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Test Data Approach: Audit Through The Computer
Test Data Approach: Audit Through The Computer
No deducted IT personnel.
Accounting system retain much of the traditional source documents such as customer purchase order,
shipping and receiving records, sales and vendor invoices. Manual audit procedure.
Much of the tradition source documents such as customer purchase order, shipping and receiving
records, sales and vendor invoices, inventory listing, AR sub ledger etc. exist only electronically
Audit through the computer by using Computer Assisted Audit Techniques (CAAT):
Auditors process their own test data (transactions) using the client’s computer system and application
program.
The system is “expected” to accept or eject certain transactions. Invalid EE #s. excess hours, sales over
credit limit
Auditors compare the actual output to the expected output to assess the effectiveness of the
application program’s automated controls.
Test data should include all relevant conditions that the auditor wants tested. Auditors should design
test data to test all key computer-based controls and include realistic data that are likely to be a part of
the client’s normal processing including both valid and invalid transactions.
Application programs tested by auditor’s test data must be thee same as those the client used
throughout the year. Otherwise useless.
Test data must be eliminated from the client’s records. Reverse the effect of the test
Assume the client’s payroll application contains a limit check that disallows a payroll transaction that
exceeds 80 hours per week.
Auditor prepares payroll transactions with 79, 80 and 81 hours for each sampled week and process them
through the client’s system.
If the limit check control is operating effectively, the client’s system should reject the transaction for 81
hours, and the client’s error listing should report the 81 hour transaction error.
TRANSACTION TAGGING
Transaction tagging is where a transaction record is “tagged” and then traced through critical points in
the information system.
PARALLEL SIMULATION:
Auditors often use auditor-controlled software to do the same operations that the client’s software
does, using the same data files (customer)
Example, Audit Command Language (ACL) and Interactive Data Extraction and Analysis (IDEA)
No need to learn how to use the client hardware and software systems