An organization has decided to migrate payroll processing to a new platform hosted by a third party in a different country.
Which of the following is MOST important for the IS auditor to consider?
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A. B. C. D.C.
When an organization decides to migrate its payroll processing to a new platform hosted by a third party in a different country, the IS auditor needs to consider various factors to ensure that the organization's data is secure, and the outsourcing arrangement complies with relevant laws and regulations. Among the four options provided, the MOST important factor for the IS auditor to consider is the service provider's compliance with privacy regulations (option A).
Explanation:
A. The service provider's compliance with privacy regulations: The IS auditor must ensure that the service provider has appropriate data protection and privacy controls in place to safeguard the organization's sensitive payroll data. The auditor should verify that the service provider has implemented necessary technical and organizational measures to ensure the confidentiality, integrity, and availability of the data, and that these measures comply with the applicable privacy regulations in both the organization's country and the country where the service provider is located.
B. Whether the contract contains a right-to-terminate clause: This is an important clause that allows the organization to terminate the outsourcing arrangement in case of breach of contract or other issues. However, this factor is not the MOST important for the IS auditor to consider.
C. The service provider's compliance with financial regulations: While compliance with financial regulations is important, it is not as critical as compliance with privacy regulations when it comes to protecting sensitive payroll data. However, the IS auditor should verify that the service provider is financially stable and has appropriate financial controls in place.
D. Storage costs charged by the service provider: Although storage costs are a relevant factor for the organization, they are not the MOST important for the IS auditor to consider. The IS auditor's primary focus should be on ensuring the security and confidentiality of the organization's data, rather than on cost-related issues.
In summary, when an organization decides to migrate payroll processing to a new platform hosted by a third party in a different country, the IS auditor should prioritize the service provider's compliance with privacy regulations to ensure the security and confidentiality of sensitive payroll data.