A conceptual model for proactive detection of potential fraud enterprise systems: exploiting SAP audit trails to detect asset misappropriation

PhD Thesis


Singh, Kishore Harichunder. 2012. A conceptual model for proactive detection of potential fraud enterprise systems: exploiting SAP audit trails to detect asset misappropriation. PhD Thesis Doctor of Philosophy. University of Southern Queensland.
Title

A conceptual model for proactive detection of potential fraud enterprise systems: exploiting SAP audit trails to detect asset misappropriation

TypePhD Thesis
Authors
AuthorSingh, Kishore Harichunder
SupervisorBest, Peter
Mula, Jooseph
Institution of OriginUniversity of Southern Queensland
Qualification NameDoctor of Philosophy
Number of Pages364
Year2012
Abstract

Fraud costs the Australian economy approximately $3 billion annually, and its frequency and financial impact continues to grow. Many organisations are poorly prepared to prevent and detect fraud. Fraud prevention is not perfect therefore fraud detection is crucial. Fraud detection strategies are intended to quickly and efficiently identify frauds that circumvent preventative measures so that an organisation can take appropriate corrective action.

Enhancing the ability of organisations to detect potential fraud may have a positive impact on the economy. An effective model that facilitates proactive detection of potential fraud may potentially save costs and reduce the propensity of future fraud by early detection of suspicious user activities. Enterprise systems generate millions of transactions annually. While most of these are legal and routine transactions, a small number may be fraudulent. The enormous number of transactions makes it difficult to find these few instances among legitimate transactions. Without the availability of proactive fraud detection tools, investigating suspicious activities becomes overwhelming.

This study explores and develops innovative methods for proactive detection of potential fraud in enterprise systems. The intention is to build a model for detection of potential fraud based on analysis of patterns or signatures building on theories and concepts of continuous fraud detection. This objective is addressed by answering the main question; can a generalised model for proactive detection of potential fraud in enterprise systems be developed? The study proposes a methodology for proactive detection of potential fraud that exploits audit trails in enterprise systems. The concept of proactive detection of otential fraud is demonstrated by developing a prototype. The prototype is a near real-time web based application that uses SAS for its analytics processes. The aim of the prototype is to confirm the feasibility of implementing proactive detection of potential fraud in practice. Verification of the prototype is achieved by performing a series of tests involving simulated activity, followed by a full scale case study with a large international manufacturing company. Validation is achieved by obtaining independent reviews from the case study senior staff, auditing practitioners and a panel of experts. Timing experiments confirm that the prototype is able to handle real data volumes from a real organisation without difficulty thereby providing evidence in support of enhancement of auditor productivity. This study makes a number of contributions to both the literature and auditing practice.

Keywordsfraud detection; enterprise system; continuous monitoring; audit trail
ANZSRC Field of Research 2020350199. Accounting, auditing and accountability not elsewhere classified
Byline AffiliationsSchool of Accounting, Economics and Finance
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Related outputs

Proactive fraud detection in enterprise systems
Singh, Kishore, Best, Peter and Mula, Joseph M.. 2011. "Proactive fraud detection in enterprise systems." 2nd International Conference on Business and Information: Steering Excellence of Business Knowledge (ICBI 2011). Kelaniya, Sri Lanka 20 Oct 2011 Kelnaiya, Sri Lanka.