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Kelly, C (2011)

Benford's Law to the Rescue

Internal Auditor, Vol. 68, No. 1, pp. 25-27 .

ISSN/ISBN: Not available at this time. DOI: Not available at this time.

Abstract: Benford’s Law does not provide a final answer as to whether irregularities have occurred, but it is useful in leading the auditor to discrepancies for further investigation (Nigrini 1995). What makes Benford’s Law particularly useful for this kind of forensic audit is that it simultaneously allows both systematic and deep analysis of a large number of transactions. Analyzing the leading two digits is a minimum requirement. Analyzing to three digits increases the sensitivity of the test and can highlight repeated transactions as dramatic spikes. Specialist software is not essential. This can be done in Microsoft Excel.

@article {, AUTHOR = {Kelly, Chris}, TITLE = {Benford's Law to the Rescue}, JOURNAL = {Internal Auditor}, YEAR = {2011}, VOLUME = {68}, NUMBER = {1}, PAGES = {25--27}, MONTH = {February}, URL = {}, }

Reference Type: Journal Article

Subject Area(s): Accounting