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Exam PA · Reports for Decision-Makers · Tutorial 773 of 966

Presenting Data-Quality Findings in Context

Learn to describe material data-quality issues clearly, explain how they were handled, and state what they may mean for reported findings.

Intermediate 11 min read

What You'll Learn

  • Quantify the extent of missing fields and incomplete outcomes.
  • Explain why observed records may not represent records with missing information.
  • Distinguish verified errors from unusual but valid observations.
  • Report sensitivity checks without presenting them as proof that a record is invalid.
  • Describe how incomplete follow-up limits conclusions about outcomes.
  • Connect each data-quality finding to the population and decision it may affect.

Why Data Quality Belongs Beside the Findings

A predictive result is only as informative as the data used to produce and assess it. A report that gives a performance figure but omits substantial missingness, unverified extreme values, or incomplete outcome records can leave decision-makers with an overly confident impression. The goal is not to list every data-cleaning step. It is to identify consequential limitations, state how they were handled, and explain what effect they could have on the reported findings.

A useful account is specific: name the affected variable or records, give the number or proportion affected, describe the handling decision, and state the plausible consequence. Distinguish what is known from what is possible. For example, “12% of records lacked income” is a measured fact; “the missing records may differ from the analyzed records” is a limitation to consider, not a demonstrated cause of bias.

Definition: A data-quality finding is a consequential observation about the completeness, validity, consistency, or coverage of data used in an analysis. A report should connect each material finding to its extent, its handling, and its possible effect on the conclusions.

Describe the Issue, the Handling, and the Implication

A compact report can organize each issue around three questions: How much data are affected? What was done about them? How might that decision affect the result? State the denominator as well as the count. “60 records were missing income” is less interpretable than “income was missing for 60 of 500 records (12%).” If different variables have different amounts of missing information, report them separately rather than implying that every record has the same completeness.

1
Quantify.
Give the affected field or record type, the count, and the relevant denominator. Identify the analysis subset if it differs from the full data set.
2
State the handling.
Say whether records were retained, excluded, corrected using verified information, or left unresolved. Do not describe a suspected error as a confirmed one.
3
Explain the possible effect.
Describe which population, comparison, or reported finding could be affected, and whether the direction of the effect is known.

Missingness can affect findings when records without a value differ from records with a value. A simple identity shows why the observed mean alone may not describe the full group. Suppose a quantitative variable is observed for \(n_o\) records and missing for \(n_m\) records, with \(n=n_o+n_m\). If the full-group mean of the missing values would be \(\bar{x}_m\), and the observed mean is \(\bar{x}_o\), then the full-group mean is:

$$ \bar{x}=\frac{n_o\bar{x}_o+n_m\bar{x}_m}{n} =\bar{x}_o+\frac{n_m}{n}(\bar{x}_m-\bar{x}_o). $$

The second equality follows by writing \(n_o=n-n_m\), substituting, and collecting terms. It shows that the full-group mean equals the observed mean if the missing records have the same mean, or if no records are missing. Otherwise, the difference depends on both the missing fraction and the difference between the two group means. Since \(\bar{x}_m\) is not observed, the report generally cannot establish the direction or size of that difference from the observed records alone.

Worked Example: Reporting Missing Income With an Observed Outcome

In a hypothetical portfolio study, 500 policy records have a recorded outcome indicating whether a specified event occurred during the observation window. Income is missing for 60 records. Among the 440 records with income, 44 have the event. Among the 60 records without income, 12 have the event. Calculate the missingness rate and compare the observed event proportions. Recommend a careful report statement. Treat the counts as the complete data for this example; no probability distribution is assumed.

Step 1: Calculate the missingness rate. The denominator is all 500 records:

$$ \frac{60}{500}=0.12=12\%. $$

Step 2: Calculate the event proportion in each group. For records with income, the proportion is \(44/440=0.10\), or 10%. For records without income, it is \(12/60=0.20\), or 20%.

Step 3: Interpret the comparison. The observed event proportion is 10 percentage points higher in the group with missing income. This is an unadjusted descriptive comparison; it does not show that missing income caused the difference, nor does it establish why income is missing.

A clear report could say: “Income was unavailable for 60 of 500 records (12%). The recorded event proportion was 20% among records with missing income and 10% among records with recorded income. Analyses requiring income use a selected subset, so their findings may not fully represent all records.” This avoids hiding the difference or claiming more than the counts support. The key mistake avoided is reporting only the 440 complete records as though their composition were necessarily representative of all 500.

Separate Unusual Values From Confirmed Errors

An extreme or surprising value is a reason to investigate, not automatic proof that the value is wrong. A valid but unusual observation may be important to the population being studied. A confirmed data-entry error may warrant correction if a reliable source supports the correction; otherwise, it may need to remain unresolved. The report should distinguish these cases and state whether the displayed result includes the observation.

Sensitivity checks can show how much a finding changes under a stated alternative treatment. They do not determine which treatment is correct. In particular, showing a result with and without an extreme record is not evidence that the record is invalid. The reason for the alternative treatment must be explicit, and the primary result should use the chosen, justified handling.

Worked Example: An Extreme Cost That Was Verified

A hypothetical review has 10 recorded costs. Nine are $100 each, and one is $1,000. Source documentation confirms that the $1,000 cost is valid, although it is unusually large. Calculate the mean including the verified value and the mean excluding it as a sensitivity comparison. No distributional assumption is made; these are the observed records.

Step 1: Calculate the total including all records. The nine ordinary costs sum to \(9\times \$100=\$900\). Adding the verified cost gives \(\$900+\$1{,}000=\$1{,}900\).

Step 2: Calculate the all-record mean. Divide by 10:

$$ \frac{\$1{,}900}{10}=\$190. $$

Step 3: Calculate the comparison excluding the unusual value. The remaining total is $900 across 9 records, so the comparison mean is \(\$900/9=\$100\).

The mean changes by \(\$190-\$100=\$90\) under this exclusion. Because the source review confirmed the $1,000 value, the report should not label it an error or silently omit it. It could state: “One of 10 costs was $1,000 and was verified against source documentation. The mean was $190 including that record; it would be $100 if the record were omitted. The primary summary retains the verified observation.” The sensitivity figure communicates influence without treating unusualness as invalidity.

Incomplete Outcomes Limit What Can Be Evaluated

A missing predictor value and an unavailable outcome are different reporting issues. Missing predictors may restrict which records can be used in an analysis requiring those predictors. Missing outcomes can make it impossible to determine whether an event occurred for certain records, limiting conclusions about event frequency or predictive performance. State how many outcomes are known and unknown, and avoid treating unobserved outcomes as negative outcomes.

When the outcome is binary and no assumptions are made about the unobserved outcomes, simple bounds can communicate the uncertainty in the overall event proportion. The lower bound counts every unknown outcome as no event; the upper bound counts every unknown outcome as an event. These bounds may be wide, but they make the information gap visible rather than concealing it.

Worked Example: Incomplete Follow-Up in a Validation Set

A hypothetical validation set contains 200 eligible records. Follow-up is complete for 150, among whom 12 events are recorded. The remaining 50 records have incomplete follow-up, so their event status is unknown. Calculate the observed event proportion among fully followed records and the assumption-free bounds for the event proportion across all 200 eligible records. Treat the counts as fixed; no distribution is assumed.

Step 1: Calculate the complete-follow-up proportion.

$$ \frac{12}{150}=0.08=8\%. $$

This 8% describes only the 150 records with complete follow-up.

Step 2: Calculate the lower bound across all eligible records. If none of the 50 unknown outcomes were events, there would be 12 events among 200 records:

$$ \frac{12}{200}=0.06=6\%. $$

Step 3: Calculate the upper bound. If all 50 unknown outcomes were events, there would be \(12+50=62\) events:

$$ \frac{62}{200}=0.31=31\%. $$

Thus, without assumptions about the unknown outcomes, the overall proportion could range from 6% to 31%. The 8% complete-follow-up proportion is not an estimate proven to represent all 200 records. A report should give the follow-up completeness and clarify that outcome-related conclusions apply to the observed validation records unless further assumptions or information justify broader interpretation. The mistake avoided is coding every unobserved outcome as “no event.”

Report Sensitivity Without Overstating It

A sensitivity result is useful when it answers a clear question: how much does a finding change under a plausible alternative handling decision? State the primary result, the alternative, and why the alternative is being shown. Keep the distinction between a diagnostic flag and a verified defect. If the alternative excludes a record only to illustrate influence, say that the exclusion is illustrative rather than a recommended correction.

For example, the root mean squared error is the square root of the mean of squared prediction errors. A large error can have a substantial effect because it is squared. That fact can motivate an influence check, but does not justify removing a record. Consider errors \(-2,1,1,2,9\). Using all five, the squared errors sum to \(4+1+1+4+81=91\), so the mean squared error is \(91/5=18.2\), and the root mean squared error is \(\sqrt{18.2}=4.266145\ldots\), or 4.266 to three decimals. Using only the first four as a sensitivity comparison gives a squared-error sum of 10, a mean of \(10/4=2.5\), and a root mean squared error of \(\sqrt{2.5}=1.581139\ldots\), or 1.581 to three decimals. The report should show the comparison without assuming that the error of 9 is invalid.

A common reporting trap is to remove an observation because it changes a summary substantially, then present the revised result as more trustworthy without evidence. The correction is to investigate the record, document what was verified, and report the primary handling transparently. If validity cannot be established, show an appropriate sensitivity comparison and retain the uncertainty in the interpretation.

What a Decision-Ready Data-Quality Note Includes

Include issues that could change how a reader interprets the population, comparison, or result. A minor formatting inconsistency with no effect on the analysis may not deserve space in the main report. A substantial missing-data pattern, an unresolved extreme record, or incomplete follow-up often does. The level of detail should be enough for a decision-maker to understand the limitation without implying that the analysis is unusable.

  • Extent: give counts and denominators, and identify the affected variable or outcomes.
  • Handling: say what was retained, excluded, corrected, or left unresolved, and why.
  • Implication: identify which reported findings or population claims may be affected.
  • Uncertainty: distinguish observed facts from plausible effects that the data cannot establish.

This approach is aligned with the SOA Exam PA (Predictive Analytics) syllabus because it connects analytical choices to responsible interpretation. A concise, contextual limitation is more useful than either silence or an unprioritized list of every data irregularity.

Check Your Understanding

For each case, calculate the requested quantity and identify the reporting caution.

  1. A hypothetical study has 360 records, with income missing for 45. What percentage is missing? (Answer: \(45/360=12.5\%\).)
  2. Among 80 records with a recorded cost, 70 costs are $120 each and 10 are $180 each. Calculate the observed mean and state one limitation if 8 additional records have missing costs. (Answer: \((70\times \$120+10\times \$180)/80=\$10{,}200/80=\$127.50\); the mean describes only the 80 observed costs, and the missing records may differ.)
  3. Eight verified records contain seven costs of $200 and one cost of $1,600. Calculate the mean with and without the unusual but valid value. (Answer: Including it, \((7\times \$200+\$1{,}600)/8=\$3{,}000/8=\$375\); excluding it as a sensitivity comparison, \(\$1{,}400/7=\$200\). Its influence does not show it is invalid.)
  4. Of 300 eligible records, outcomes are known for 240 and 18 events occurred among those 240. Find the assumption-free bounds for the event proportion across all 300. (Answer: Lower bound \(18/300=6\%\); upper bound \((18+60)/300=26\%\).)
  5. A validation set has errors \(-3,0,2,7\). Calculate the root mean squared error using all four and using only the first three as a sensitivity comparison. What caution should accompany the comparison? (Answer: All four: squared-error sum \(9+0+4+49=62\), mean \(62/4=15.5\), root mean squared error \(\sqrt{15.5}=3.937\) to three decimals. First three: sum \(13\), mean \(13/3=4.3333\ldots\), root mean squared error \(\sqrt{13/3}=2.082\) to three decimals. Report the comparison without assuming the error of 7 is invalid.)
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