Kudler Fine Foods has many different types of audit to consider that could be used for each functional areas of AP, AR, inventory management and payroll. This brief has the purpose to distinguish among the types of audits that could be used for each process; to recommend the audit most appropriate for each process; to explain how the audits will be conducted; and to identify events that could prevent reliance on auditing through the computer.
Types of Audit
Due to increasing economic and financial growth, many types of audit have been incorporated throughout the development process of internal activities. Audits can be performed manually or they can incorporate technology. According to Hunton and Bagranoff (2004), there are four main types of audit: 1) Attestation; 2) Findings and Recommendations; 3) SAS 70; and 4) SAS 94. Each type brings something unique to the table and can be used in different situations.
Attestation. The Attestation audit present reports on examinations reviews or agreed-upon procedures. The auditor provides assurance on something for which the client is responsible. Findings and Recommendations. Findings and Recommendations is an audit that summarizes the audit work for each of the systems, which does not include an opinion. It could be considered “consulting” services.
SAS 70 Audit. The SAS 70 is an auditing standard created by the AICPA and has two report types – Type I, which the auditor reports an opinion about the operating controls and Type II, that meets the objectives of the Type I additionally includes a detailed test of the effectiveness of the controls.
SAS 94 Audit. SAS 94 audit deals with electronic records and have the purpose to guide and extend the auditor responsibilities in reference to internal controls knowledge as a part of a regular financial audit. Appropriate Audit Recommendations and Steps for each Process
Accounts Payable. The appropriate IT audit for...