Automated Systems: The Auditor's Role

A variety of approaches and techniques are used by the auditors and systems evaluators of GAO to review electronic data processing systems. From the standpoint of system logic, a system is fully designed when a programmer begins coding the programs. Review of system designs includes an evaluation of the network of system controls and audit trails; a determination of the degree of integrity maintained over the data in the files; and a determination that the automated system is designed in conformity with accounting specifications. Significant gaps in any of these areas could be a basis for disapproval of the system design. The reliability assessment technique is used to determine the degree of risk and the audit methodology. The reliability assessment technique aids in determining how much reliance can be placed on the following areas: top management oversight of electronic data processing functions; organizational structure, staffing, and administrative practices to control processing of data; general controls; and application controls. Methods that can be used to obtain evidence or assurance that controls are functioning include the evaluation of a sample of the automated records and test transactions. Auditors should make at least one unannounced visit to the data processing center to evaluate the adequacy of general controls.