Learn At Lunch - Auditing Analytics
“Data mining allows businesses to gain competitive advantage by uncovering trends and patterns to support decision-making. Importantly, we must be mindful that analytics is a tool that bears productive results only when appropriately used,” said Professor Koh Hian Chye, Head of Business Intelligence & Analytics at the Singapore University of Social Sciences.
A case in point is Walmart, which found from data mining that diapers and beer frequently occurred together in the same transactions. It then uncovered that when male customers visited the store to pick up diapers for their little ones, they would also buy themselves a couple of beers. This finding, though initially puzzling, had important implications on the decisions relating to store layout, bundling and discounts for Walmart.
Over 60 internal audit professionals learnt more of such real-life examples of how data mining/analytics had impacted people’s daily lives at the Learn At Lunch talk on “Auditing Analytics” held on 14 November 2019 and presented by Professor Koh. Focusing on internal audit and through demonstrations using visualisation, association and clustering, as well as predictive modelling, the talk provided participants with a better understanding of data mining and its potential application in auditing.
“Data analytics is transforming audit by providing data-enabled insight coupled with the identification of high-risk items, thus allowing internal auditors to prioritise and investigate high-value areas,” added Mr Koh.
Professor Koh also conducted a ‘live’ demonstration on the use of predictive modelling to test the soundness of reported daily movie ticketing sales by comparing the actual and predicted sales generated by the prediction model. Large differences may warrant further investigation, and patterns and trends should be examined to discover anomalies during audit checks.
The participants left with a good feeling of the talk being “very informative” with “practical illustrations”.
A copy of the book, "Data Mining Applications for Small and Medium Enterprises" written by Prof. Koh Hian Chye is available for loan to members. Please contact us at 6324 9029 or secretariat@iia.org.sg to borrow.
Data Mining Applications for Small and Medium Enterprises
by Prof. Koh Hian Chye
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