This project deals with a very specific element of information used in investment decision making, namely the production of accounting reports. It is possible for management to manipulate the bottom line numbers in reports by choosing appropriate accounting policies and this software is designed to detect such practices by identifying unusual accrual activity by companies.

Even with the knowledge that there has been unusual accrual activity, it still might not be a concern assuming one is convinced that auditors (who work on behalf of shareholders) have done a thorough job. The second part of the software assesses whether the audit process is subject to question.

The ultimate aim is to identify companies that are aggressive in the accounting policy choice and are under audited as these may represent a risk of financial difficulties and even failure.

For more details click here.