Kudler

Audit Proposal

Kudler Fine Foods (KFF) management reviewed the information on the accounting information system (AIS) and is interested in the proposed audit schedules. Audit schedules are the information formats that guide a corporation in the preparation of an audit. The following brief will distinguish between the types of audits that might be used for each process, recommend the audit that is most appropriate for each process, explain how the audits will be conducted, and identify any events that might prevent reliance on computerized audits.

To ensure Kudler Fine Foods’ information system is in compliance with statutory regulations, the difference between the internal and external audit processes must be examined. The external audit is required by the statutory regulations. The internal audit is performed to test internal controls and certify that policies and procedures are in compliance for the external audit. The internal auditor evaluates internal controls, policies and procedures, financial statements, job descriptions, and organizational charts. Upon completion the auditor defines any deficiencies and reports the errors allowing corrective actions to be taken. The auditor must address all deficiencies and confirm they are corrected to meet the statutory requirements.

The external auditor reviews all aspects of the company’s business including: financial statements, information systems, operations, and departments. The financial audit is an evaluation of the historical data that verifies proper recording and reliability. The operational audit evaluates organization objectives and establishes that all the policies and procedures are followed. The information system audit analyzes system applications, controls, and developments. The department reviews establish that the administrative duties are adequately defined and that proper resources are employed. If any potential problems are uncovered during the course of the audit, a thorough...