	0.035	0.037	0.036	0.039	0.033
	Min.	0.779	0.781	0.765	0.787	0.761	0.766	0.735	0.770	0.750	0.782
	Max	1.000	1.000	1.000	1.000	0.985	1.000	1.000	1.000	1.000	0.985
MLM	Avg.	0.885	0.882	0.884	0.881	0.884	0.881	0.888	0.886	0.888	0.886
	SD	0.042	0.037	0.042	0.037	0.041	0.037	0.041	0.039	0.041	0.036
	Min	0.735	0.754	0.765	0.775	0.731	0.734	0.750	0.747	0.735	0.763
	Max	0.985	0.984	0.985	0.983	1.000	0.984	0.985	1.000	0.985	0.984
DA	Avg.	0.904	0.865	0.901	0.871	0.900	0.878	0.902	0.888	0.900	0.896
	SD	0.038	0.038	0.039	0.036	0.039	0.036	0.037	0.036	0.038	0.034
	Min	0.779	0.733	0.735	0.757	0.746	0.756	0.750	0.782	0.750	0.753
	Max	1.000	0.984	1.000	0.984	1.000	0.983	1.000	1.000	1.000	0.985