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    IT-Audit Team2

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    Von Andrei Medina
    Kawit College is undergoing budget reductions and must lay off one of its five IT staff members. The document provides advice to the college on how to divide the five IT functions - computer operator, systems analyst, librarian, programmer, and data controller - among the remaining staff while maintaining the best possible internal controls. It considers dividing the functions among four, three, and two people and ultimately determines that while internal controls would be significantly weakened with one person performing all functions, an audit could still be conducted using other evidence-gathering procedures.

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    IT-Audit Team2

    Uploaded by

    Von Andrei Medina
    190 views1 page
    Kawit College is undergoing budget reductions and must lay off one of its five IT staff members. The document provides advice to the college on how to divide the five IT functions - computer operator, systems analyst, librarian, programmer, and data controller - among the remaining staff while maintaining the best possible internal controls. It considers dividing the functions among four, three, and two people and ultimately determines that while internal controls would be significantly weakened with one person performing all functions, an audit could still be conducted using other evidence-gathering procedures.

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    IT-Audit_Team2

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    Kawit College is undergoing budget reductions and must lay off one of its five IT staff members. The document provides advice to the college on how to divide the five IT functions - computer operator, systems analyst, librarian, programmer, and data controller - among the remaining staff while maintaining the best possible internal controls. It considers dividing the functions among four, three, and two people and ultimately determines that while internal controls would be significantly weakened with one person performing all functions, an audit could still be conducted using other evidence-gathering procedures.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    190 views1 page

    IT-Audit Team2

    Uploaded by

    Von Andrei Medina
    Kawit College is undergoing budget reductions and must lay off one of its five IT staff members. The document provides advice to the college on how to divide the five IT functions - computer operator, systems analyst, librarian, programmer, and data controller - among the remaining staff while maintaining the best possible internal controls. It considers dividing the functions among four, three, and two people and ultimately determines that while internal controls would be significantly weakened with one person performing all functions, an audit could still be conducted using other evidence-gathering procedures.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    Case:

    You are doing the audit of Kawit College, a private school with approximately 2,500 students. With your firm’s
    consultation, they have instituted an IT system that separates the responsibilities of the computer operator, systems
    analyst, librarian, programmer and data control group by having a different person to do each function. Now, a budget
    reduction is necessary and one of the 5 people must be laid off. You are requested to give the college advice as to how the
    five functions could be done with reduced personnel and minimal negative effects on internal control. The amount of time
    the functions take is not relevant because all 5 people also do non accounting functions.

    Required:
    1. Divide the 5 functions among 4 people in such a way as to maintain the best possible control system.
    Person 1: System Analyst and Programmer
    Person 2: Data Controller
    Person 3: Computer Operator
    Person 4: Librarian 
    2. Assume the economic times become worse for Kawit College and it must terminate employment of another
    person. Divide the 5 functions among 3 people in such a way as to maintain the best possible internal control. 
    Again, the amount of time each function takes should not be a consideration in your decision.
    Person 1: Computer Operator
    Person 2: System Analyst and Programmer
    Person 3:  Librarian and Data Controller
    3. Assume the economic times become so severe for Kawit College that only 2 people can be employed to do IT
    functions. Divide the 5 functions between 2 people in such a way as to maintain the best possible control
    system.
    Person 1: Computer Operator and Librarian
    Person 2: Systems Analyst, Programmer, and Data Controller
    4. If the 5 functions were done by one person, will internal controls be so inadequate that an audit cannot be
    done?
    Internal control would be affected greatly in a negative manner if all five functions were performed by
    one person. This is because each function requires expertise, and it is of little possibility that all functions can be
    done by one person correctly and objectively. There will also be lack of independence, since if one person would
    perform all functions, he would know the flow of information whereas he may commit fraud by omitting and
    adding to the data. With internal control being affected, the test of controls in auditing is also affected. Test of
    controls is only one of the procedures in audit. This means that an audit could still be done on Kawit College. To
    support this argument, here are three points we’d consider. First, only tests of controls is affected by this IT
    control function scenario. Auditors may still rely on other perspectives of Internal control, and he may also use
    Substantive testing to gather the audit evidence needed to support the statements, transactions and such. Second,
    the roles are all non-accounting, this means that an accounting personnel of Kawit College, as part of his/her
    duties, should see to it that all records are reliable and are according to particular rules, regulations and standards
    before letting it reflect to their legal, regulatory and operation papers. Lastly, the college may have also placed
    controls outside the IT function. Thus, other perspectives of internal control could still be subject for audit, of
    which is reliable and stronger than the IT function.

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