Detecting fraud in financial data sets

Dominique Geyer (1)

1 Audencia Recherche

An important neef of corporations for internal audits is the ability to detect fraudulently reported financial data. Benford's Law is a probability distribution which is useful to analyse patterns of digits in numbers sets. A history of the origins of Benford's Law is given and the types of data sets expected to follow Benford's Law is discussed. This paper examines how BA students falsify financial numbers. The paper shows that they fail to imitate Benford's law and that there are cheating behaviour patterns coherent with previous empirical studies.

Mots clés: Income statement manipulation; Cheating behaviour and Benford's law; Accounting fraud; Internal auditing

Domaines: Gestion et management

Dominique Geyer. Detecting fraud in financial data sets. Journal of Business and Economics Research, 2010, 8 (7), pp.75-83. ⟨hal-00796943⟩