SAS 48 and the basic framework for the auditing procedures

SAS 48 provides the basic framework for the auditing procedures necessary in examining the financial statements of entities that use computer accounting applications. A pronouncement describes the basic procedures and areas of concern with which the auditor should be familiar. A pronouncement specifically covers the following topics:

How the audit is affected by the following:

Extent of computer use in each significant accounting application
Complexity of the organization’s computer operations
Organizational structure of IT activities
Availability of data for audit use
Use of computer-assisted audit techniques (CAAT) to increase the e. ciency of audit procedures (AU Sec. 311.09)

Need for auditors with specialized expertise in IT (AU Sec. 311.10)
Influence of internal control procedures on the methods an organization uses to process significant data

Characteristics distinguishing computer processing from manual processing are
Abbreviated life of transaction trails
Greater uniformity of processing, which decreases processing errors but increases vulnerability to programming errors
Potential for concentration of incompatible functions
Increased chance for errors and irregularities due to ease of gaining unauthorized access to systems and files
Potential for increased management supervision
Automatic initiation of processing functions

Interdependence of manual and automated controls (AU Sec. 320.33)
Interdependence of control procedures (AU Sec. 320.57)
Adequacy of general and application controls. General controls relate to several computer-based activities such as control over system development. Application controls are application-specific controls (AU Sec. 320.58)
Need to obtain reasonable assurance for the reliability of the operation of programmed controls (AU Sec. 320.65-66)
Unchanging nature of audit objectives, although evidence collection methods may vary (AU Sec. 326.12)