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OC user
OC user
in Accounting·
4 Nov 2018

According to the ACFE website the fraud triangle is a model forexplaining the factors that cause someone to commit occupationalfraud. It consists of three components which, together, lead tofraudulent behavior. Those three components are perceivedun-shareable financial need, perceived opportunity andrationalization. Sampling is one way to check for fraud however itcan be in effective. For samplings to be totally effectiveorganizations will need to analyze all relevant transactions inorder to effectively test and monitor internal controls. TheDetecting and Preventing Fraud with Data Analytics e-book statesthat the primary reason to use data analytics to tackle fraud isbecause a lot of internal control systems have serious controlweaknesses. One of the key aspects of data analytics is the abilityfor the technology to maintain comprehensive logs of all activitiesperformed. Since, sampling is in-effective there needs to be afraud detection that is repetitive, picking samples with continuousanalysis. Ad-hoc investigate transactions and see if there’sanything to indicate fraud or opportunities for fraud to beperpetrated. With the data analytics it can calculate statisticalparameters and look for outliers or values that exceed averages orare outside of standard deviations. Look at high and low values andfind anomalies there. Last but not least examine classification ofdata.

Question:

How computer-assisted audit software such as Audit CommandLanguage (ACL) can assist in these investigations.


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