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Could you please interpret the information detailed below in Figure 1: Benfords Law Distribution and Table 1: Benfords Law Distribution Data. The Directors at Boonie

Could you please interpret the information detailed below in Figure 1: Benfords Law Distribution and Table 1: Benfords Law Distribution Data.

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The Directors at Boonie Doon Hospital suspect that the hospital may have become a victim of fraud. The Directors provide you with details of 13,260 invoices received from various suppliers during July 2016. In order to assess the risk of fraud you produce a Benford's Law Distribution based on supplier invoice amounts shown in Figure 1 and Table 1 below. Figure 1: Benfords Law Distribution First Digit Test for Invoice Amount 0.35000 0.30000 0.25000 0.20000 Proportion 0.15000 Actual Proportion -O-Benford Proportion 0.10000 0.05000 0.00000 2 3 5 Digit First Digit 1 2 3 4 5 6 7 8 9 Total Table 1: Benford's Law Distribution Data Invoice Actual Benford Count Proportion Proportion Z Statistic 4,008 0.30226 0.30103 0.29992 2,350 0.17722 0.17609 0.33127 1,518 0.11448 0.12494 3.62936 1,339 0.10098 0.09691 1.56969 1,030 0.07768 0.07918 0.62532 901 0.06795 0.06695 0.44425 766 0.05777 0.05799 0.09189 752 0.05671 0.05115 2.88610 596 0.04495 0.04576 0.42575 13,260 The Directors at Boonie Doon Hospital suspect that the hospital may have become a victim of fraud. The Directors provide you with details of 13,260 invoices received from various suppliers during July 2016. In order to assess the risk of fraud you produce a Benford's Law Distribution based on supplier invoice amounts shown in Figure 1 and Table 1 below. Figure 1: Benfords Law Distribution First Digit Test for Invoice Amount 0.35000 0.30000 0.25000 0.20000 Proportion 0.15000 Actual Proportion -O-Benford Proportion 0.10000 0.05000 0.00000 2 3 5 Digit First Digit 1 2 3 4 5 6 7 8 9 Total Table 1: Benford's Law Distribution Data Invoice Actual Benford Count Proportion Proportion Z Statistic 4,008 0.30226 0.30103 0.29992 2,350 0.17722 0.17609 0.33127 1,518 0.11448 0.12494 3.62936 1,339 0.10098 0.09691 1.56969 1,030 0.07768 0.07918 0.62532 901 0.06795 0.06695 0.44425 766 0.05777 0.05799 0.09189 752 0.05671 0.05115 2.88610 596 0.04495 0.04576 0.42575 13,260

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