A model for scheduling the monitoring of internal control in advanced EDP systems

Abstract

An aspect of internal control which troubles executives is the increasing dependence of companies on computers for financial reporting and operational effectiveness. Given the increasing number of computer applications, such as database systems, distributed networks, and on-line processing, there is a need for tools that assist in monitoring controls in advanced electronic data processing (EDP) systems. Thus far, those who have addressed this issue have concentrated on models for choosing between alternative systems of control. In this paper, we address what we view as a more pressing issue. That is, models for providing management with guidance as to the frequency of monitoring internal controls. With the increased capability for embedding audit modules in the processing system, the question of frequency of monitoring becomes a concern in the systems design itself.