Analysis of Accounting Transactions

Accounting transactions are the “raw data” of accounting system, but the idiosyncratic vernacular of accounting, and spotty empirical study of distributions and characteristics of accounting transactions mean that statistical methods that are applied in other disciplines are likely to prove suboptimal, and even counterproductive in auditing. This chapter delineates the idiosyncrasies of accounting transactions and summaries, and describes tools to cost-effectively prepare and render decisions from client accounting data.