Question

1a. Can we describe and discuss some of the computer assisted audit technics available to the auditor today?

b.   What kind of evidential matter would the auditor require to support accuracy of cash balance? -Discuss

c. What kind of evidential matter would the auditor require to support the existence inventory of gold coins? -Discuss

Answer 1

ANSWER-1)

The use of audit software by auditors is known as computer-assisted audit technique (CAAT). When using CAATs, auditors are required to determine the goals of the audit, learn about the files and databases that are being audited, designing of the required audit reports, and finally how to produce them. The main computer assisted audit techniques available to the auditor today are discussed as follows:

--Test data: Test data technique is based on auditors’ input data creation which must be processed by the application of client. It consists of correct as well as incorrect data. When incorrect data is entered into the system, the input rejection is expected by auditor. The expected behavior and results of input procedures are compared to check whether input controls are in place.

-- Integrated test facility: These facilities are built-in test environments within a system. It is used mainly with large-scale, online systems serving various locations within the organization or company. .

-- Parallel simulation: In the above discussed two techniques audit tests are based on simulated data, however parallel simulation technique auditor uses actual data which is processed with clients’ and auditor’s program. Afterwards the results are compared and validated.

-- Online audit monitor: These provides continuous audit by integration of audit program code into client’s transactional application. The primary motive is to monitor transactions and makes extractions if specific criteria are met (specific transactions, high risk transactions, unusual transactions, etc.).