The data may be transaction data, on which the auditor wishes to perform tests of controls or substantive procedures, or they may be other kinds of data.
For example, details of the application of some general controls may be in the form of text or other files by applications that are not part of the accounting system. The auditor can use CAATs to review those files to gain evidence of the existence and operation of those controls. Order custom essay Computer Assisted Audit Techniques with free plagiarism report. The major steps to be undertaken by the auditor in the application of a CAAT are to: a.
Set the objective of the CAAT application b. Determine the content and accessibility c. Identify the specific files or database to be examined d. Understand the relationship between the data tables where a database is to be examined e. Define the specific tests or procedures and related transactions and balances affected f.
Define the output requirements g. Arrange with the user and IT departments, if appropriate, for copies of the relevant files or database tables to be made at the appropriate cutoff date and time h.
Identify the personnel who may participate in the design and application of the CAAT i. Refine the estimates of costs and benefits j. Ensure that the use of CAATs is properly controlled and documented k. Arrange the administrative activities, including the necessary skills and computer facilities l. Reconcile data to be used for the CAAT with the accounting records m. Execute the CAAT application; and n.
Evaluate the results. Where smaller volumes of data are processed, manual methods may be more cost effective.
A small entity may not be able to provide adequate technical assistance to the auditor, making the use of CAATs impracticable. Certain audit package or generalized audit software may not operate small computers, thus restricting the auditor's choice of CAATs.
Are tools used by auditors that facilitate their productivity by automating the auditing function and lessen the amount of time they spend on other administrative tasks.
These tools include electronic working paper, groupware, engagement management, reference libraries and document management. Is the tool use by the auditors to automate different audit task. Design to read, process and write data with the aid of functions performing specific audit routines and with self-made macros.
Two General Approaches — Black box around the computer approach - White box through the computer approach. Auditors do not just rely on a detailed knowledge of the application's internal logic. Instead, they seek to know the functional characteristics of the application by analyzing flowcharts and interviewing knowledgeable personnel in the client's organization. The purpose of this Philippine Auditing Practice Statement is to give guidance to assist auditors of financial statements where an entity engages in commercial activity that takes place by means of connected computers over a public network.
The purpose of the auditor's consideration is not to make an opinion or provide consulting services regarding the entity's e-commerce systems.
The internet refers to the worldwide network of computer networks that is nowadays very useful to the public. Add New Comment. Start free Ready Ratios financial analysis now! Login to Ready Ratios. If you have a Facebook or Twitter account, you can use it to log in to ReadyRatios:.
Enter your login:. Enter your password:. Stay signed in. Login As. Use your Facebook. Use your Twitter. Embedded audit software - this requires a purpose written audit program to be embedded into the client's accounting system. The program will be designed to perform certain tasks similar to audit software with the advantage that it can be turned on and off at the auditor's wish throughout the accounting year. This will allow the auditor to gather information on certain transactions perhaps material ones for later testing and will also identify peculiarities that require attention during the final audit.
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