A Study On The New Third Board Companies' Accounting Distortion Distribution Based On Benford's Laws

The authenticity is one of the basic requirements of the accounting information.lt is necessary in guaranteeing healthy investment inviroment and maintaining market order.With more and more companies participating in the New Third Board,the pressure of supervision is rising for CSRC and other supervison department.There are many reasons that such as fraud that could cause distortion.Although auditing could help improve the quality of accounting information,but enterprises still pay fees to accounting firms for the accounting adjustment before approval of the New Third Board.Concerned these problems,it would be very uesful if there are one way to desicribe the whole distribution of the accounting information quality.In case to cut down the cost for CSRC for supervision,the study tend to establish a new way which based on Benford's law to describe the distortion of accounting authenticity.For general,the digit distribution need three condition to match the Benford's Law.First,there should be plenty of samples such like census.Secondly,the rage of the number should not be limited.Aside of the distortion of the accounting information,there are two other facts could affect the first digit distribution,to describe the distortion of the New Third Board based on Benford's Lord,the effects of other two facts should be clear.By arranging the order index,which is uncorrelated with the fitting indexs,the study describe the New Third Board accounting information distortion distribution under the effect of the order index.During the reasearch process,the study shows the number of the sample enterprises and the correlationship's effects on adaptation of the Benford's Law.By selecting order index and ordering the selected fitting index stastics,the study shows the distortion distribution of the New Third Board accounting information.The study discovered that the distortion of the accounting information is effected by the order index.We also discovered the phenomenon which I named "doorsill effect",which reveal that the distortion of accounting information will rising when the order index comes before the round number.