Accounting Information Systems 8th Edition by James Hall

Exercise 3

AUDIT OF SYSTEMS DEVELOPMENT
The Balcar Company's external auditors are developing an audit plan to review the company's systems development procedures. Their audit objectives are to ensure that
1. the system was judged necessary and justified at various checkpoints throughout the SDLC.
2. systems development activities are applied consistently and in accordance with management's policies to all systems development projects.
3. the system as originally implemented was free from material errors and fraud.
4. system documentation is sufficiently accurate and complete to facilitate audit and maintenance activities.
The following six controllable activities have been identified as sources of audit evidence for meeting these objectives: systems authorization, user specification, technical design, internal audit participation, program testing, and user testing and acceptance.
Required
a. Explain the importance of each of the six activities in promoting effective control.
b. Outline the tests of controls that the auditor would perform in meeting audit objectives.