Running head: AUDIT PROPOSAL 1

Audit Proposal

Maria Carolina Cortinas, Luis Castro, Mayra Núñez, Sharon Little, Stasha Kurtz

ACC/542

July 5, 2013

Dr Milan Havel

AUDIT PROPOSAL 2

Audit Proposal

Control procedures are important in the efficient operation of an accounting information

system (AIS). Organizations have audits to ensure procedures are functioning properly and there

is no need for additional controls. This research of internal, external, financial, risk assessment,

and information technology audits will examine and ensure that internal controls have been

correctly placed and properly functioning. Kudler Fine Foods can use audits for their systems’

processes, as they involve information technology.

Types of audits

Internal or external audit concerns employee adherence to company policies, procedures,

and development of internal controls. Audits on information technology involve the evaluation

of the computer’s role in achieving audit and control objectives. These audits encompass the

components of the computer-based AIS: people, procedures, hardware, data communications,

software, and databases. They are broad in scope and include auditing for fraud and ensuring that

employees are not copying software programs. The four types of information technology (IT)

audits are: Attestation, Findings and Recommendations, SAS 70 Audit, and SAS 94 Audit.

The three types of IT audits that will be used at Kudler Fine Foods will be Attestation,

SAS 94, and Financial Audit. IT auditors can use the Attestation and Financial Audits for

accounts payable, accounts receivable, and payroll as they confirm that numbers on the financial

statements are correct, internal procedures are compliant with COSO, and check sales contracts

with third parties. For the inventory and payroll departments the SAS 94 Audit can be used as it

helps auditors gain an understanding of how recurring and nonrecurring journal entries are

initiated, entered, and processed through the companies information system and the IT

components evaluated are: physical and environment review, system administration review,

AUDIT PROPOSAL 3

application software review, network security review, business continuity review, and data

integrity review (Bagranoff, 2008).

Recommend the audit most appropriate for each process.

Explain how the audits will be conducted.

Identify events that might prevent reliance on auditing through the computer.

ReferencesBagranoff, N. A. (2008). Core Concepts of Accounting Information Systems, Information

Technology Auditing. John Wiley & Sons, Inc.