Accounting Essay Sample

SAS-109 Analysis

1). The external auditing professionals must understand to safeguard the controls so that dependability of the financial reporting can be increased. They should use the access controls. They should understand the procedures of obtaining the audit evidence regarding the implementation and design of the related control via the information system. Further, they should conduct the procedures of the risk assessment so that they become capable of understanding the internal control. The auditor must understand the collective impact on the control environment of the advantages and disadvantages in several elements of the control environment. The auditor must obtain the required knowledge regarding control environment for understanding the actions, awareness, and attitudes of the internal control of the clients' accounting information systems as well as the importance of the attaining consistent financial reporting. The external auditors should increase their efforts related to the information technology in order to reduce the chances of failures associated with the information technology (Moorthy, Seetharaman, Mohammad, Gopalan, and San).
2). The external auditing professional must use the firm’s accounting information system by obtaining necessary knowledge related to the business processes pertinent to the financial reporting so that they can understand the transaction classes in the operations of the entity, the manual and automated systems, particular accounts in the financial statements, supporting information, authorization, reporting, and processing of the transaction. The auditors must use the accounting information system of the firm in order to understand the erroneous processing of the transaction and resolution of the incorrect transaction (Elliot and Elliot). Further, the external auditing professionals should consider the financial reporting process of the accounting information system of the firm that is used preparation of the financial statements and disclosures in order to ensure correct reporting.
(The Paragraphs containing information on the information systems and information technology are 56, 57, 58, 59, 60, 61, 64, 88, 94, 95, and 100)

References

Elliot, Jamie, and Barry Elliot. Financial Accounting and Reporting. New York: Pearson Education, 2007.
M. Krishna, Moorthy, Seetharaman A, Mohamed Zulkifflee, Gopalan Meyyappan, and San Lee Har. "The Impact of Information Technology on Internal Auditing." African Journal of Business Management 5.9 (2011): 3523-539.