34 Pages Posted: 30 Jul 2008 Last revised: 27 Aug 2014
Date Written: August 1, 2003
We demonstrate the usefulness of Data Envelopment Analysis (DEA) as an analytical procedure for auditors, especially in the planning stage of the audit, to determine the extent of audit and to assess the preliminary risk level of the client. DEA based analytical procedures can provide consistent and reliable red flags and benchmarks for auditors to compare a client to other firms in the same industry. We provide an illustrative use of DEA as an analytical procedure for auditing a client in the oil and gas industry.
Keywords: Risk, Analytical Procedures, Benchmarks, Red Flags, Audit, DEA
JEL Classification: C44, C61, C67, D57, G1, G2, G3, M4
Suggested Citation: Suggested Citation
Feroz, Ehsan H. and Kim, Sungsoo and Raab, Raymond L., ANALYTICAL PROCEDURES: A Data Envelopment Analysis Approach (August 1, 2003). Journal of Emerging Technologies in Accounting, Vol. 2, pp.17-31, 2005 . Available at SSRN: https://ssrn.com/abstract=1179302