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Monitoring Accounting Information via Control Charts
Abstract
Currently, there is a lot of interest in supporting the continuous assurance of financial statements (Vasarhelyi, 2002). The current research suggests using control charts to assist decision-makers in the identification of patterns in the underlying processes that produce financial statements. Once interesting patterns are identified, decision-makers may focus on the processes that generated the patterns. The objective of continuous monitoring is detecting abnormalities as near as possible to the time of occurrence of the underlying event that generated the data. If an error or irregularity occurs, the situation can be corrected, and the effect mitigated. Overall, the purpose for monitoring financial information is to gain confidence that systems are operating as intended through the ability to identify and resolve of errors, irregularities, or inconsistencies.
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