Do Auditors Need to Have in-Depth Knowledge of Information Technology?

New audit technologies assist in audit. It make the audit well organized and best results are achieved efficiently and effectively. The auditor uses computer assisted technique to perform the audit. The ultimate purpose for the use of technology is for a faster and more efficient audit process.

Auditors should always evaluate the design and test the operating effectiveness of a company’s internal control. The key procedures of the evaluation of design are fulfilled by inquires, observations, and inspections. The same procedures can be used to test the operating effectiveness as well.

Due to increasing economic and financial growth, many types of audit have been incorporated throughout the development process of internal activities. Audits can be performed manually or they can incorporate technology. According to Hunton and

Using the force of online IT frameworks, CA gives the possibility to a more extensive arrangement of affirmation reports incorporating a more extensive arrangement of variables, alarms and systematic techniques than the present arrangement of commanded yearly money related reviews. CA augments the investigative strategies for customary inspecting and in addition presents new types of examination by looking at consistent streams of information, with models of framework conduct used to set up desires for information content. A noteworthy facilitator for CA is the execution of a checking and control (MC) layer, which joins different IT frameworks in an organization into one coordinated stage that considers consistent constant data trade. ERP frameworks consider a phenomenal level of computerization and combination and generously encourage the production of the MC layer. In any case, it is unequivocally that certainty that CA frameworks will be based upon ongoing observing of the organization's exchanges and control frameworks that may carry CA into struggle with Section 201. Likewise with element era of data in reviewing, CA would then prompt the production of new data about the organization. In this manner the CA framework can furnish data with genuine operational results, which darkens the line amongst reviewing and control observing. While a CA framework does not

1.1 This report has been prepared to cover the assessment criteria requirements of AAT learning and assessment area ‘internal control and accounting system.

Section 404. Management assessment of internal control: This section needs every annual report of a in public listed company to contain internal control report stating management’s responsibility to establish and maintain an adequate system of internal control financial reporting similarly as an assessment of the effectiveness of internal control structure and procedures. Auditors audit the financial statements of the company must issue a consulting report regarding the effectiveness of the company internal

If an auditor uses audit production software, they should notice and increase in effectiveness and productivity. Automation of data can save an auditor time and effort. Also, the CAAT can mismatch items and regulatory issues. Another advantage an auditor gains are electronic working papers, groupware, time and billing, reference libraries and document management. Electronic paper increases productivity because the auditor no longer is spending time on manually auditing work papers (Hunton 2004). Groupware allows sharing of information across firms and between the auditor and the clients (Hunton 2004). Time and billing software can ease the formerly erroneous process of accounting for chargeable hours and compiling and preparing bills

The audit will become a strong tool for feeding a continual improvement method and providing recognition for excellence in any organization. Eminent implementation of AN audit method needs managers to line positive expectations concerning however audits are going to be conducted, choose vital areas for audits, give positive communication concerning the aim of the audit findings, and involve individuals in following informed the audit findings. The audit ought to be seen as a way for distinctive each opportunities for improvement and areas of excellence that merit reward and recognition.

In addition to the audit plan for the analyzed processes, of Kudler Fine Foods, encouragement of ways to improve audit documentation and process, by using computer technology was addressed to Kudler’s management team. As a result, Kudler Fine Foods management team is considering incorporating proposed computer assisted auditing techniques (CAATs) within its systems. CAATs will increase efficiency levels of an auditor’s personal productivity during analysis and data extraction of the audit which is beneficial to the performance of Kudler. CAAT will also service as a validation agent providing assurance of data integrity and reliability to the operations of Kudler Fine Foods for its users. CAAT surfaces inconsistencies that can

The addition of computer technology in accounting systems has not only changed the way information is accessed, stored, and controlled, but encouraged auditors to become familiar with accounting technology and software. Entities using technology for information management provided a different perspective to the role IT played in accounting. At an accelerated pace, auditors need to become educated on capturing and analyzing information technology. While training and professional performance of an auditor are addressed in the standards, the AICPA has not updated this standard since 1975 (Krahel and Titera, 2015). Auditing Standard 1010: Training and Proficiency of the Independent Auditor requires an audit "to be performed by a person or persons having adequate technical training and proficiency as an auditor" became a guideline for auditor knowledge and professional development (Public Company Accounting Oversight

Forensic accountants need analytical skills because as they review financial reports and other source documents, they need to analyze the validity of each transaction and determine if the company recorded the transaction fairly. The forensic accountant needs the ability to analyze where the data came from and whether the data accurately reflects the numbers posted in the financial reports (McIntosh, n.d.). With an in house forensic accountant, this will ensure the company’s financial state is accurately reflected while an independent forensic accountant can verify the accuracy of the reports, both of which help investors determine if the company is worth investing in.

This practice is addressed here on account of the capacity of the free market to rebuff auditor failure; the dynamism indicated by members in connection to the deliberate appropriation of new self-administrative approaches and the high costs and questionable adequacy of the new regulations embraced (Arruñada 2004). A more reasonable methodology that would give the business time to find the productive blend of administrations, quality shields what 's more, firm structures is exhorted (Arruñada 2004). Current administrative propensities, the primary component of which is obligatory evaluating, safeguarding against threats and progressively incapable regulation.

The table above depicts the overall auditing process. Each time an audit has been conducted it has been given a unique audit ID number so it is easier to lookup. The table also shows the manufacturing sites, which must be audited with a manufacturing ID as well as auditor ID. There is a start date and end date as well as a project price for the audit process. This table can be connected to the manufacturing sites table by linking manufacture ID.

However, the constant growing and changing field of IT has had an important impact on all levels of the firm’s organization. In this context, the term "information management" has emerged as the most common name. As rue result, management information systems were developed to support the new role of accountant. This new role forced accountants to become the interpreter of information and to deal with the information overload. Now, the accounting department is now responsible to

When analyzing a copy for the means of producing a deliverable audit report, there are a few details that must be considered first. One of the important aspects to increase risk awareness and improve upon the current operations. To convey this thru the reporting, it is important to know the organizations reporting practices; when and to who do they report the finding to? Once the auditor has this information, they need to determine the objective for the audit. Knowing this information will help to determine the approach to take. Next a structure will need to be developed; how will the audit report be communicated? This is a vital step when conveying potentially intricate detail, it must be clear to the receiver. The auditor