Digital Auditing
19 Pages Posted: 5 May 2012
Date Written: May 4, 2012
Abstract
This paper summarizes the Statement on Auditing Standards (SAS) No. 106 – Audit Evidence. It extends the importance on why the financial statements should be fairly stated and in conformity, in all material respects, with Generally Accepted Accounting Principles (GAAP). Also, extends why audit procedures should be in accordance with Generally Accepted Auditing Standards (GAAS). With today’s advanced technology, computer assisted audit techniques (CAATs) have been a great aid for auditors. However, auditors need to take a new auditing approach to gathering digital evidence. The auditing approach should address classifying the sensitivity or criticality of digital information. This is especially important if the entity is subject to the Gramm-Leach-Bliley Act (GLB) or Sarbanes-Oxley Act of 2002. Most legal actions against auditors result from a lack of competent evidence like in the incident of PricewaterhouseCoopers International Limited (PwC). It is a challenge to determine if the digital evidence gathered by the auditor is sufficient and competent. This paper suggests some techniques in gathering and evaluating digital evidence.
Keywords: audit evidence, due diligence defense, management assertions
JEL Classification: M00, M40, M41, M49, K22
Suggested Citation: Suggested Citation