HOW TO UNCOVER SUSPECT VENDOR TRANSACTIONS

AUDIT CASE STUDY

BACKGROUND

• Multi-billion dollar global defense contractor developing state-of-the-art systems

• 10,000+ employees • Global offices in North America, Europe and South America• 15 lines of business including technologies for defense,

homeland security and commercial aviation • Clients include government and private sector companies• Highly regulated

OBJECTIVES

• Company wanted to review purchase data over time to identify potential fraudulent patterns

• Fraudsters typically start by stealing small amounts within a “test phase” and gradually increase the amounts over time as their confidence (and greed) build

FRAUD INCREASES OVER TIME

PROCESS

• The company performed a time series analysis to search for acceleration in payments, starting with high-risk vendors, then look for patterns and investigate further

• To identify patterns over a period of time, audit team had to analyze over 5 years of data from tens of thousands of vendors

• Each data set contained multiple fields. • Narrowing the population would have been impossible

without the use of a data analytics tool

BIG DATA CHALLENGES

• Millions of records with multiple fields• Filtering based on risk

• Match with employee files- extensive data cleansing required

• Vendor type

• Transaction values

• Transaction volume

• Subjective risk assignment

RESULTS

• Extracted transaction data for 5 years by quarter for selected vendors

• Plotted transaction values against expected (fraud) trend• No exceptions identified!

• Lack of exceptions provides assurance that current internal controls are effective

• With process in place, can now repeat data analysis to ensure that fraud does not start

LEARN ABOUT USING IDEA FOR VENDOR ANALYSIS

Contact us at salesidea@caseware.com to schedule a demonstration

HOW TO UNCOVER SUSPECT VENDOR TRANSACTIONS

AUDIT CASE STUDY

Visit casewareanalytics.com Email salesidea@caseware.com