Reducing the complexity of financial networks using network embeddings
| Autor: | Drona Kandhai, M. Boersma, Lucas A. Hoogduin, Sumit Sourabh, A. Maliutin |
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| Přispěvatelé: | Computational Science Lab (IVI, FNWI), Accounting (ABS, FEB) |
| Jazyk: | angličtina |
| Rok vydání: | 2020 |
| Předmět: |
Multidisciplinary
Financial networks Science Node (networking) Computational science Stability (learning theory) Accounting scandals 02 engineering and technology Applied mathematics Data science Article Financial Audit 020204 information systems 0202 electrical engineering electronic engineering information engineering Systemic risk Medicine 020201 artificial intelligence & image processing Sociology Cluster analysis Transaction data |
| Zdroj: | Scientific Reports, 10:17045. Nature Publishing Group Scientific Reports, Vol 10, Iss 1, Pp 1-15 (2020) Scientific Reports |
| ISSN: | 2045-2322 |
| DOI: | 10.1038/s41598-020-74010-2 |
| Popis: | Accounting scandals like Enron (2001) and Petrobas (2014) remind us that untrustworthy financial information has an adverse effect on the stability of the economy and can ultimately be a source of systemic risk. This financial information is derived from processes and their related monetary flows within a business. But as the flows are becoming larger and more complex, it becomes increasingly difficult to distill the primary processes for large amounts of transaction data. However, by extracting the primary processes we will be able to detect possible inconsistencies in the information efficiently. We use recent advances in network embedding techniques that have demonstrated promising results regarding node classification problems in domains like biology and sociology. We learned a useful continuous vector representation of the nodes in the network which can be used for the clustering task, such that the clusters represent the meaningful primary processes. The results show that we can extract the relevant primary processes which are similar to the created clusters by a financial expert. Moreover, we construct better predictive models using the flows from the extracted primary processes which can be used to detect inconsistencies. Our work will pave the way towards a more modern technology and data-driven financial audit discipline. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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