Johnson, CPA, was engaged to audit the financial statements of Horizon Incorporated, which has its own computer
Question:
Johnson, CPA, was engaged to audit the financial statements of Horizon Incorporated, which has its own computer installation. While obtaining an understanding of internal control, Johnson found that Horizon lacked proper segregation of the programming and operating functions. As a result, Johnson intensified the consideration of internal control surrounding the computer and concluded that the existing compensating general control activities provided reasonable assurance that the objectives of internal control were being met.
Required:
a. In a properly functioning computer environment, how is the separation of the programming and operating functions achieved?
b. What are the compensating general control activities that Johnson most likely found?
Step by Step Answer:
Auditing Concepts And Methods A Guide To Current Auditing Theory And Practice
ISBN: 9780070099999
5th Edition
Authors: Mcgraw-Hill