MindBridge Case: Case Study B.

Learning Objectives:
1: Create a project in MindBridge and upload a data set
Upon completion of the exercises associated with Learning Objective 1, you will be able to:
 Create an engagement in MindBridge and upload a data set
 Interpret the MindBridge risk scoring engine and be able to adjust the underlying control point
settings
 Execute an analysis in MindBridge

2: Analyze a data set using MindBridge

Upon completion of the exercises associated with Learning Objective 2, you will be able to:
 Identify unusual transactions using the risk overview dashboard
 Identify unusual transactions using MindBridge search functionality
 Add transactions to MindBridge Audit Plan and export the Audit Plan for additional review

 Log into your MindBridge account, on the bottom left, in the menu, click on the to open
the support menu and select “MindBridge Academy”
 This will open a tab with MindBridge University
 In the search bar, type “Case A” – this should help you find the course: Case Study A – this is our
first practice case study
 Enroll in this course
 Once you Enroll in the course, you will have access to the case and all the instructions for
completing the case work

Your client & data

Financial Statement Fraud Scheme
Fictitious Revenue
Financial Statement fraud is a scheme in which an employee intentionally causes a misstatement or
omission of material information in the organization’s financial reports. These fraudsters are mostly
found in executive leadership positions such as CEOs or CFOs. Financial statements are often
manipulated to improve the bottom line to hit KPIs for bonus payments or external investors.
One technique “to cook the books” is the fictitious revenue schemes. Such schemes artificially inflate a
company's profits by recording phony revenues for goods or services that are never delivered.
In the following Case Study the CEO is doing exactly that, recording revenues for a service that was
never delivered.

Your client
Dan's Furniture is a medium sized home furnishing company located in Western Canada. It employs a
staff of 150 and is continuing to grow. The company has had a successful few years, frequently
exceeding their revenue targets, much to the pleasure of their board of directors.
The company has an aggressive remuneration policy with a significant part of the CEO, Dan Jacobs', pay
being tied to profits.
During the risk-assessment process the audit team flagged the bonus scheme as a risk item. Appropriate
tests are to be planned and executed to address this risk.
In case you need the instructions separately, here they are:
The general ledger
The company provided you with an interim general ledger (1st July 2020 - 31 March 2021). The financial
year end for the business is 30th June 2021. Various pieces of information have been provided which
may help with designing your analysis.
 The company uses the SAP One as their internal ERP.
 The materiality for this audit engagement is $50,000.
 It is also important to note that bookkeeping is regularly done on weekends.
 The largest bonus payout to date was made during the holiday season 2020. An anonymous
employee at Dan's Furniture raised some concern at this time regarding what they felt was an
unusually large payout to the executive team.
Please download below the interim general ledger provided by the company and save it to your
computer.

Your task
Analyze the General Journal using the MindBridge tool addressing the identified fraud risk.
The following step-by-step exercises will walk you through the process to add transactions to the Audit
Plan. Upon completion export this Audit Plan and send it to your professor.
In our fictitious story, a Staff Accountant would visit Dan's Furniture and validate the transactions you
identified.

Note: This case study is designed to be harder than Case Study A. We no longer provide you with video
walkthroughs. If you get stuck at any stage, try going back to Case Study A to understand how the
various features of the analysis work.

MindBridge Knowledge Base

As you are just getting started, we have included additional supporting articles throughout Case Study B
to support you with each step. You can access these articles via the links provided, which will take you to
the MindBridge Knowledge Base(opens in a new tab).

It is highly recommended that you go through these resources as they provide further details on how to
conduct each of the steps that have been identified.

Once you have saved your general ledger, click below to move onto the next section, Your Task.
1. Log in
2. Click “Create an Organization”
3. Please name it YOUR FULL NAME – Case B
4. New Engagement
a. Engagement Name: Case Study B
b. Library: MindBridge for-profit (MAC)
c. Roll forward: Leave blank
d. Import settings: Leave blank
e. Reporting frequency: ‘Annually’
f. Fiscal start month: ‘July’
g. Fiscal start day: 1
h. Audit Period End Date: 30th June 2021
i. Billing code: Leave blank
j. Industry: Wholesale Trade
 k. Financial Management System: 'SAP One'
l. Engagement Lead: Select yourself
m. Auditors: Leave blank
n. Click Next
5. Create an analysis:
a. Name: ‘General Ledger Analysis Case Study B’
b. Analysis Type (Toggle): Interim analysis
c. Analysis period start date: 01 July 2020
d. Interim as-at date: 31 March 2021
e. Analysis period end date: 30 June 2021
6. Data loading
Next to 'Interim General Ledger' click 'Browse' and then 'Browse your computer' to import
the downloaded general ledger Excel file.
a. Confirm 'Data Validation' by clicking 'Next'
MindBridge offers these data integrity checks to help you identify any possible errors
within the file your client extracted. In this case no errors are detected.
b. Confirm 'Column Mapping' by clicking 'Next'
Ensuring columns from your data are mapped to MindBridge is an important step. In
this case MindBridge detected the column names and did this process automatically.
c. Confirm ‘Analysis Period' by clicking 'Next'
During this step we should verify that the data matches our expectations given the time
period we are looking to analyze. In this case all the data appears to be there.
d. Confirm ‘Review Data’ by clicking ‘Next’
During this step we are being asked to provide a transaction identifier used to identify
the relationship between entries. In this case MindBridge has done this automatically.
Adjust the control point settings:
e. Material value: $50,000
$50,000 is the materiality level we have determined for this client and this engagement.
Any activity recorded below this value will later be assigned a lower risk score.
f. Suspicious keyword: add Dan Jacobs
Suspicious Keyword is triggered by transactions containing words that may indicate
suspicious activity. You may recall Steve Smith is the company CEO and we want to
ensure any suspicious activity associated with his name is identified.
7. Verify Accounts
a. Click 'Verify accounts'
b. On the Account Groupings screen, click 'Next'
c. On the Account Mappings screen, click 'Next'
d. On the Review screen, click 'Done'
e. Click 'Verify mappings' again to confirm
8. Adjust the risk score weighting
a. Navigate to 'Engagement Settings' by clicking the cog icon on the bottom left of the
screen
b. Navigate to the 'Risk Scores' tab
c. Scroll down the section titled 'Overall scores'
d. Expand the 'MindBridge Scores' list within the 'Overall scores' section, by clicking the
arrow
e. Within the expanded section, search for and amend the following Control Points
i. Weekend Post: reduce to 0%
 We know this business typically operates over the weekend so we don't want
to assign any risk to activity posted during the weekend.
ii. Material Value: Make sure this is set to 10%, if not change to 10% - reason:
Changed weighting to the recommended setting of 10%
f. Click 'Save' at the top of the 'Overall scores' section
g. When prompted enter your "Reason for change"
When adjusting any of the risk scores it is essential that we document the reasons for
the change. These reasons will be added to your audit file and will comprise a key
component of your documentation should future users, or even the regulators, wish to
understand your decision making.
9. Run the analysis
a. Return to the 'Data page' through the left sidebar
b. Click 'Run analysis'
For analytics tools like MindBridge it is generally true that the more data that we
provide the better the analysis. For other audits we may also wish to upload trial
balance data, or up to five years worth of prior period data. This would further enhance
the results of our analysis. Unfortunately in this case we have only been provided with a
General Ledger. Without any other files to load we can start out analysis right away.
10. Select transactions for field testing
Using the Filter Builder
Navigate to the Data Table (opens in a new tab)tab. Start by changing the view from 'Entries' to
'Transactions'. Leaving the page on the Entries view will affect the Filter Builder and the results.
See the below gif for support.
Here, we will be creating two filters to filter down transactions of interest. Create a bulk task
and add the transactions to the audit plan. Provide your thoughts about each filter in the bulk
task description. What do you think is the rational for each filter?
a. Filter 1:
Create a filter to identify transactions that were entered manually.
b. Filter 2:
Create a filter to identify transactions that are revenue related and have a monetary
value of above $100,000.
11. Exporting your results
In this final stage we will export our saved results. In a normal audit we may then proceed to
test the transactions we selected throughout the process - including a visit back to the Builder
Inc. site.
As you go through this next section make sure to save your results - these will be needed for the
final assessment at the end of this course.
a. Export your Audit Plan
Go to your Audit Plan(opens in a new tab) section and export(opens in a new tab) the
entire plan.
This contains all of the transactions you selected for testing. Save the results to your
computer as you will need this report during the final assessment.