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Cost-Effective IT: Auditing

Cost-Effective IT: Auditing, by Richard Sonnier

Houston Business Show "Advisor" Richard Sonnier, of the Information Technology Services firm Nimble Services, Inc., provides weekly information on our show about business technology issues. He can be reached at 281-445-4800 x250 or rsonnier@nimbleservices.com.

This week I will discuss Sarbanes-Oxley and IT auditing.

Sarbanes-Oxley

Here in Houston, we are all too aware of the Enron collapse resulting from an accounting scandal. Enron's auditor was Arthur Anderson at the time one of the largest accounting firms in the world and they are out of business as a result. Sarbanes-Oxley is legislation passed by Congress in the wake of Enron and other corporate scandals. The legislation mandates higher controls and certification of the financial reports of public traded companies. You should be aware that it is setting new standards for IT security. Since it is a public standard, many feel that even private or not-for-profit companies will have to comply with its requirements or face litigation for negligence.

IT Auditing

As noted in previous articles, IT is integral to most company operations espcially accounting and financial reporting. Therefore, Sarbanes-Oxley is causing all companies to evaluate the controls and security of their IT systems. Ultimately, this takes the form of an IT audit where the auditors will look much deeper into the IT systems than in the past. The key areas being examined are:
  1. IT Control Environment
  2. Computer Operations
  3. Access to Programs and Data
  4. Program Development and Program Change
From this top level, the auditors want to see a framework of companies policies and the specific controls that implement those policies. It can be time consuming and expensive to meet all the requirements.

Next week, I will discuss IT security.

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