Question

Why are auditors interested in the controls associated with information technology? How do auditors use technology to conduct audits? Do most auditors use audit software when conducting an audit?

Answer 1

Basically an organisation would involve different kind of processes and systems having regard to its nature of operational activities.Apart from the information flow there maybe various other operational activities process and departments such as production, sales, maintanence , research and development etc. which have been interconnected by various systems and software and applications running on such systems.This explains the need for auditor to be familiar with the computerized environment and their controls associated with them.Although the auditors field of interest covers mostly the financial and business aspects, he will also be concerned with the other department and accounting information generated by other departments.And therefore it becomes the auditors responsibility that the information used in giving his opinion is reliable which again depends on reliable on the internal control system and its effectiveness.

In the recent days, the audit trial is not readily available as it was in the early stages , hence the auditor will have to use technology to ensure that the systems input, processing and output are complete, accuarate and reliable, thereby ensuring that the rest of the transactions are also reliable, as it is not possible that the auditor dos 100 % checking of the transactions.

In the absence of audit audit trial the auditor uses computer assisted audit techniques(CAAT's)ie., computer as an audit tool.like audit test data specially designed to check all the limiting controls within the system, audit software for sampling , utility programs for common data and processing etc.

Most auditors use software due to the inevitable situation of complexity involved in checking manually   but Not all the auditors software as an audit tool or is required to check IT controls, where the organisation is very small without the use of IT or the organisation uses IT for very limited tasks and audit trail is completely visible , and use of software and other tools is highly unnecessary that the cost far exceeds its benefits.