Detecting accounting fraud in companies reporting under US GAAP through data mining

Papík, Mário; Papíková, Lenka

doi:10.1016/j.accinf.2022.100559

Cited by 17 publications

(4 citation statements)

References 46 publications

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“…Fraud is carried out individually by each one but also by organizations with an ultimate goal of the gain of money, property, or services, meaning the avoidance of payment or loss of services or the securing of personal or professional advantage. In addition, the American Institute of Certified Public Accountants describes fraud as: "a broad legal concept distinguished from wrongdoing and depending on whether acts are intentional or not" (Bakre 2007;Papík and Papíková 2022). However, regardless of which of the above concepts one can consider for fraud, it has been proved that almost all fraud incidents fall into one or two specific categories related to theft and cheating.…”

Section: Discussionmentioning

confidence: 99%

It Is Time for Anti-Bribery: Financial Institutions Set the New Strategic “Roadmap” to Mitigate Illicit Practices and Corruption in the Market

Ragazou

Passas

Garefalakis

2022

Administrative Sciences

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The financial sector is characterized by complexity due to the management of a large volume of transactions, which can lead to the difficulty of considering, identifying, and monitoring them. The lack of mechanisms in monitoring and control transactions can contribute to the development of illegal practices within a company, such as fraud, corruption, bribery, and money laundering. These phenomena can affect financial institutions negatively. Therefore, the development of an appropriate corporate governance system can ensure to members of the board and executives in a company that any illegal practice can be detected. This study aims to highlight the factors that contribute to the development of illegal practices within European financial institutions. This can help executives to plan and mitigate the illicit practices that may emerge. For this purpose, a binary logit regression analysis on panel data from 2018 to 2020 was applied to 336 European financial companies. The findings of this research emphasize the crucial role of corporate governance in the prevention of the development of illicit issues within European financial institutions, while human resources can be characterized as a pathway to corruption. Both factors, corporate governance and human resources, are main pillars of environmental, social, and corporate governance (ESG), which indicates the need of the financial sector in Europe for the elaboration of anti-corruption strategies. Thus, companies within the sector can improve their ESG score.

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Section: Discussionmentioning

confidence: 99%

It Is Time for Anti-Bribery: Financial Institutions Set the New Strategic “Roadmap” to Mitigate Illicit Practices and Corruption in the Market

Ragazou

Passas

Garefalakis

2022

Administrative Sciences

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“…(Cheng, Kao, & Lin, 2021;Lin, Chiu, Huang, & Yen, 2015) . Cecchini et al, 2010b;Humpherys et al, 2011 Kotsiantis et al, 2006;Papík & Papíková, 2022 (Jan, 2018;R. Wang, Asghari, Hsu, Lee, & Chen, 2020;Yao et al, 2019) Loughran, & McDonald, 2013;Throckmorton, Mayew, Venkatachalam, & Collins, 2015 Wang et al, 2020;Yao et al, 2019 Wang et al, 2020;Yao et al, 2019 Chen et al, 2018( (Kirkos et al, 2007 CAT Wang et al, 2020;Yao et al, 2019 Wang et al, 2020;Yao et al, Beneish, 1999;Gepp, 2015;Papík & Papíková, 2022;Yao et al, 2019 ( .…”

Section: Originality and Additionmentioning

confidence: 99%

تقییم مداخل استخدام تقنیات التعلم الآلی فی المراجعة الخارجیة بغرض تحقیق فعالیة التنبؤ بتحریفات القوائم المالیة- دراسة تجریبیة على الشركات المقیدة فی البورصة المصریة

النقیب¹

2023

مجلة المحاسبة والمراجعه لاتحاد الجامعات العربیه

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“…Fraudulent behavior has been widely studied in the financial sector, particularly in the credit card [7] and insurance markets [8], as well as in forensic and accounting audits [9] however, studies of utility fraud are scarce and have been mostly limited to the electricity market, possibly because electricity consumption is one of the indicators of a country's economic growth and as such is followed in detail by national governments as one of the important items in macroeconomic policy.…”

Section: Literature Reviewmentioning

confidence: 99%

Fraud Detection in Utilities Using Data Analytics and Geospatial Analysis

Rodríguez¹,

Martínez²

2023

IJSSE

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One of the great challenges of any utilities around the world is the control of losses, which have different causes that are usually classified as technical (accuracy of equipment, leaks and breaks, construction and maintenance procedures) and NON-technical (thefts and frauds), affecting issues such: as investments for the expansion and maintenance of the networks, the profitability of the shareholders and even the continuity of the service. This article proposes a methodology for the detection of NON-technical losses common to any utility company, based on data analytics on business information enriched with data from third parties through geospatial analysis from its geographic location and market segmentation, which allows finding patterns on anomalous situations through supervised (on historical information) and unsupervised (if no information is available) machine learning models. The results of different classification algorithms used in data analytics were analyzed and the one with the highest accuracy and lowest type two error rates (false negatives) was selected to perform field verification work. The methodology was implemented in a natural gas distribution company and was contrasted with methodologies proposed by other authors for electric energy distribution companies, who consider that the problem should be addressed based on an analysis of historical consumption and its deviations. The results obtained with the proposed methodology improve the accuracy and sensitivity of the models by more than 20% and decreases false negatives by the same percentage, facilitating the verification and normalization of customers in anomalous situations and/or fraudulent conditions.

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Detecting accounting fraud in companies reporting under US GAAP through data mining

Cited by 17 publications

References 46 publications

It Is Time for Anti-Bribery: Financial Institutions Set the New Strategic “Roadmap” to Mitigate Illicit Practices and Corruption in the Market

It Is Time for Anti-Bribery: Financial Institutions Set the New Strategic “Roadmap” to Mitigate Illicit Practices and Corruption in the Market

Fraud Detection in Utilities Using Data Analytics and Geospatial Analysis

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