Effective General Ledger and Journal Entry Fraud Testing Using Data Analytics
How you can use technology to help in identifying potential financial statement fraud
Auditors and fraud examiners often use manual means to review the general ledger, however this generally proves ineffective given the breadth of the ledger and the limitations of the human eye. Relying exclusively on manual means may not be the most effective approach to finding fraud in the general ledger and journal entries. AICPA Practice Alert 2003-02 says: “Journal entries and other adjustments oftentimes exist only in electronic form, which requires extraction of the desired data for any quality analysis. In an IT environment, it may be necessary for the auditor to employ CAATs (for example, report writers, software or data extraction tools, or other systems based techniques) to identify the journal entries and other adjustments to be tested.”
This training, brought to you by AuditNet and FraudResourceNet, the premier website for anti-fraud resources will cover the following:
- How to set up a program of regular fraud risk management surrounding financial statement schemes
- How to quickly gather report ideas and techniques for analysis, and obtain a list of top fraud tests by process area.
- Prioritize the top red flags of financial statement fraud, based on research drawn from recent surveys.
- Complete improved risk assessments to assess financial risk in the organization, using data.
- How to use Excel to run key proactive fraud tests in the areas of the general ledger overall, manual journal entries, and completing other financial statement analysis
- How fraud scoring can use a customized weighting system to flag suspicious transactions.
- Use an Excel macro that will search a list of key words in your general ledger (words that are concerning like “Balance Account”, “Later Reconciliation”, etc.).
This is a previously recorded 2-hour webinar from AuditNet® with Jim Kaplan and Rich Lanza.
AuditNet® is the Global Resource for Auditors, and serves the global audit community as the primary communications resource with an online digital network where auditors share resources, tools, and experiences including audit work programs and other audit documentation.
As the first online portal for the global audit community, AuditNet® has been at the forefront of audit websites dedicated to promoting the use of technology. http://www.auditnet.org/
Jim Kaplan, the founder of AuditNet®, became a Certified Internal Auditor in 1984. He has continuously promoted and encouraged the use of technology and the Internet for audit productivity.
As an active member of the IIA, he has held many positions at the local and International level. He is a founding member of the Northern Virginia Chapter and served as Chapter President in 1989. He retired from his government audit director position in 2005. He is the founder and President of AuditNet®, the global resource for auditors, and has been identified as an Internet for Auditors pioneer. Jim's contributions to the profession were recognized by the IIA (2007 Bradford Cadmus award) and the Association of Local Government Auditors (Lifetime Achievement Award). In addition to the IIA, he is a member of the Association of Local Government Auditors and the Association of Certified Fraud Examiners.