I will be focusing on the elements of the system development process, the management controls I will be expecting to see throughout the process are:
-Authorisation required for development projects
-Changes must be controlled using appropriate approval and documentation
-Administrative controls must be built into the design of the new system (eg batch control supervisor), verification is normally done by checking a service or system meets a set of specifications. Verification procedures involve performing tests to model, then concluding a review of the modelling results. A verification usually repeat test to ensure the products continues to meet the specific requirements and complies with regulations that have been established during the beginning of the development process. Verification is an internal process and can be in development or production. Validation is intended to ensure that the product or system results in a system that meets the operational needs of the user. Validation is used to predict faults and gaps that might lead to invalid or incomplete verification of the product. This is mainly an external process. Security controls are to minimise or avoid security risks to any company or property; there are a number of ways to avoid this such as user login and access controls, firewalls and antivirus software.
-Documentation of developments must be complete, filed and kept up to date so that others can follow on
-User training to ensure they are able to make the most of the new system
-Scheduling of work and costs must be controlled to ensure a quality product is produced within budget and by the deadlines set
-Testing must be thorough and completed before approval for implementation
System life cycle
Cost and benefits –feasibility, being able to benefit from new and the old system in an inexpensive way. The purchase of new products such as buying new software and hardware, software is intangible part such as utilities and operating system and programs, on the other hand hardware are tangible parts such as keyboards, printer’s monitors and disk drive. Staff are also able to benefit from the new system due to a various number of cost cut which leads to saving.
User testing –user acceptance, on a clear plan of who and how the system is being tested as well as being able to identify errors in a development system
Training – the user should be trained on how to be able to use the new system and how to put in the new program
Conversion – Being able to convert the old system onto the new system
Management is to is to ensure the profitability and efficiency of the company .the reliability of information and whether adhering to rules and regulations is practiced.
Internal audit also inspects the process of the business and its financial reporting.
Question 2 –Evaluate the usefulness to auditors of the fraud triangle and red flag theories in assisting them to identify circumstances where there may be an increased...