How to Conduct an IT Audit: Essential Steps Every Accountant Should Know

An IT audit entails a thorough review of an organization’s IT infrastructure, policies, operations, and other relevant aspects to ensure everything is functioning optimally and aligning with business goals. In today’s technology-driven world, there’s a growing overlap between accounting and IT functions.

Accountants are no longer just focused on numbers; they also play a crucial role in protecting financial systems. IT audits are a key process for conducting a thorough evaluation of the IT system, which helps ensure data accuracy, security, and compliance.

This blog will discuss the IT audit processes and the essential steps involved, which every accountant should be well-versed in.

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What Is an IT Audit: Key Steps for Accountants to Understand

So, what is an IT audit? An IT audit is a process of reviewing and verifying a company’s technology systems, including its hardware, software, data handling, policies, and day-to-day technical operations, to ensure everything is functioning correctly and adhering to established guidelines.

It goes beyond the routine check-ups, delving deep into the intricacies of your IT infrastructure, policies, and operational strategies. By carefully reviewing these areas, an IT audit ensures that everything adheres to industry standards and supports your overall business objectives.

Overall, an IT audit is a check that not only identifies potential issues but also strengthens the core of your business technology, ensuring it remains robust to meet the dynamic of the present digital landscape.

Understanding IT Audits and Their Purpose

An IT audit assesses whether a company’s technology systems are secure, functioning properly, and aligned with its business objectives. It examines how effectively IT controls protect data, devices, and systems and ensures that employees follow security protocols.

Purpose of an IT Audit:

• To keep IT assets secure and up-to-date
• Spots security risks before they become problems
• Ensures compliance with privacy and security standards
• Identifies and fixes inefficiencies in IT processes
• Helps businesses stay prepared for changing security needs

Preparing for an IT Audit

An audit may take a few days to complete. However, the planning and preparation start in advance. The key decision is whether to conduct an internal audit (by your team) or hire an external auditor. An internal audit is cost-effective and suitable for most companies. However, external audits are ideal for larger companies or those handling sensitive data. Some companies conduct internal audits annually and bring in external auditors every few years for an additional layer of assurance.

Key steps to prepare for an IT Audit:

• Choose your auditor (internal or external).
• Set a date for the audit.
• Prepare your employees, as the auditor may need to speak with them. Schedule this when workloads are manageable.

Once the timeline is set, work with your team to organize the audit process by:

• Defining the goal and scope of the audit.
• Deciding how the audit will be recorded and reported.
• Create a detailed schedule showing which departments will be reviewed and when.

Conducting Risk Assessments

Risk assessment in IT audit is the process of finding and understanding possible risks and vulnerabilities to a company’s technology systems. It helps auditors identify the most significant threats, enabling them to focus on the most critical areas and utilize resources effectively. By spotting weak points early, companies can improve their security and better protect sensitive data.

Also Read: Master’s Degrees that Combine Tax Law and Accounting

Reviewing IT Controls and Compliance

Reviewing IT controls and compliance involves verifying that a company’s technology systems and processes comply with relevant rules, industry standards, and internal policies. It helps keep data safe, protects privacy, and ensures everything runs smoothly by finding weak spots that need fixing.

Reporting and Implementing Audit Findings

Audit findings are issues or observations made by auditors during their review of a company’s financial records, operations, or compliance processes. These findings are typically categorized into three types:

• Material weaknesses, which represent serious flaws in internal controls that could lead to significant errors
• Significant deficiencies, which are less severe but still require management’s attention
• Other observations are general suggestions for improving systems or IT audit processes.

Understanding what each finding means and its impact is the first step toward resolving them effectively.

Also Read: How to Land a Tax Compliance Role at a Big 4 Accounting Firm

Tools and Skills Accountants Need for IT Audits

Accountants conducting or supporting IT audits require technical proficiency, soft skills, and audit expertise. They should possess the ability to analyze data, understand IT systems, and handle financial reports, as well as exhibit good communication, critical thinking, and problem-solving skills.

Below are some  must-have tools and skills that can strengthen the ability of accountants to lead or contribute to IT audits effectively:

Category	Tools/Skills
Technical Skills	Data analysis tools, such as Excel, Power BI, SQL Understanding of IT systems and networks Cybersecurity knowledge and data protection practices Familiarity with audit software Know-how of financial reporting and accounting standards
Soft Skills	Critical thinking and analytical skills Problem-solving ability Communication and teamwork Attention to detail
Other Skills	Knowledge of compliance standards Skills in risk assessment and control evaluation Basic knowledge of project management

Also Read: Top Careers You Can Pursue with an MSA in Tax Compliance and Strategy

Accounting and Technology Programs at Edgewood University That Prepare You for IT Audits

Explore Accountancy programs at Edgewood University, like the Master of Science in Accountancy in Information Systems and Controls or an MBA in Accounting, that prepare you for a successful career in IT auditing and other areas of accountancy. These online programs combine core accounting principles with practical training conducted through an online mode. They are designed for working professionals looking to gain the technical and analytical skills in accountancy to navigate today’s tech-driven business environment.

You can also consider these courses from Edgewood University

• MS in Accountancy in Business Analysis and Reporting Online
• MS in Accountancy in Information Systems and Controls
• MS in Accountancy in Tax Compliance & Strategy

FAQs on How to Conduct an IT Audit

Q: What is an IT audit, and why is it important for accountants?
Ans: An IT audit is a process of reviewing and verifying a company’s technology systems to ensure everything is functioning correctly and adhering to established guidelines. They are essential for accountants because they provide the accuracy of financial information as more businesses use technology for their transactions and reporting.

Q: Why are IT audits necessary for financial professionals?
Ans: IT audits are essential for financial professionals because they ensure that the technology systems used for financial reporting, data storage, and transactions are secure, accurate, and reliable.

Q: What are the basic steps in conducting an IT audit?
Ans: Here are the basic steps in conducting an IT audit:

• Plan the audit
• Prepare for the audit
• Conduct the audit
• Report your findings
• Follow up

Q: Do accountants need technical knowledge to do an IT audit?
Ans: Accountants possess a robust understanding of finance and business operations, which provides a solid foundation for transitioning into IT auditing. However, it is essential to recognize that IT auditing encompasses more than just financial systems. They also examine how technology is utilized and protected throughout the entire organization.

Q: Are there certifications for IT auditing?
Ans: Yes, there are several online accounting certifications for IT auditing, including the Certified Information Systems Auditor (CISA), Certified Internal Auditor (CIA), Certified Information Systems Security Professional (CISSP), and Certification in Risk and Information Systems Control (CRISC).