Fraud Detection Tools

Price: $19.99

CPE Credits: 2.0

Category: ,

Course Number: ACCMCFDT

fraud detection

Description:
Two tools for fraud detection are discussed in this course; Benford’s Law and the Beneish M Score. Benford’s Law predicts the probability of the distribution of first digits in a set of accounting numbers. For the first digit, one is the most likely occurrence, followed by two, etc. In a large population of accounting transactions, by comparing the actual occurrence of first digits in accounting numbers to the Benford distribution, areas of concern are highlighted for further analysis and evaluation. Table of Contents
The Beneish M Score quantifies the possibility of financial manipulation occurring in financial statements. If the M Score is greater than (or less negative than) -2.22, it is likely that there is some manipulation of the financial results.
Both of these are powerful tools in the detection of fraud. Benford’s Law assists in the detection of transactional fraud while the Beneish M Score assists in the detection of fraud in financial reporting.

Delivery Method: Online QAS Self Study.

Level: Overview.

Prerequisites: None

Advanced Preparation: None

Author: Joseph Helstrom, CPA

Publication:  May 2015
Update: February 2018

Format: PDF and an Excel workbook
Pages: 57

Passing Grade: 70%

Exam Policies: Exam may be retaken. Course must be completed within one year of purchase.

CPE Sponsor Info : NASBA/QAS #109234. Click here to view specific state approvals.

By the end of the course participants should be able to:

• Describe how to use Benford’s Law to detect potential fraud
• Define situations where Benford’s Law is and is not applicable
• Describe the Beneish M Score and its components

Description:
Two tools for fraud detection are discussed in this course; Benford’s Law and the Beneish M Score. Benford’s Law predicts the probability of the distribution of first digits in a set of accounting numbers. For the first digit, one is the most likely occurrence, followed by two, etc. In a large population of accounting transactions, by comparing the actual occurrence of first digits in accounting numbers to the Benford distribution, areas of concern are highlighted for further analysis and evaluation. Table of Contents
The Beneish M Score quantifies the possibility of financial manipulation occurring in financial statements. If the M Score is greater than (or less negative than) -2.22, it is likely that there is some manipulation of the financial results.
Both of these are powerful tools in the detection of fraud. Benford’s Law assists in the detection of transactional fraud while the Beneish M Score assists in the detection of fraud in financial reporting.

Delivery Method: Online QAS Self Study.

Level: Overview.

Prerequisites: None

Advanced Preparation: None

Author: Joseph Helstrom, CPA

Publication:  May 2015
Update: February 2018

Format: PDF and an Excel workbook
Pages: 57

Passing Grade: 70%

Exam Policies: Exam may be retaken. Course must be completed within one year of purchase.

CPE Sponsor Info : NASBA/QAS #109234. Click here to view specific state approvals.

By the end of the course participants should be able to:

• Describe how to use Benford’s Law to detect potential fraud
• Define situations where Benford’s Law is and is not applicable
• Describe the Beneish M Score and its components

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