Continuous auditing : theory and application / edited by David Y. Chan, Victoria Chiu, and Miklos A. Vasarhelyi.

Format:

Book

Contributor:

Chan, David, 1960- editor.

Chiu, Victoria, editor.

Vasarhelyi, Miklos A., editor.

Series:

Rutgers studies in acounting analytics

Language:

English

Subjects (All):

Auditing.

Physical Description:

1 online resource (viii, 350 pages) : illustrations.

Edition:

1st ed.

Place of Publication:

Bingley, England : Emerald Publishing, 2018.

Summary:

Continuous auditing is a novel emerging technology in academia and practice. The concept of continuous auditing was conceived over two decades ago in academia and we are now at a junction where the auditing profession recognizes the implement-ability and value of a continuous audit. The book's purpose is twofold. First, the book aims to provide academics and practitioners with a compilation of select continuous auditing design science research that can be used as a springboard to future research and development. Second, the book aims to provide readers with an understand of the underlying theoretical concepts of a continuous audit, ideas on how continuous audit can be applied in practice, and what has and has not worked in research.

Contents:

Front Cover

Continuous Auditing: Theory and Application

Copyright Page

Contents

List of Contributors

Introduction

References

Continuous Auditing-A New View

1. INTRODUCTION-CONTINUOUS ASSURANCE THE THEORY

1.1. Continuous Process Auditing

Control Structure

Control Compliance

Data

1.2. Conceptualizing Various Elements of CA

Continuous Data Audit CDA

Continuous Control Monitoring (CCM)

Continuous Risk Monitoring and Assessment (CRMA)

Continuous Compliance Monitoring

1.3. Guidance on Continuous Auditing

2. THE ELEMENTS OF CONTINUOUS ASSURANCE REVISITED

2.1. Continuous Auditing Versus Continuous Monitoring

2.2. The Elements of Continuous Audit

3. INFORMATION TECHNOLOGY AND THE AUDITOR

3.1. Evolving Database Audit Conceptualization

3.2. Incremental Technological Change

3.3. The Audit Data Standard

4. THE NEW CONTINUOUS AUDIT

4.1. Assurance Level

4.2. Time Focus

4.3. Time Interval

4.4. Data Source

4.5. Chosen Procedure

4.6. Choice of Assertion

4.7. Analytic Method

4.8. Assurance Entity

5. QUESTIONS REGARDING SOME AUDITING CONCEPTS IN THE MODERN ENVIRONMENT

5.1. Stochastic Opinion Rendering in a World of Statistics

5.2. New Audit Products

5.3. Management, Control, Assurance, and Other Meta-Processes Confusion of Concepts

5.4. Independence

5.5. Migration of Functions to Automation

5.6. The Audit Ecosystem

6. CONCLUSIONS

6.1. The New CA

The Development and Intellectual Structure of Continuous Auditing Research

1. Introduction

2. Overview of continuous auditing research

2.1. The emergence of continuous auditing: electronic data processing and audit automation

2.2. Demanding and promoting real-time reporting and assurance

2.3. Continuous controls monitoring.

2.4. Implementation of continuous auditing and continuous controls monitoring

3. Characteristics of continuous auditing research

3.1. Methodology: article source and collection

3.2. Taxonomic categories development

3.3. Findings: characteristics of continuous auditing literature

3.3.1. Research method

3.3.2. Topical area

3.3.3. Specific area of emphasis

3.3.4. Geographical area

3.3.5. Longitudinal analysis of research methods by specific area of emphasis

3.3.6. Longitudinal analysis of topical area by specific area of emphasis

4. Paths for future research

4.1. A view of the future

4.2. Potential research areas for the next cycles

4.2.1. Internal controls

4.2.1.1. Proposed researchable questions - on internal controls.

4.2.2. Automating and extending accounting

4.2.2.1. Proposed researchable questions - on automating and extending the model.

4.2.3. New evidence in auditing

4.2.3.1. Proposed researchable questions - on continuous audit evidence.

4.2.4. Analytic methods in auditing

4.2.4.1. Proposed researchable questions - on analytic methods in auditing.

4.2.5. Adapting CA technology to new technology

4.2.5.1. Proposed researchable questions - on adapting CA technology to new technology.

4.2.6. Formalizing standards

4.2.6.1. Proposed researchable questions - on formalization of standards.

4.2.7. Other

4.2.7.1. Proposed researchable questions - on auditors' behaviors, careers &amp

qualifications in ca environment.

5. Conclusion and implications

The Continuous Audit of Online Systems

Technology and the Auditor

Current Environment for Large Applications

Continuous Process Auditing

Key Concepts

Software Implementation

Discussion

References.

Continuous Auditing of Database Applications: An Embedded Audit Module Approach

Need for EAMS in DBMS Environments

Prior Research

Database Control and Security, and EAMS

Database Control and Security

Control Approaches in DBMS Environments

Establishing Controls Using DBMS Facilities

Audit Modules Embedded Into DBMS Application Programs

Auditing Database Applications Using EAMS

Error Handling Approaches

Implementation of EAMS

Control Violations

Access Violations

Auditor Interface

Use of EAMS as an Audit Tool

Advantages and Drawbacks of EAMS

Operational Considerations

Advantages of Using EAMS

Drawbacks

Conclusion

Continuous Online Auditing: A Program of Research

I. Introduction

What is Continuous Online Auditing?

Feasibility of Continuous Online Auditing

Technological Feasibility

Economic Feasibility

II. History and Institutional Background

Continuous Audit of Database Applications

The Elliott Committee

The Systems Reliability Task Force

CICA/AICPA Committee on Continuous Auditing

Some Experiences in Continuous Online Auditing

CPAS

Fund Radar

Ernst &amp

Young

Bank Case

III. A Program of Research in COA

Architectural Issues Relating to Continuous Online Auditing

General Architecture

Audit Risk Assessment

Data Capture

Scope of Auditing

Systems Audit

Real-Time Analytical Review Procedures

Security of COA

Electronic Records

Distance Auditing

Factors Affecting the Use of COA

Functional Areas

Industrial Sectors

Internal vs. External Use

Characteristics of an External Auditor

Effects or Consequences of COA

Effects on Direct Costs and Agency Costs

Effects on Audit Quality

Managerial and Psychological Effects

Effects on Audit Practice.

IV. COA Research Priorities and Concluding Remarks

Feasibility and Economics of Continuous Assurance

Analysis of Continuous Assurance in an ASP Setting

Essential Components of Assurance

Components of Assurance

Continuous Recording of Business Transactions

Transaction Monitoring, Assurance, and Reporting

Demand for Continuous Assurance

Inherent Demand for Assurance

Is Demand for Assurance Guaranteed?

Demand for Real-Time Assurance

Paying for Continuous Assurance

Need for a Payment Infrastructure for Assurance

Costs of Providing Assurance

Ownership of Assurance Products

Assuror's Independence and the Technical Architecture of Continuous Assurance

Issues for Further Research

Continuous Auditing: Building Automated Auditing Capability

Real-Time Accounting and Electronic Financial Reporting

Continuous Auditing Definition

Continuous Auditing Process

Continuous Auditing Methodology

Building Continuous Auditing Capability

Continuous Auditing Applications

Summary and Conclusion

Future Research

Principles of Analytic Monitoring for Continuous Assurance

Supply and Demand for Continuous Assurance

Objectives of Continuous Assurance and Analytic Monitoring

Levels of Assurance and Audit Objectives

Level 1: Transaction Evaluation

Level 2: Measurement Rule Assurance (Compliance)

Level 3: Estimate Assurance and Consistency of Aggregate Measures

Level 4: Judgment Assurance

An Example of the Four Levels in the Pension Area

Timing of Continuous Assurance

The New Process of Continuous Assurance

The Process of Analytic Monitoring

Hierarchy of Auditing: Primary, Secondary and Tertiary monitoring

An Architecture of Continuous Assurance: the MC layer.

Steps in the Process

Tertiary 'Black Box' Monitoring

Tools for Analytic Monitoring in Continuous Assurance

Continuity Equations

Tagging Data Accuracy

Time Series Analysis

Dynamic Reconciliation of Accounts

Data Taps in CA

Automatic Confirmations

Control Tags

Outcomes of the Continuous Assurance Process

An Expanded Set of Assurances

Improvement on Control Processes

Improved Data Integrity

Conclusions

Continuous Monitoring of Business Process Controls: A Pilot Implementation of a Continuous Auditing System at Siemens

2. The Pilot Implementation

3. Continuous Monitoring of Business Process Controls

3.1. Modes of CMBPC

3.2. System Architecture for Continuous Monitoring of BP Controls

3.3. Interaction of MC Layer with the ERP System

4. Implementing CMBPC at Siemens

4.1. Selection of AASs

4.2. Data Issues

4.3. CA Analyzer

5. Formalizing and Reengineering the Process of Auditing to Implement CMBPC

6. Control and Alarm Hierarchy and Its Management in CMBPC

7. Audit Trail of CMBPC

8. Developers of Continuous Monitoring Software

9. Concluding Remarks

Putting Continuous Auditing Theory into Practice: Lessons from Two Pilot Implementations

II. The Development of Continuous Auditing

III. What is Continuous Auditing and Who Should Use it?

IV. Lessons from Pilot Projects

V. The Siemens Project: Continuous Control Monitoring

VI. The HSP Project: Continuous Data Assurance

VII. Discussion

Innovation and Practice of Continuous Auditing

2. Continuous Auditing Innovations in Audit Methodology

2.1. Continuous or Frequent Audit

2.2. Proactive Audit

2.3. Automation of Audit Procedures

2.4. Work and Role of Internal and External Auditor.

2.5. Nature, Timing, and Extent of Testing.

Notes:

Includes index.

Print version record

ISBN:

9781787434653

1787434656

9781787434134

1787434133