ROLE OF THE CASH BASED RATIOS IN DETERMINATION OF ACCOUNTING MANIPULATIONS IN THE FINANCIAL STATEMENTS OF COMPANIES

The financial statements of general purpose are an important source of information for the purpose of business decision-making. The subject of this paper is the research of impact of cash-based ratios on the determination of accounting manipulations in the financial statements of companies. The main objective is to identify the cash-based ratios that contribute to the determination of accounting manipulations in the financial statements and the analysis of the value characteristics of identified cash-based ratios, due to the level of accounting manipulations in the financial statements of companies in the Federation of Bosnia and Herzegovina. The research was conducted on a sample of companies from the capital market in the Federation of Bosnia and Herzegovina in the period from 2010 to 2014. The collected data were analysed using the descriptive and inferential statistics methods, and the obtained results are presented by graphics and tables. The application of parametric and nonparametric statistical tests at a significance level of 5% resulted in determination of the cash-based ratios that are significantly different between companies with detected accounting manipulations and companies without detected accounting manipulations in the financial statements. Those cash-based ratios are Profit quality indicator (QPro), Cash investment indicator (CInv) and Cash capital indicator (CLA). Research results also indicate that companies with detected accounting manipulations in the financial statements have, on average, "weaker" values of cash-based ratios in relation to companies without detected accounting manipulations in the financial statements. Thus, it is evident that cash-based ratios have a positive impact on determination of accounting manipulations in the financial statements of the companies.