Software Development Exam > Software Development Videos > Tally ERP 9: Complete Training > Benford's Law Auditing - Tally.ERP 9 - Part 60
Benford's Law Auditing - Tally.ERP 9 - Part 60 Video Lecture | Tally ERP 9: Complete Training - Software Development
FAQs on Benford's Law Auditing - Tally.ERP 9 - Part 60 Video Lecture - Tally ERP 9: Complete Training - Software Development
| 1. What is Benford's Law and how does it relate to auditing? |  |
Ans. Benford's Law is a statistical principle that states that in many collections of numerical data, the leading digits are not distributed uniformly, but rather follow a predictable pattern. It has been found that the digit 1 tends to occur as the leading digit approximately 30% of the time, followed by 2 at around 17.6%, and so on, with 9 occurring only 4.6% of the time. This law is often used in auditing to detect anomalies or fraud in financial data by comparing the expected distribution of leading digits with the actual distribution.
| 2. How can Tally.ERP 9 be used for Benford's Law auditing? | |
Ans. Tally.ERP 9 is a popular accounting software that can be utilized for Benford's Law auditing. By extracting financial data from Tally.ERP 9 and analyzing the leading digits of various numerical fields such as transaction amounts or invoice numbers, one can compare the observed distribution with the expected distribution based on Benford's Law. This analysis can help auditors identify any deviations or irregularities that may require further investigation.
| 3. What are the benefits of using Benford's Law in auditing financial data? | |
Ans. The use of Benford's Law in auditing financial data offers several benefits. Firstly, it provides auditors with a statistical tool to detect potential anomalies or fraud, as any significant deviations from the expected distribution can indicate the presence of irregularities. Secondly, it can help auditors focus their attention on areas of financial data that require more scrutiny, saving time and resources. Lastly, Benford's Law can act as a deterrent to fraudulent activities, as individuals aware of this principle may be less likely to manipulate financial data knowing that their actions can be detected using statistical analysis.
| 4. Can Benford's Law be applied to any type of financial data? | |
Ans. While Benford's Law has been found to be applicable to a wide range of numerical datasets, including financial data, it is important to note that it may not be suitable for every type of financial data. The underlying assumption of Benford's Law is that the numbers being analyzed span several orders of magnitude and are not artificially manipulated or rounded. Therefore, it is more effective when applied to large datasets with diverse numerical values, such as transaction amounts, sales figures, or expense data.
| 5. Are there any limitations or challenges when using Benford's Law in auditing? | |
Ans. Yes, there are some limitations and challenges when using Benford's Law in auditing. One limitation is that the law is a statistical tool and not a definitive proof of fraud. Deviations from the expected distribution can indicate anomalies, but further investigation is needed to determine the cause. Additionally, Benford's Law may not be effective when applied to small datasets or datasets with limited variation. It is also important to consider the context and nature of the financial data being analyzed, as certain industries or types of transactions may have different distributions that deviate from Benford's Law. Auditors should use Benford's Law as one tool among many in their auditing process for the most accurate results.
Related Exams
About this Video
|
4.87/5 Rating |
|
Nov 22, 2024 Last updated |
Video Description: Benford's Law Auditing - Tally.ERP 9 - Part 60 for Software Development 2024 is part of Tally ERP 9: Complete Training preparation.
The notes and questions for Benford's Law Auditing - Tally.ERP 9 - Part 60 have been prepared according to the Software Development exam syllabus.
Information about Benford's Law Auditing - Tally.ERP 9 - Part 60 covers all important topics for Software Development 2024 Exam.
Find important definitions, questions, notes, meanings, examples, exercises and tests below for Benford's Law Auditing - Tally.ERP 9 - Part 60.
Introduction of Benford's Law Auditing - Tally.ERP 9 - Part 60 in English is available as part of our Tally ERP 9: Complete Training for Software Development & Benford's Law Auditing - Tally.ERP 9 - Part 60 in
Hindi for Tally ERP 9: Complete Training course. Download more important topics related with notes, lectures and mock test series for
Software Development Exam by signing up for free.
Description
Video Lecture & Questions for Benford's Law Auditing - Tally.ERP 9 - Part 60 Video Lecture | Tally ERP 9: Complete Training - Software Development - Software Development full syllabus preparation | Free video for Software Development exam to prepare for Tally ERP 9: Complete Training.
Information about Benford's Law Auditing - Tally.ERP 9 - Part 60
Here you can find the meaning of Benford's Law Auditing - Tally.ERP 9 - Part 60 defined & explained in the simplest way possible.
Besides explaining types of Benford's Law Auditing - Tally.ERP 9 - Part 60 theory, EduRev gives you an ample number of questions to practice Benford's Law Auditing - Tally.ERP 9 - Part 60 tests,
examples and also practice Software Development tests.
|
Explore Courses for Software Development exam
|
|
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
Related Searches
Viva Questions
,Benford's Law Auditing - Tally.ERP 9 - Part 60 Video Lecture | Tally ERP 9: Complete Training - Software Development
,Benford's Law Auditing - Tally.ERP 9 - Part 60 Video Lecture | Tally ERP 9: Complete Training - Software Development
,ppt
,Objective type Questions
,Benford's Law Auditing - Tally.ERP 9 - Part 60 Video Lecture | Tally ERP 9: Complete Training - Software Development
,practice quizzes
,Free
,shortcuts and tricks
,mock tests for examination
,Semester Notes
,Previous Year Questions with Solutions
,Summary
,video lectures
,Sample Paper
,MCQs
,Exam
,study material
,Important questions
,Extra Questions
,past year papers
;
Study Benford's Law Auditing - Tally.ERP 9 - Part 60 on the App
Students of Software Development can study Benford's Law Auditing - Tally.ERP 9 - Part 60 alongwith tests & analysis from the EduRev app,
which will help them while preparing for their exam. Apart from the Benford's Law Auditing - Tally.ERP 9 - Part 60,
students can also utilize the EduRev App for other study materials such as previous year question papers, syllabus, important questions, etc.
The EduRev App will make your learning easier as you can access it from anywhere you want.
The content of Benford's Law Auditing - Tally.ERP 9 - Part 60 is prepared as per the latest Software Development syllabus.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup