A.I.S. Class 18: Outline I Learning Objectives for Chapter 11 I - - PowerPoint PPT Presentation

November 6, 2000

• Dr. Peter R Gillett

1

A.I.S. Class 18: Outline

I Learning Objectives for Chapter 11 I Information Systems Auditing I Group Work for Chapter 11 I CLASSROOM PRESENTATION 4

November 6, 2000

• Dr. Peter R Gillett

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Learning Objectives for Chapter 11

I After studying this chapter you should be

able to:

Ndescribe the types of audits and auditors Nprovide an overview of the audit process for

financial statement audits

Ndescribe the effects of computerization on the

accounting process

Nbriefly describe the audit process for financial

statement audits

November 6, 2000

• Dr. Peter R Gillett

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Learning Objectives for Chapter 11

Ndescribe the essence and issues concerning the

impact of SAS No. 55 on computer auditing

Ndescribe various computer auditing techniques and

how they could be applied in database environments

Ndistinguish between auditing around, auditing with

and auditing through the computer

Nexplain the process of auditing a relational DBMS Ndescribe the implications of information technology

• n computer auditing

November 6, 2000

• Dr. Peter R Gillett

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Information Systems Auditing

I Types of Audits

F External Audits F Internal Audits

NOperation of Internal Controls NManagement or Operational

F Compliance Audits

November 6, 2000

• Dr. Peter R Gillett

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Information Systems Auditing

I Audit Steps

F Establish Audit Objectives F Perform Audit Procedures F Evaluate Audit Evidence F Develop an Audit Opinion F Communicate Audit Results

November 6, 2000

• Dr. Peter R Gillett

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Information Systems Auditing

I Effects of Computerization

F Decreased processing visibility F Data only in computer-readable form F Loss of visible audit trail F Extreme consequence of program errors F Lack of common sense F Increase in value of average fraud losses

November 6, 2000

• Dr. Peter R Gillett

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Information Systems Auditing

I Offsetting benefits

F Improved prevention F Electronic audit trail F Computer-assisted audit techniques

November 6, 2000

• Dr. Peter R Gillett

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Information Systems Auditing

I SAS 48

F The auditor must assess

Nthe extent of computerization of accounting Nthe complexity of computer-based systems Nthe degree to which audit evidence is in computer-

readable form only

F and identify

Ncomputer-based controls

November 6, 2000

• Dr. Peter R Gillett

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Information Systems Auditing

I SAS 55 (& 78)

F Internal Control Structure F AR = IR x CR x DR

NAR: Audit Risk NIR: Inherent Risk NCR: Control Risk NDR: Detection Risk

F Document understanding of internal control

structure

F Assess control risk (and test controls)

November 6, 2000

• Dr. Peter R Gillett

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Information Systems Auditing

I Audit approaches and Computer Audit

F Auditing around the computer F Auditing through the computer

N Test data N Integrated Test Facility (ITF) N Embedded Audit Module N Mapping N Source code comparison N Parallel simulation

F Auditing with the computer

November 6, 2000

• Dr. Peter R Gillett

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Information Systems Auditing

I Auditing with the computer

F Utility programs F DQL (e.g., QBE in ACCESS) F Generalized Audit Software

N Data retrieval N Calculations N Edit checks N Reformatting N File operations N Statistics N Reports

November 6, 2000

• Dr. Peter R Gillett

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Information Systems Auditing

I Advanced Technology Environments

F Concurrent auditing F Expert systems F Audit program generators F Audit workpapers F PC-based reference software

November 6, 2000

• Dr. Peter R Gillett

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Group Work for Chapter 11

I Discussion Questions I Problems 6 & 7

November 6, 2000

• Dr. Peter R Gillett

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CLASSROOM PRESENTATION

I Group Project Stage 4