The other primary combatant in the comment donnybrook referred to in the title (Humble Talent was the one noted in the previous COTD post) was Steve Witherspoon. In his Comment of the Day he references the crux of the dispute without actually referencing the dispute itself. His ever-green topic: the misuse of statistics:
Here is another reason that I dislike the use, or better yet the misuse/abuse, of statistics.
As we all likely know banks are routinely audited by outside sources to check for accuracy. Yesterday I got a piece of mail from a company that I’ve never done business with and I’ve never heard of. The mail was sent from a non local city that I wouldn’t be expecting mail from because I don’t know anyone who lives there and I don’t do business with any company from there. I opened it and found a single piece (3½” X 8½”) of paper with the printed logos from our local bank and the following statement on the top…
“Our Auditors have selected the following account for verification. Please review the information shown below and furnish details of any discrepancy to: [company name and address]. If information is correct, no action is needed.”
Then the paper included our home mortgage account number, interest rate, maturity date, and current balance as of a specific date that was mid month between payments. I read it a couple of times to confirm what I read, then I looked at my wife and said “These people are idiots.”
I checked and my bank confirmed that there was a audit in process and that the company that sent the mail to me was the auditing company.
This morning I sent the auditors the following email…
You sent us a form about your audit of ******* Bank asking us to verify our current mortgage balance as of 8/16/2019. Maybe you don’t realize, as a CPA you really should know, that people will not know the exact balance of their mortgage on any given date without calling the bank to get the balance. It’s a rare individual indeed that would have a daily mortgage amortization program since the first day of their mortgage that could accurately answer the question you posed. Asking what you asked requires the individual to either guess or call the bank you are auditing for the balance and BOTH of those options defeats the purpose of your auditing verification question.
I can tell you that the value of our mortgage is relatively close to the amount that you put on the questionnaire but I cannot confirm that it is correct.
Your question is simply not reasonable, and therefore not logical, for an average person to answer; as a CPA doing a bank audit you really should be able to do better.
Lastly; your questionnaire could potentially return a false sense of accuracy. With the amounts of junk mail that people receive, receiving a piece of mail from a completely unknown source will likely be thrown in the trash. Plus, your statement “If information is correct, no action is needed” actually inspires recipients to ignore it and you will interpret that lack of response as a confirmation of accuracy and you do not know that is in fact true. Your method of getting accurate information is terribly flawed.
So here we have what is essentially a statistical survey using predefined methodology that will interpret any lack of response as confirmation of accuracy. This is a complete failure in logic!!!
Over and over again we see that the results and the extrapolated interpretations of statistical data can be manipulated in many ways, both intentionally and unintentionally, but there are people that tell us that we must accept statistical data as actual “fact”.