RESHAPE: Explaining Accounting Anomalies in Financial Statement Audits by enhancing SHapley Additive exPlanations

TL;DR

This paper introduces RESHAPE, a novel explainability method for autoencoder neural networks in financial audits, providing attribute-level explanations to improve interpretability and facilitate adoption of deep learning models.

Contribution

RESHAPE offers aggregated attribute-level explanations for unsupervised DL models, enhancing interpretability over existing methods in financial statement audits.

Findings

RESHAPE provides more versatile explanations than state-of-the-art baselines.

Experimental results confirm improved interpretability for auditors.

The method supports adoption of deep learning in financial auditing.

Abstract

Detecting accounting anomalies is a recurrent challenge in financial statement audits. Recently, novel methods derived from Deep-Learning (DL) have been proposed to audit the large volumes of a statement's underlying accounting records. However, due to their vast number of parameters, such models exhibit the drawback of being inherently opaque. At the same time, the concealing of a model's inner workings often hinders its real-world application. This observation holds particularly true in financial audits since auditors must reasonably explain and justify their audit decisions. Nowadays, various Explainable AI (XAI) techniques have been proposed to address this challenge, e.g., SHapley Additive exPlanations (SHAP). However, in unsupervised DL as often applied in financial audits, these methods explain the model output at the level of encoded variables. As a result, the explanations of Autoencoder Neural Networks (AENNs) are often hard to comprehend by human auditors. To mitigate this drawback, we propose (RESHAPE), which explains the model output on an aggregated attribute-level. In addition, we introduce an evaluation framework to compare the versatility of XAI methods in auditing. Our experimental results show empirical evidence that RESHAPE results in versatile explanations compared to state-of-the-art baselines. We envision such attribute-level explanations as a necessary next step in the adoption of unsupervised DL techniques in financial auditing.