Technology in audit engagements: a case study

Abstract

Purpose

The audit of corporations is now dependent on the examination of corporate computer systems. Although tools and techniques have been available for decades, there are major limitations on the audits of corporate systems by external auditors. This paper aims to examine external auditor usage of technology benefiting from a unique opportunity of reviewing a large CPA firm's audit work papers and interviewing their audit staff to examine the following questions: are auditors using the available technological tools? What are the difficulties they face in using these tools? Are there mediators to enhance usability? Why and what circumstances surround their absence?

Design/methodology/approach

The authors use a cross-sectional, case-based field study comparing four engagements in a major audit firm.

Findings

This paper concludes that the characteristics of the audit team largely determine the levels of technology utilization. Furthermore, the integration of technology support teams and auditors may improve usability, and, consequently, increase technology adoption.

Research limitations/implications

The paper includes information about four audit engagements. Given that audit firms have different cultures, practices and employee competencies, and hence emphasize the use of technology to varying degrees, it would be desirable to expand this study to reflect these variations.

Practical implications

The paper presents a discussion of the reasons why auditors do not fully use technology and provide tools to increase its usability.

Originality/value

The paper benefits from a unique opportunity of interviewing audit teams of a large firm, as well as through reviewing their work papers.

Citation

A. Vasarhelyi, M. and Romero, S. (2014), "Technology in audit engagements: a case study", Managerial Auditing Journal, Vol. 29 No. 4, pp. 350-365. https://doi.org/10.1108/MAJ-06-2013-0881