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Information System Auditing and Financial Auditing - Essay Example
Due to the advancement of technology, accounting of various businesses was also automated; along with this is the need to change the auditing techniques. The main objective of this paper is to distinguish the relationship between information system auditing and financial auditing.
As stated, information system audit is just one of the important components of a financial audit. It is vital in the sense that data's found in the system or the system per se may be used in fraudulent or unintentional mistake that would have an enormous impact of the financial position of a company. On May 5, 2009, Westpac Bank of New Zealand erroneously deposited NZ$10M to a couple who were hoping that their request for a NZ$10,900 overdraft will be accepted. After the couple discovered their "newfound wealth" they had it transferred to an offshore account and then disappeared. It is for this purpose that IT auditing exists. Internal control was probably not in placed to detect the oversight that happened in this scenario which led to a NZ$10M loss.