Much attention has been paid to the auditor's responsibility related to financial statement fraud, since the high profile Enron and WorldCom cases. Most jurisdictions have enacted auditing standards consistent with the International Standard on Auditing (ISA) 240, issued by the International Auditing and Assurance Standards Board of the International Federation of Accountants (IFAC) titled "The auditor's responsibility to consider fraud in an audit of financial statements". Known as SAS 99 in the US and CICA Handbook Section 5135 in Canada, this standard clarifies responsibilities and includes specific requirements.

IDEA® is an easy to use software tool which allows an external auditor to work directly with the client's data in its raw form - not summarized in a report. This gives the auditor much greater insight into the client's business by viewing the business at its lowest kernel of activity - the transaction. IDEA can then be used to analyze the data and produce summarized reports.

For example, IDEA can help you meet these specific SAS 99 requirements:

• Extent of procedures - use IDEA to perform 100% testing or one of its proven sampling methods
• Analytical procedures - use the Pivot Table, Summarize and Stratification analysis functions to obtain greater insight into the client's business
• Incomplete transactions, not timely - use Date and Time functions to find processing delays and missing information
• Inconsistent or inappropriate access to systems - use IDEA to analyze network log files by day of the week, compare to authorized personnel
• Missing documents - use Gaps and Duplicates functions to find missing or duplicated transactions

Other fraud detection tests you can perform using IDEA:

• Apply digital analysis to transaction files using "Benford's Law"
• Extract round number transactions from journal entry or invoice files, IDEA's optional component, Smart Analyzer - Financial, includes dozens of preprogrammed tests that auditors to easily perform a consistent set of procedures on each client file, covering journal entries, accounts receivable, accounts payable, inventory and fixed assets.
• Compare across files looking for address matches between employee and supplier master files for instance.
• Use Correlation, Time Series and Trend Analysis techniques to analyze business activities. (link to IDEA Advanced Statistical Methods - new Add-on)

For more information visit the IDEA product page.