Electronic Data Processing—Programming For the Internal Auditor
BY VIRGIL F. BLANK Partner, San Francisco Office
Presented before the San Francisco Chapter of The Institute of Internal Auditors — February 1958
OUR principal concern these past few years with respect to electronic
data-processing systems has been with the problems of shifting from the planning stage to the developing and using stage. Where we formerly struggled to learn all about electronic equipment and its capabilities, we are now attempting to utilize this knowledge in our particular accounting and management applications.
Tonight we shall assume that everyone here has a working knowledge of computer systems. Accordingly, we shall confine the theme of our remarks to the technical problems confronting the internal
auditor as a result of the development and application of electronic
data-processing systems in business.
When we speak of programming for the internal auditor, we are using the term programming in its broad sense. We are selecting the control phase of the electronic data-processing problem in order to concentrate our attention on those matters that should be of particular interest to—and the particular responsibility of—the internal auditor. We are going to focus attention on the auditors' contributions to the programming effort.
As we examine our subject more closely we find one factor which aids in pin-pointing the areas requiring study. This factor is the retention
of all of our traditional auditing methods and standards. Electronic
data processing challenges us only in the matter of modification of our customary auditing techniques. These techniques, therefore, must be shaped to fit the electronic system in such a way that there will be no question as to the validity of the tests or the degree of verification
In most of the present installations the electronic system embraces
a relatively small segment of the total work area for which the internal auditor is normally responsible. It is in this small segment of work that there must be a reshaping of techniques. In this part of his work the auditor will have to change his approach and alter his auditing procedures to meet the requirements of electronic accounting
In carrying out the internal audit responsibilities for the work within the electronic system, it is only necessary to clarify that which