AUDITING EDP SYSTEMS

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CHAPTER 15

• AUDITING EDP SYSTEMS

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EFFECT OF EDP ON ORGANIZATION

• ORGANIZATION CHANGE
• FACLITIES
• STAFFING
• CENTRALIZATION OF DATA AND SEGREGATION OF DUTIES
• METHODS OF AUTHORIZATION
• VISIBILITY
• INPUT DATA
• PROCESSING
• TRANSACTION TRAIL

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• POTENTIAL FOR MISSTATEMENT
• REDUCED HUMAN INVOLVEMENT
• UNIFORMITY OF PROCESSING
• UNAUTHORIZED ACCESS
• LOSS OF DATA
• POTENTIAL FOR IMPROVED CONTROL

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EDP CONTROLS

• GENERAL CONTROLS
• PLAN OF ORGANIZATION
• PROCEDURES FOR DOCUMENTING, APPROVING SYSTEMS AND
  PROGRAMS
• HARDWARE CONTROLS
• ACCESS CONTROLS
• APPLICATION CONTROLS
• INPUT CONTROLS
• PROCESSING CONTROLS
• OUTPUT CONTROLS

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UNDERSTANDING INTERNAL CONTROLS

• OBTAIN UNDERSTANDING
• FLOWCHARTS
• EDP QUESTIONNAIRES
• ERROR LISTINGS
• DOCUMENT UNDERSTANDING
• ASSESS CONTROL RISK

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TESTING CONTROLS

• AUDIT AROUND COMPUTER
• TREAT COMPUTER AS CLERK
• TEST SOURCE DOCUMENTS FOR EVIDENCE OF CONTROL
• AUDIT USING COMPUTER
• TEST DATA APPROACH
• INCLUDE ALL RELEVANT CONDITIOND
• CLIENT PROGRAM
• PARALLEL SIMULATION
• AUDITOR PROGRAM REPLICATES CLIENTS
• CLIENT DATA PROCESSED

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GENERALIZED AUDIT SOFTWARE

• AUDIT TOOL
• PERFORMS VARIOUS DATA MANIPULATION FUNCTIONS
• USING SOFTWARE
• OBJECTIVE SETTING
• APPLICATION DESIGN
• CODING
• KEY ENTRY
• PROCESSING

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• USES OF GENERALIZED AUDIT SOFTWARE
• VERIFY EXTENSIONS
• EXAMINE RECORDS FOR CORRECTNESS
• COMPARE DATA ON SEPARATE FILES
• SUMMARIZE OR REORDER DATA
• COMPARE AUDIT EVIDENCE WITH COMPANY DATA
• SELECT AUDIT SAMPLES
• PRINT CONFIRMATIONS

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MICROCOMPUTERS IN AUDITING

• USES OF MICROCOMPUTERS
• PREPARE TRIAL BALANCES AND LEAD SCHEDULES
• PREPARE WORKING PAPERS
• CALCULATE ANALYTICAL PROCEDURES
• PREPARE AUDIT PROGRAMS
• UNDERSTAND INTERNAL CONTROLS
• PERFORM AUDIT SAMPLING
• MANAGE ENGAGEMENTS