- 15 Marks
AAA – Nov 2017 – L3 – Q7 – Audit of IT Systems and Data Analytics
Assess key controls for an online trading business, evaluate associated risks with electronic data interchange, and suggest effective risk mitigation controls.
Question
Young Entrepreneur Trading (YET) is an online trading business established by Yemisi Tumfere. YET sources household goods from various local and international manufacturers, placing orders online with suppliers. Customers also place online orders, and invoices are processed and sent to stores for dispatch through a network of delivery centers across the country.
YET, dissatisfied with its previous auditors, has approached your firm for the audit engagement, with professional clearance obtained. As the audit manager, you are responsible for the engagement, with several new trainees under your supervision who are unfamiliar with controls for online businesses.
Requirements:
a. Discuss FIVE controls an auditor should focus on to assess the effectiveness of controls in an online system like YET. (5 Marks)
b. Evaluate FOUR risks associated with YET’s use of electronic data interchange in an online business and recommend FOUR effective controls to minimize these risks. (10 Marks)
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