<abstract xmlns="http://www.w3.org/1999/xhtml"><p>Forensic accounting in scientific sense is the part of accounting that assumes the practice of scientific techniques and methods in conducting investigations and detecting criminal activities in financial statements, business statements and companies. One such tool in detecting anomalies in accounting records is the Benford’s Law, which gives the expected pattern of digit frequencies in numeric data sets according to their position in numbers. Because of this property, Benford’s law has become a significant forensic tool for the detection of anomalies, especially in financial business. One of the most important sources is account turnover data in the observed period, which has a debt and credit side. A classic way of analyzing these liabilities is to merge them and then look for a pattern of leading digits. In such approach, it is not possible to properly determine the source of anomalies, which are a guide to deeper analysis. For such purposes, a variant of the Hosmer-Lemeshow test is designed.</p></abstract>

Forensic accounting in scientific sense is the part of accounting that assumes the practice of scientific techniques and methods in conducting investigations and detecting criminal activities in financial statements, business statements and companies. One such tool in detecting anomalies in accounting records is the Benford’s Law, which gives the expected pattern of digit frequencies in numeric data sets according to their position in numbers. Because of this property, Benford’s law has become a significant forensic tool for the detection of anomalies, especially in financial business. One of the most important sources is account turnover data in the observed period, which has a debt and credit side. A classic way of analyzing these liabilities is to merge them and then look for a pattern of leading digits. In such approach, it is not possible to properly determine the source of anomalies, which are a guide to deeper analysis. For such purposes, a variant of the Hosmer-Lemeshow test is designed.

Benford’s Law in Forensic Analysis of Registered Turnover

FINra Tuzla and University “VITEZ” Vitez, Faculty of Business Economics

Journal of Forensic Accounting Profession

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

{"article-title":"Benford\u2019s Law in Forensic Analysis of Registered Turnover"}

Forensic accounting in scientific sense is the part of accounting that assumes the practice of scientific techniques and methods in conducting investigations...

Benford’s Law in Forensic Analysis of Registered Turnover

Published Online: Jul 17, 2021

Page range: 50 - 60

Received: May 04, 2021

Accepted: May 30, 2021

DOI: https://doi.org/10.2478/jfap-2021-0004

Keywords
Benford’s Law, Hosmer-Lemeshow Test, Forensic Accounting, Forensic Analysis

© 2021 Edin Glogić et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Benford’s Law in Forensic Analysis of Registered Turnover

Published Online: Jul 17, 2021

Page range: 50 - 60

Received: May 04, 2021

Accepted: May 30, 2021

DOI: https://doi.org/10.2478/jfap-2021-0004

KeywordsBenford’s Law, Hosmer-Lemeshow Test, Forensic Accounting, Forensic Analysis

© 2021 Edin Glogić et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
Benford’s Law, Hosmer-Lemeshow Test, Forensic Accounting, Forensic Analysis