List out the circumstances, where auditing is done through the computer.

Auditing and Assurance Revision Questions and Answers

The auditor can use the computer to test the logic and controls prevalent within the system and the records generated by the system. Depending upon the complexity of the application system being audited, the approach may be different. It may be fairly simple or may require extensive technical competence on the part of the auditor. Circumstances that may cause to conduct audit through the computer are as follows:

a) The application system processes large volume of input and produces large volumes of output that make extensive direct examination of the validity of input and output difficult.

b) Significant parts of the internal control system are embodied in the computer system.

c) The logic of the system is complex and there are large portions that facilitate use of the system or efficient processing.

d) Because of cost-benefit considerations, there are substantial gaps in the visible audit trail.

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