Podcast
Questions and Answers
What is the primary focus of a financial audit?
What is the primary focus of a financial audit?
- Evaluating the systematic process of the information system
- Ensuring proper implementation of computer resources
- Analyzing the logical framework for conducting an audit in an IT environment
- Assessing internal controls and compliance with regulatory standards (correct)
Why is a systematic approach particularly important in an IT environment audit?
Why is a systematic approach particularly important in an IT environment audit?
- To comply with generally accepted accounting principles
- To identify all essential processes and data files without physical verification (correct)
- To ensure proper implementation of computer resources
- To evaluate the logical framework for conducting the audit
What is the main focus of an auditing process in a CIS environment?
What is the main focus of an auditing process in a CIS environment?
- Assessing internal controls and guidelines of computer-based systems (correct)
- Analyzing industry requirements for financial statements
- Ensuring compliance with financial auditing standards
- Evaluating the systematic process for financial audits
How does an IT audit differ from a financial audit?
How does an IT audit differ from a financial audit?
Why is the lack of physical procedures a challenge in an IT audit?
Why is the lack of physical procedures a challenge in an IT audit?
What makes the IT audit a significant component of external and internal audits?
What makes the IT audit a significant component of external and internal audits?
What is the main task of the auditor in relation to management assertions?
What is the main task of the auditor in relation to management assertions?
When auditors perform tests of controls, what are they primarily trying to establish?
When auditors perform tests of controls, what are they primarily trying to establish?
Which of the following is NOT one of the basic components of management assertions about financial statements?
Which of the following is NOT one of the basic components of management assertions about financial statements?
What does the auditor seek when obtaining evidence in an audit?
What does the auditor seek when obtaining evidence in an audit?
In the IT environment, what type of evidence do auditors gather related to computer controls?
In the IT environment, what type of evidence do auditors gather related to computer controls?
What is a key judgment that auditors need to make in all audit environments?
What is a key judgment that auditors need to make in all audit environments?
Flashcards are hidden until you start studying
Study Notes
Financial Audit vs. CIS Audit
- Financial auditing is a business method that ensures a corporation's internal controls, guidelines, mechanisms, and policies are adequate, functional, and in compliance with regulatory standards.
- Financial auditing applies GAAS to ensure that financial statements are accurate, complete, and in compliance with generally accepted accounting principles (GAAP).
CIS Audit
- A CIS audit focuses on the computer-based aspects of an organization's information system.
- It assesses the proper implementation, operation, and control of computer resources.
Basic Components of an Audit
- Systematic Process: Conducting an audit is a systematic and logical process that applies to all forms of information systems.
- Management Assertions: The organization's financial statements reflect a set of management assertions about the financial health of the entity, including:
- Existence or Occurrence
- Completeness
- Rights and Obligations
- Valuation or Allocation
- Presentation and Disclosure
- Obtaining Evidence: Auditors seek evidential matter that corroborates management assertions, including:
- Gathering evidence relating to the reliability of computer controls
- Gathering evidence relating to the contents of databases that have been processed by computer programs
- Ascertaining Materiality: The auditor must determine whether weaknesses in internal controls and misstatements found in transactions and account balances are material, which is an auditor judgment.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
