Internal Audit ( PDFDrive )

P1: OTA/XYZ P2: ABC FM JWBK297-Coderre October 16, 2008 13:3 Printer Name: Yet to Come Internal Audit i P1: OTA/XYZ P2: ABC FM JWBK297-Coderre October 16, 2008 13:3 ii Printer Name: Yet to Come P1: OTA/XYZ P2: ABC FM JWBK297-Coderre October 16, 2008 13:3 Printer Name: Yet to Come Internal Audit Efficiency through Automation DAVID CODERRE John Wiley & Sons, Inc iii P1: OTA/XYZ P2: ABC FM JWBK297-Coderre Copyright
C October 16, 2008 13:3 Printer Name: Yet to Come 2009 by John Wiley & Sons, Inc All rights reserved Published by John Wiley & Sons, Inc., Hoboken, New Jersey Published simultaneously in Canada No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600, or on the web at www.copyright.com Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permissions Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose No warranty may be created or extended by sales representatives or written sales materials The advice and strategies contained herein may not be suitable for your situation You should consult with a professional where appropriate Neither the publisher nor author shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages For general information on our other products and services, or technical support, please contact our Customer Care Department within the United States at (800) 762-2974, outside the United States at (317) 572-3993 or fax (317) 572-4002 Wiley also publishes its books in a variety of electronic formats Some content that appears in print may not be available in electronic books For more information about Wiley products, visit our web site at http://www.wiley.com Library of Congress Cataloging-in-Publication Data: Coderre, David G Internal audit : efficiency through automation / David Coderre p cm Includes bibliographical references and index ISBN 978-0-470-39242-3 (cloth) Auditing, Internal–Data processing Risk assessment–Data processing I Title HF5668.25.C628 2009 657’.450285–dc22 2008037345 Printed in the United States of America 10 iv P1: OTA/XYZ P2: ABC FM JWBK297-Coderre October 16, 2008 13:3 Printer Name: Yet to Come For Anne, Jennifer and Lindsay This book celebrates the spirit of all auditors who are trying to the best job they can with the tools available to them and who are continuously searching for “better ways.” David Coderre E-mail: Dave Coderre@hotmail.com v P1: OTA/XYZ P2: ABC FM JWBK297-Coderre October 16, 2008 13:3 Printer Name: Yet to Come Internal auditors cannot stand by and watch as the business world embraces new technology The tools and techniques used in the past are no longer adequate; we need to restock our toolboxes with a variety of software to meet the challenges of auditing in today’s business environment David Coderre vi P1: OTA/XYZ P2: ABC FM JWBK297-Coderre October 16, 2008 13:3 Printer Name: Yet to Come About The Institute of Internal Auditors he Institute of Internal Auditors (IIA) is internationally recognized as a trustworthy guidance-setting body Serving members in 165 countries, The IIA is the internal audit profession’s global voice, chief advocate, recognized authority, acknowledged leader, and principal educator on governance, risk, and internal control The IIA sets, stewards, and promulgates the International Standards for the Professional Practice of Internal Auditing (Standards) The Institute also provides various levels of accompanying guidance; offers leading-edge conferences, seminars and Web-based training; produces forward-thinking educational products; offers quality assurance reviews, benchmarking, and consulting services; and creates growth and networking opportunities for internal auditors throughout the world The IIA also certifies professionals R R (CIA
), and through the globally recognized Certified Internal Auditor
provides specialty certifications in government, control self-assessment, and financial services The IIA’s Web site, www.theiia.org, is rich with professional guidance and information on IIA programs, products, and services, as well as resources for IT audit professionals The Institute publishes Internal Auditor, an award-winning, internationally distributed trade magazine and The IIA’s other outstanding periodicals address the profession’s most pressing issues and present viable solutions and exemplary practices The IIA Research Foundation (IIARF) works in partnership with experts from around the globe to sponsor and conduct research on the top issues affecting internal auditors and the business world today Its projects advance the internal audit profession globally by enhancing the professionalism of internal audit practitioners It also provides leading-edge educational products through the IIARF Bookstore T vii P1: OTA/XYZ P2: ABC FM JWBK297-Coderre October 16, 2008 13:3 viii Printer Name: Yet to Come P1: OTA/XYZ P2: ABC FM JWBK297-Coderre October 16, 2008 13:3 Printer Name: Yet to Come Contents xv Case Studies Preface xvii Acknowledgments xxi CHAPTER CHAPTER CAATTs History The New Audit Environment The Age of Information Technology Decentralization of Technology Absence of the Paper Trail Do More with Less Definition of CAATTs Evolution of CAATTs Audit Software Developments Historical CAATTs Test Decks Integrated Test Facility (ITF) System Control Audit Review File (SCARF) Sample Audit Review File (SARF) Sampling Parallel Simulation Reasonableness Tests and Exception Reporting Traditional Approaches to Computer-Based Auditing Systems-Based Approach Data-Based Approach Audit Management and Administrative Support Roadblocks to CAATT Implementation Summary and Conclusions 3 4 8 9 10 10 11 12 12 15 19 20 24 Audit Technology 27 Audit Technology Continuum Introductory Use of Technology 27 27 ix ... Developments Historical CAATTs Test Decks Integrated Test Facility (ITF) System Control Audit Review File (SCARF) Sample Audit Review File (SARF) Sampling Parallel Simulation Reasonableness Tests and Exception... Data: Coderre, David G Internal audit : efficiency through automation / David Coderre p cm Includes bibliographical references and index ISBN 978-0-470-39242-3 (cloth) Auditing, Internal? ??Data processing... Auditors he Institute of Internal Auditors (IIA) is internationally recognized as a trustworthy guidance-setting body Serving members in 165 countries, The IIA is the internal audit profession’s global