SA 402

Question 1

How to identify services that are part of user’s IS & FR

If it affects the following :

Answer 1

1.SCoT
2.NSCoT- user’s IS captures them
3.Entity’s transactions-initiated,recorded,processed,corrected,transferred,reported
4.A/c records - to initiate,record,process,report transactions
5.FR process
6.Controls sorrounding JE - non recurring,unusual trans. & adj.

JE - journal entry
IS - Information system

Question 2

Obtain understanding of svc of svc orgn

Answer 2

1. Nature & significance - service provided inc. to the entity’s internal control system
2. Nature & materiality of transactions, a/cs & FR processed - affected by svc
3. Degree of interaction ( extent - able to and elect to implement effective controls on svcs performed)
4. Nature of relationship - contractual terms