Development of an anomaly detection model for a bank's transitory account system

Yongbum Kim, Alexander Kogan

Research output: Contribution to journalArticlepeer-review

17 Scopus citations


Fraud detection is one of the key components of an internal control system that is designed to provide reasonable assurance regarding reliable financial statements, effective and efficient operations, compliance with applicable laws and regulations, and safeguarding of assets (AICPA 2002; Committee of Sponsoring Organizations of the Treadway Commission 1992). Practically, however, it is challenging to determine what should be investigated among myriads of a company's transactions, most of which are normal and/or free from material error. Limited human resources and cost constraints are major barriers to fraud detection in practice. This study proposes a multi-step fraud detection model that screens transactions at various levels, which leads to a manageable number of transactions that internal auditors can examine. To that end, a broad screening criterion is applied at the highest level, while more detailed criteria are used at the lowest level. This study provides an example of development of a practicable fraud detection model.

Original languageEnglish (US)
Pages (from-to)145-165
Number of pages21
JournalJournal of Information Systems
Issue number1
StatePublished - 2014

All Science Journal Classification (ASJC) codes

  • Management Information Systems
  • Software
  • Information Systems
  • Accounting
  • Human-Computer Interaction
  • Information Systems and Management
  • Management of Technology and Innovation


  • Anomaly detection
  • Continuous auditing
  • Continuous monitoring
  • Fraud detection
  • Multi-step screening
  • Transitory accounts


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