AUDITING+ASSURANCE 12MONTH ACCESS CARD
17th Edition
ISBN: 9780135635131
Author: ARENS
Publisher: WILEY
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Chapter 25, Problem 15RQ
To determine
Identify the options to obtain assurance about the embedded in payroll application.
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In the event of payroll fraud, discuss the suggestion that the human elements of control systems are frequently more important than the software elements in ensuring that records are correct.
Discuss the risks depicted by the payroll system flowchart. Describe the internal control improvements to the system that are needed to reduce these risks.
1.Explain the relation ship between application controls and transaction related audit objectives .
2.explain what is meant by auditing around the computer and describe what must be present for this approach to be effective when auditing clients who use IT to process accounting information
3.explain what meant by the test data approach. What are the major difficulties with using this approach?define parallel simulation with audit software and provide an exmaple of how it can be used to test a client's payroll system
4.describe risks that are associated with purchasing software to be installed on desktop computer hard drives.what precautions can clients take to reduce those risks?
5.compare the risks associated with network systems to those associated with centralized IT functions
6.how does the use of a database management system affect risks?
7.an audit client is in the process of creating an online web-based sales ordering system for customers to purchase products using personal…
Chapter 25 Solutions
AUDITING+ASSURANCE 12MONTH ACCESS CARD
Ch. 25 - Prob. 1RQCh. 25 - Prob. 2RQCh. 25 - Prob. 3RQCh. 25 - Prob. 4RQCh. 25 - Prob. 5RQCh. 25 - Prob. 6RQCh. 25 - Prob. 7RQCh. 25 - Prob. 8RQCh. 25 - Prob. 9RQCh. 25 - Prob. 10RQ
Ch. 25 - You have been asked to provide assurance on...Ch. 25 - Prob. 12RQCh. 25 - Prob. 13RQCh. 25 - Prob. 14RQCh. 25 - Prob. 15RQCh. 25 - Explain what is meant by prospective financial...Ch. 25 - Prob. 17RQCh. 25 - Prob. 18.1MCQCh. 25 - Prob. 18.2MCQCh. 25 - Prob. 18.3MCQCh. 25 - Prob. 19.1MCQCh. 25 - Prob. 19.2MCQCh. 25 - Prob. 20.1MCQCh. 25 - Prob. 20.2MCQCh. 25 - Prob. 21.1MCQCh. 25 - Prob. 21.2MCQCh. 25 - Prob. 21.3MCQCh. 25 - You are doing a review services and related tax...Ch. 25 - Prob. 23DQPCh. 25 - Prob. 24DQPCh. 25 - Prob. 25DQPCh. 25 - Prob. 27DQPCh. 25 - Prob. 28DQPCh. 25 - Prob. 29DQPCh. 25 - Prob. 30DQP
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- Your client has outsourced the majority of the accounting information system to a third-party data center. What impact does that have on your audit of the financial statements?arrow_forwardCPAs may audit around or through computers in the audit of the financial statements of clients who use IT to process accounting data. d. How can the CPAs be satisfied that the computer programs presented to them for testing are actually those used by the client for processing accounting data?arrow_forwardFlowchart Control Points. Each number of the flowchart in Exhibit H.53.1 identifies a control point in the computerized payroll processing system. List the control points and, for each point, describe the type of internal control procedure that should be implemented.arrow_forward
- CPAs may audit around or through computers in the audit of the financial statements of clients who use IT to process accounting data. c. In auditing through the computer, CPAs may use test data. (1) What are test data? (2) Why do CPAs use test data?arrow_forwardIf a client relies on information technology (IT) controls and the auditor plans to assess control risk as low for payroll assertions, the auditor will usually do all of the following, EXCEPT _______. --test the effectiveness of manual controls --use computer-assisted audit techniques (CAATs) to evaluate the effectiveness of IT application controls --test the effectiveness of manual procedures to follow up on exceptions --All of the answer choices are correct.arrow_forwardCPAs may audit around or through computers in the examination of financial statements of clients who utilize computer to process accounting data. Required: Describe the auditing approach referred to as auditing around the computer.arrow_forward
- PAYROLL FLOWCHART ANALYSIS Discuss the risks depicted by the payroll system flowchart for this problem.Describe the internal control improvements to the system that areneeded to reduce these risks.arrow_forwardWhat functions can be performed by an automated payroll system?arrow_forwardCPAs may audit around or through computers in the examination of financial statements of clients who utilize computer to process accounting data. Required: Under what condition does the CPA decide to audit through the computer instead of around the computer?arrow_forward
- Explain in detail how the following relate to Advanced Technology Payroll Systems: Human Resources, Cost Accounting, Employee Timekeeping, Data Processing. Explain the following: Time and Attendance File, Biometric Time Clock, Magnetic Swipe ID Cards, Proximity Cards, Mobile Remote Devices. What are the payroll systems risks and internal controls?arrow_forwardWhat are the most common errors and frauds in the personnel and payroll cycle? Which control characteristics are auditors looking for to prevent or detect these errors and frauds?arrow_forwardWhich of the following is an example of an input control? a.making sure report that are distributed to the proper people b.monitoring the work of data entry clerks. c. Collecting accurate statistics of historical transactions while gathering data. d. Performing a check-digit test on a customer acount number e.Having anothr person review the design of a business formarrow_forward
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