During an audit of an organization's financial statements, an IS auditor finds that the IT general controls are deficient.
What should the IS auditor recommend?
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A. B. C. D.C.
When an IS auditor finds that the IT general controls are deficient during an audit of an organization's financial statements, it indicates a significant weakness in the overall control environment. This means that the organization may have limited ability to identify and respond to risks associated with IT systems that could impact financial reporting.
Given this, the IS auditor should recommend a course of action that will help improve the overall control environment. The correct answer to this question is D. Place greater reliance on the framework of control.
Explanation of each answer choice:
A. Increase the compliance testing of the application controls: This answer choice is not appropriate since it focuses only on the application controls and does not address the underlying deficiencies in the IT general controls.
B. Place greater reliance on the application controls: This answer choice is also not appropriate since it suggests relying on controls that may be ineffective or unreliable due to the underlying deficiencies in the IT general controls.
C. Increase the substantive testing of the financial balances: This answer choice may be appropriate in some situations, but it is not a comprehensive solution to address deficiencies in IT general controls. Substantive testing can provide evidence about the accuracy of financial balances but does not address the root cause of the issue.
D. Place greater reliance on the framework of control: This answer choice is the correct option. It suggests addressing the underlying issues with IT general controls, which are designed to provide a foundation for reliable application controls and financial reporting. By placing greater reliance on the framework of control, the IS auditor can help ensure that the organization has a robust control environment and can identify and respond to risks associated with IT systems.
In summary, when an IS auditor identifies deficiencies in IT general controls during an audit of an organization's financial statements, the recommended course of action is to address the underlying issues with the control environment. This can be achieved by placing greater reliance on the framework of control.