THE ROLE OF AUDITORS IN COMPUTERIZED ACCOUNTING SYSTEMS

(Accounting)

THE ROLE OF AUDITORS IN COMPUTERIZED ACCOUNTING SYSTEMS

TABLES OF CONTENT

CHAPTER ONE:

1.1     INTRODUCTION

1.2     STATEMENT OF PROBLEM

1.3     STATEMENT OF HYPOTHESIS

1.4     SIGNIFICANCE OF THE PROBLEM

1.5     LIMITATION OF THE STUDY

CHAPTER TWO

2.0         REVIEW OF LITERATURE

2.1         HISTORICAL REVIEW

2.2         NEEDS FOR COMPUTER IN AUDIT TODAY

2.3         ROLE OF AUDITOR IN EDP SYSTEM

2.4         EXAMINATION/ASCERTAINMENT OF INTERNAL CONTROL IN EDP

2.5         INTERNAL CONTROL INCOMPUTERIZED ACCOUNTING SYSTEM

CHAPTER THREE

3.1         RESEARCH METHODOLOGY

3.2         POPULATION AND SAMPLE SIZE

3.3         DATA COLLECTION

3.4         CONCLUSION

3.5         RECOMMENDATION

BIBLIOGRAPHY

CHAPTER ONE

1.1         INTRODUCTION

Computer is an electric device, which accept and process data by following a set of instruction (programmers) to produce an accurate and efficient result (information).  It is very systematic and computer and operates within a system theory.  It has input, control processing units, output and the backing storage.

A computer may be analog; digit and hybrid computers.  It can also be mainframe, mini and micro computer.

          Computer has passed many generation.  We are now in the fifth generation of computer known as the micro age.  Computer of this generation uses artificial intelligent.  It is important that the auditor, auditing in computer environment, like companies to be aware of the nature of computer accounting system uses in such companies.  A computerized accounting system is a system which the electronic data processing (EDP) is used in recording, processing, retrieving and up dating the accounting records.  The use of EDP in accounting system keeps a very wide rang accounting information, such a pay role, purchases and creditor ledger, sales and debtors ledger, cash book inventories, fixed assets as well as financial analysis of profit projection or forecasting cash flow and statement budgeting, capital investment and many others.

The use of computer in the accounting system ensure more efficient and reliability in processing of information since computer hardly make mistake. Unless mistake resulting from faulty data input.

In auditing organization with computerized system, the auditor responsibilities and duties do not change rather it is the means and form of processing financial that changes.

The auditor still owns the duty of skill and care in carrying out his assignment or engagement.  It becomes indispensable that the auditor should acquaint himself with the particular management information system, especially the computer installation concerned.

          It is also advisable that the auditor should acquire the organization chart and data flow chart of the computer installation at an early stage of the audit.  This will help him to have the overall picture of the system in operated.  He should concentrate on the system of internal control and internal check, and also, ensure adequate and efficient operation of the internal control system.  The use of computer does not in any way change the duty of an auditor.  What has change is the form and method of keeping accounting records in the company.

          He is still expected to express an opinion as to the true and fair view of the states of affairs of the company irrespective o change in form of keeping financial records.  It is important therefore, that the auditor should improve his methods, techniques and procedure in order to achieve his audit objective.

1.2         OBJECTIVE OF PROBLEM

The auditor face a lot of problem in the cause of carrying

out his duty in a computerized accounting system of an organization, such problem are as follows:

a.            The programmes or information are strictly written in the computer systematic order that one reading it must follow the system approach (which require strict adherent from the non-computer literate auditor to operate).

b.            The problem of power fluctuation, unavailability of trained and experienced man power for computing services, irregular supply of spare parts and inherent presence of dust and inducting in Nigeria atmosphere.

c.            The computer having his own language, one needs to write the interrogatory tool (computer software) in the programme language under which the data were created.

d.           As a result of the problem, the auditor has difficulties in auditing the system because it will limit speed and ability.

1.3         STATEMENT OF HYPOTHESIS

In every research work, the researcher wishes to arrive at a

particular result.  These result are stated in testable from and predict a particular relationship between two viable Ho.  There is no significant effect on the introduction of computer in accounting system of companies in financial sector on the auditor’s functions.  Hi.  There is a significant effect on the companies in financial sector on the auditors functions.

H2: The auditor encounter any difficulties when auditing and a computerized accounting system of companies in the financial sector.

1.4         SIGNIFICANCE OF THE PROBLEM

The objectives of any organization with computerized

accounting system is to audit through the computer accountings system in the financial sector, and timing of the audit work in a computer accounting system by the auditor.

          Auditing in an EDP system is very peculiar activity which require a stream of logic from the practitioners deep dedication form the auditor and provision of specialized atmospheric condition for clear service, but because of the presence of dust and moisture in the atmosphere of most financial sector with EDP system power failure and other logic reasons the auditor in the cause of his audit finds out that some for the information stored in the backing storage cannot be retrieved because of dust, this in effect has effect on the auditors opinion.

          The auditors finds it difficult at times to audit in a computerized system in some financial sector because not all the origin documents are presented to the auditor during the cause of his audit, so as to apply sound accounting systems and internal checks and control in his work.

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