Essay on Audit Proposal

1327 Words Apr 1st, 2011 6 Pages
Team C analyzed the accounts payable, accounts receivable, payroll, and inventory systems for Kudler Fine Foods. Kudler would now like to see a proposed audit schedule for these systems. The team will distinguish between the types of audits that may use for each process. The team will also recommend the most appropriate audit for each process and explain how to conduct the audits. Identifying events that may prevent reliance on auditing through the computer will also be presented to Kudler for review (Apollo Group, 2009).
Types of Audits The types of information technology audits are attestation, findings and recommendations, SAS 70 audits, and SAS 94 audits. If Kudler wants the auditor to provide an assurance for each of the
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219). SAS 94 requires auditors to gain an understanding of the client’s information system, consider how a client’s IT processes affect internal control, and gain an understanding of how journal entries are processed (Hunton et al., 2004). A SAS 94 audit is part of a regular financial audit. Therefore, this type of audit could be beneficial for providing Kudler with useful information about each of the four systems. Recommended Audit Kudler can use all four types of information technology audits which are attestation, findings and recommendations, SAS 70 and SAS 94. Because Kudler uses a Retail Enterprise Management System (REMS), they can audit their payroll, inventory, accounts receivables, and accounts payables all in one system. The SAS 94 audit deals with electronic records rather than paper documents. The payroll, inventory, accounts receivables, and accounts payable are done electronically and can produce paper documentation.

The ERP software has Kudler’s contracts and automatic billing for online customers. The system generates reports for the management team for strategic planning. The auditors will need to know and understand the invoicing process within the ERP to conduct the audit. The audit of the payroll and accounts payable process should follow the same audit process of the accounts

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