Internal Audit

Internal Audit: Efficiency Through Automation teaches state-of-the-art computer-aided audit techniques, with practical guidelines on how to get much needed data, overcome organizational roadblocks, build data analysis skills, as well as address Continuous Auditing issues. Chapter 1 CAATTs History, Chapter 2 Audit Technology, Chapter 3 Continuous Auditing, Chapter 4 CAATTs Benefits and Opportunities, Chapter 5 CAATTs for Broader Scoped Audits, Chapter 6 Data Access and Testing, Chapter 7 Developing CAATT Capabilities, Chapter 8 Challenges for Audit,

Autorentext

David Coderre has over twenty years of experience in
internal audit, management consulting, policy development,
management information systems, system development, and application
implementation areas. He is currently President of CAATS
(Computer-Assisted Analysis Techniques and Solutions). He is the
author of three highly regarded books on using data analysis for
audit and fraud detection.

Klappentext
Praise for Internal Audit: Efficiency through Automation "Internal audit's role within the organization is more visible than ever before, largely due to the intense regulatory and compliance pressures of the last few years. This book provides an excellent overview of technology's historical role in supporting audits, and practical examples of the value audit technology provides today. It should be mandatory reading for every audit leader tasked with maximizing the effectiveness of his or her audit team to support high- performing organizations."
Harald Will, President and CEO, ACL Services Ltd.

"A wonderful desktop reference for anyone trying to move from traditional auditing to integrated auditing. The numerous case studies make it easy to understand?and provide?a how-to?for those?seeking to?implement automated tools including continuous assurance. Whether you are just starting down the path or well on your way, it is a valuable resource."
Kate M. Head, CPA, CFE, CISA, Associate Director, Audit and Compliance, University of South Florida

"In the many years that it has been my pleasure to know and work with David Coderre, I have always been extremely impressed with his grasp of auditing, risk assessment, and data analytics, but more importantly how to do it all better and faster. If you want a high-quality audit outcome and effective resource utilization, learn from the best it doesn't get any better!"
Greg Duckert, CIA, CISA, CPA, CMA,?CEO and founder, Virtual Governance Institute

"'Do more with less.' A familiar phrase, but David Coderre actually shows you how to use technology to enhance your audit product. A must-read for any size audit shop."
Ian Craigen, Supervising Senior: IS Audit

"David Coderre is the ultimate expert on the use of computer-assisted audit tools and techniques. His twenty-first-century methods are revolutionizing the way audits are conducted. We have used his recommended methods in our audit practice with great success for many years. Every audit organizationinternal, external, governmental, SEC, or non-issuerof every size should have David's books in use. These ideas work."
David L. Cotton, CPA, CFE, CGFM, Chairman, Cotton & Company LLP

Inhalt

Case Studies xv

Preface xvii

Acknowledgments xxi

CHAPTER 1 CAATTs History 1

The New Audit Environment 2

The Age of Information Technology 3

Decentralization of Technology 3

Absence of the Paper Trail 4

Do More with Less 4

Definition of CAATTs 5

Evolution of CAATTs 6

Audit Software Developments 7

Historical CAATTs 8

Test Decks 8

Integrated Test Facility (ITF) 9

System Control Audit Review File (SCARF) 9

Sample Audit Review File (SARF) 9

Sampling 10

Parallel Simulation 10

Reasonableness Tests and Exception Reporting 11

Traditional Approaches to Computer-Based Auditing 12

Systems-Based Approach 12

Data-Based Approach 15

Audit Management and Administrative Support 19

Roadblocks to CAATT Implementation 20

Summary and Conclusions 24

CHAPTER 2 Audit Technology 27

Audit Technology Continuum 27

Introductory Use of Technology 27

Moderate Use of Technology 28

Integral Use of Technology 29

Advanced Use of Technology 30

Getting There 31

General Software Useful for Auditors 32

Word Processing 32

Text Search and Retrieval 34

Reference Libraries 35

Spreadsheets 35

Presentation Software 37

Flowcharting 38

Antivirus and Firewall Software 39

Software Licensing Checkers 39

Specialized Audit Software Applications 40

Data Access, Analysis, Testing, and Reporting 40

Standardized Extractions and Reports 44

Information Downloaded from Mainframe Applications and/or Client Systems 45

Electronic Questionnaires and Audit Programs 48

Control Self-Assessment 49

Parallel Simulation 50

Electronic Working Papers 51

Data Warehouse 52

Data Mining 54

Software for Audit Management and Administration 56

Audit Universe 56

Audit Department Management Software 57

E-mail 57

File Transfer Protocol (FTP) 57

Intranet 59

Databases 60

Groupware 61

Electronic Document Management 61

Electronic Audit Reports and Methodologies 62

Audit Scheduling, Time Reporting, and Billing 63

Project Management 64

Extensible Business Reporting Language (XBRL) 64

Expert Systems 67

Audit Early-Warning Systems 68

Continuous Auditing 69

Continuous Auditing versus ContinuousMonitoring 72

Example of Continuous Auditing: Application to an Accounts Payable Department 74

Stages of Continuous Auditing 77

Continuous Auditing Template 79

Sarbanes-Oxley 80

Important SOX Sections 81

The Role and Responsibility of Internal Audit 83

Risk Factors 84

Detecting Fraud 85

Determining the Exposure to Fraud 86

SOX Software 88

Assessment of IT Controls and Risks 90

Defining the Scope 92

GAIT Principles 93

Governance, Risk Management, and Compliance (GRC) 94

Internal Audit's Role in the GRC Process 97

Identifying and Assessing Management's Risk Management Process 99

Assessment of Internal Control Processes 100

GRC Software 101

Summary and Conclusions 102

CHAPTER 3 CAATTs Benefits and Opportunities 103

The Inevitability of Using CAATTs 103

The New IM Environment 105

The New Audit Paradigm 105

Expected Benefits 108

Planning PhaseBenefits 109

Conduct PhaseBenefits 112

Data Analysis 112

Increased Coverage 112

Better Use of Auditor Resources 115

Improved Results 116 Reporting PhaseBenefi...