Fraud Examination 5th Edition by Steve Albrecht,Chad Albrecht,Conan Albrecht, Mark Zimbelman

Exercise 48

As an internal auditor for CRA, Inc., you are assigned to a team working on an ongoing project to identify possible fraud. The project started with time trend analysis of purchase prices of all items in the company. The project was started last year, but because of budget problems, it was delayed until this year. Most of the data mining is complete, but the team is having problems understanding how to continue the approach.
1. Describe the steps in time trend analysis, including correct data preparation.
2. What types of fraud can be identified with time trend analysis