Chapter 7 Assignment

Brief summaries (or factoids) of a dataset that provide a representation of the dataset as a whole.

Descriptive Analytics

Analytics performed to investigate the underlying cause that cannot be answered by simply looking at the descriptive data.

Diagnostic Analytics

Identifying the difference between a budget amount and actual performance.

Variance Analysis

Something that departs, or deviates, from the norm or the expectation.

Anomaly

Test to see if the key number field in the record is in correct ascending or descending sequence.

Sequence Check

Which of the following can potentially find gaps in the check numbers written?

Sequence check

What would be used to help find vendors that might have a similar address as an employee?

Fuzzy matching

When is Benford’s law analysis not useful?

Assets only recorded above a certain threshold

According to Benford’s law, which one of these first digits has a higher probability of occurrence than the first digit 3?

2

Which party needs to adjust its cash balance once learning about the following reconciling items?

Error

Potentially both

Which party needs to adjust its cash balance once learning about the following reconciling items?

Outstanding check

Bank

Which party needs to adjust its cash balance once learning about the following reconciling items?

NSF check

Company

Which party needs to adjust its cash balance once learning about the following reconciling items?

Outstanding deposit

Bank

Which party needs to adjust its cash balance once learning about the following reconciling items?

Notes or interest collected by the bank

Company

Which party needs to adjust its cash balance once learning about the following reconciling items?

Bank service fees

Company

Diagnostic analyses to compute and evaluate price and quantity variances would be an example of:

identifying anomalies and outliers

There are expected to be more numbers in the dataset with the leading digit of 6 as compared to 7.

Benford’s Law

Check 3313 is recorded twice for the same amount, but on different dates

Duplicate Check

Test used to evaluate if accounting profits are greater at manufacturing firms as compared to retailing firms.

Two-Sample t-test Difference of Means

Whoever signs the checks should be different than the one who records the transaction.

Separation of Duties

The owner spends her time addressing anomalies in her employees’ performances

Management by Exception

Diagnostic analytics which uncovers previously unknown linkages, patterns, and relationships between variables is known as which of the following?

drill-down, detailed

The appropriate test to compare one sample to another sample to see if one is greater than another in some way is called:

a two-sample t-test of a difference in means.

The appropriate test to see if independent variables are related to a dependent variable is called:

a regression.

Diagnostic analysis of the customer that owes the most would be an example of:

performing drill-down detailed analytics.

Diagnostic analyses evaluating the relationship between sales and advertising expense would be an example of:

determining relations, patterns, or linkages between variables through statistical analysis.

Name the appropriate diagnostic analytics technique utilized to find each type of anomaly.

Three cents of every dollar invested in advertising translates into $1 in sales

Regression Analysis

Name the appropriate diagnostic analytics technique utilized to find each type of anomaly.

Determining that some customers are much more profitable than others.

Drill-down, detailed analysis

Name the appropriate diagnostic analytics technique utilized to find each type of anomaly.

Transactions that are both recorded and authorized by the same person

Controls Testing – Segregation of Duties

Name the appropriate diagnostic analytics technique utilized to find each type of anomaly.

Unexpectedly, we find more transactions with the leading digit 7 in the dataset than those with a leading digit of 4.

Benford’s Law

Name the appropriate diagnostic analytics technique utilized to find each type of anomaly.

Check payment is applied twice to the same invoice.

Duplicate Check