Machine learning for journal entry testing: A type-aware evaluation of anomaly detectors under a review budget
cs.LG, cs.AI
Submitted: 2026-10-05
Updated: 2026-10-05
License: http://creativecommons.org/licenses/by/4.0/
The gist: Journal entry anomaly detectors are commonly evaluated on the full population with ROC-AUC, precision and recall, ignoring the review budget and which anomaly types are found.
Abstract
Journal entry anomaly detectors are commonly evaluated on the full population with ROC-AUC, precision and recall, ignoring the review budget and which anomaly types are found. We propose a type-aware evaluation combining per-type recall, fair-share type recall (FSR), which caps each type's credit at its budget share, type coverage and first-hit rank. We evaluate nine unsupervised detectors, a supervised reference and feedback-driven Deep Semi-Supervised Anomaly Detection (DeepSAD) on four real client ledgers with injected typed anomalies and a public synthetic ledger. On the largest client ledger, principal component analysis (PCA), an autoencoder (AE) and a variational autoencoder (VAE) each place on average 98 anomalies among the first 100 postings, but at least 95.8 belong to one type. FSR instead favours a nearest-neighbour (kNN) detector and changes the top-ranked detector on three of four client ledgers. Representation also matters: one-hot encoding exposes unseen accounts, whereas frequency encoding leaves unseen contra accounts largely undetected. On the public ledger, the Histogram-Based Outlier Score (HBOS) and Empirical Cumulative Distribution-Based Outlier Detection (ECOD) reach all eight markings within 1,386 entries, whereas kNN, the hit leader at 1,000 entries, first reaches cross-linked clearing at rank 4,641, and the supervised row-level reference misses this marking within 1,000 entries. There, the adaptive DeepSAD review protocol raises mean hits per 100 reviews from 40.0 to 68.3 but type coverage only from 2.7 to 3.0. These findings show that high hit rates can conceal systematic blind spots and suggest that feedback can reinforce existing detection patterns without broadening anomaly coverage.
Sources
- Anomaly Detection in General Ledger Data: Results from a Hybrid Approach
- Entity Embeddings of Categorical Variables
- Auto-Encoding Variational Bayes
- Detection of Anomalies in Large Scale Accounting Data using Deep Autoencoder Networks
- Detection of Accounting Anomalies in the Latent Space using Adversarial Autoencoder Neural Networks
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