Question

How have electronic data interchange (EDI) systems effected audits?

• A. Since orders and billing transaction are done over the computer, source documents can not be obtained.
• B. Auditors often need to plan ahead to capture information about selected transaction over the EDI.
• C. There is no audit trail in an EDI system,so controls are typically assessed as weak.
• D. Since all transaction occur over the computer, reliability is high and little substantive testing is needed.

Answer 1

The correct option is B Auditors often need to plan ahead to capture information about selected transaction over the EDI.

Electronic data interchange (EDI) is the movement of business documents electronically between or within firms (including their agents or intermediaries) in a structured, machine-retrievable, data format that permits data to be transferred, without re-keying, from a business application in one location to a business application in another location.