Assume that you have just been hired by Tampa Electronics in their Internal Audit department. Ms. Gonzales has asked you to undertake the task of examining the travel expense data to determine whether there are any potentially fraudulent travel reimbursements. In addition to clear violations of the companys rules e.g., an approval being used for multiple trips, an expense reimbursement without an approval, you should be looking for indicators of potentially fraudulent travel expense reimbursements. Unusual expenses, which may not necessarily be fraudulent, are potential indicators of fraud. An illustration of an unusual expense is a particular reimbursement transaction that is more than double the average expense for that expense category. Examples of such unusual expenses are an airfare expense from Tampa to Atlanta that is more than double the average airfare between these two cities, or a daily hotel expense in Miami that is more than double the average daily hotel expense for that city. Note that for hotel expenses it is necessary to first calculate a daily hotel cost, since the number of days traveled would vary from trip to trip number of travel days travel end date-travel start date. Thus, the total hotel expenses divided by the number of days traveled would yield the daily hotel cost on each trip. You should also look for unusual patterns of expenses, for example an unusually high number of taxi expenses submitted by a particular salesperson relative to other salespersons. This assignment is somewhat ambiguous, by design. You will have to think carefully and creatively about what would constitute an unusual potentially fraudulent travel expense transaction in this scenario. There will very likely be a number of variations in submitted assignments. There are some low-hanging fruitthat is, anomalies that can easily be detected, as well as some nuggets that may take a series of steps to find. For full credit on this assignment, your data analysis procedures should be aimed at detecting more than just the low-hanging fruit.

Question 1

Section 1Executive Summary This should be addressed to Mr. Yorke, the CFO of Tampa Electronics. After a brief introduction two to three sentences, provide a numbered list of the discrepancies you found i.e., issues that might be indicative of fraud, or at least highly unusual expense reimbursements. You should not provide any details of the computer-assisted data analysis steps here, since those details would be irrelevant to the CFO. In each case, however, you should indicate the dollar amount of