Proactive Journal Entry Testing

More Ways to Detect Illegal Entries


By Richard B. Lanza, CFE, CPA-CITP, PMP

Fear Not the Software   

In the November/December issue I explained the need for journal entry testing to thwart management override and detect financial statement fraud. At the end of that column, I explained how to perform two tests: (1) identifying journal entries posted on weekends and holidays and (2) extracting journal entries that equate to round multiples of 10,000, 100,000, and 1,000,000.

Here I'll explain eight additional journal entry tests that can be completed using Microsoft Excel and an inexpensive add-in to Excel: ActiveData for Excel.TM (To obtain a 30-day free license to ActiveData for Excel, see www.informationactive.com/ad/?aid=200.)

ORGANIZING THE EIGHT TESTS In the last column, I identified 16 reports that could be run on the general ledger and organized them into the five Ws. I explained how to do two of the 16 tests. Here are explanations for eight more tests:  

 

 

 

 

 


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