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Data mining applications in accounting: A review of the literature and organizing framework

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  • Amani, Farzaneh A.
  • Fadlalla, Adam M.

Abstract

This paper explores the applications of data mining techniques in accounting and proposes an organizing framework for these applications. A large body of literature reported on specific uses of the important data mining paradigm in accounting, but research that takes a holistic view of these uses is lacking. To organize the literature on the applications of data mining in accounting, we create a framework that combines the two well-known accounting reporting perspectives (retrospection and prospection), and the three well-accepted goals of data mining (description, prediction, and prescription). The framework encapsulates a taxonomy of four categories (retrospective-descriptive, retrospective-prescriptive, prospective-prescriptive, and prospective-predictive) of data mining applications in accounting. The proposed framework revealed that the area of accounting that benefited the most from data mining is assurance and compliance, including fraud detection, business health and forensic accounting. The clear gaps seem to be in the two prescriptive application categories (retrospective-prescriptive and prospective-prescriptive), indicating opportunities for benefiting from data mining in these application categories. The framework presents a holistic view of the literature and systematically organizes it in a structurally logical and thematically coherent manner.

Suggested Citation

  • Amani, Farzaneh A. & Fadlalla, Adam M., 2017. "Data mining applications in accounting: A review of the literature and organizing framework," International Journal of Accounting Information Systems, Elsevier, vol. 24(C), pages 32-58.
  • Handle: RePEc:eee:ijoais:v:24:y:2017:i:c:p:32-58
    DOI: 10.1016/j.accinf.2016.12.004
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    Cited by:

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    2. Nora Muñoz-Izquierdo & María-del-Mar Camacho-Miñano & María-Jesús Segovia-Vargas & David Pascual-Ezama, 2019. "Is the External Audit Report Useful for Bankruptcy Prediction? Evidence Using Artificial Intelligence," International Journal of Financial Studies, MDPI, Open Access Journal, vol. 7(2), pages 1-23, April.
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    4. Laskai András, 2019. "AI foundations of the international business planning and the AI consciousness model," International Journal of Science and Business, IJSAB International, vol. 3(1), pages 17-28.
    5. Steen Nielsen, 2020. "Management accounting and the idea of machine learning," Economics Working Papers 2020-09, Department of Economics and Business Economics, Aarhus University.
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    7. Saxton, Gregory D. & Guo, Chao, 2020. "Social media capital: Conceptualizing the nature, acquisition, and expenditure of social media-based organizational resources," International Journal of Accounting Information Systems, Elsevier, vol. 36(C).

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