Many clients have their data processed at an independent computer service centre (IT outsourcing).The difficulty the independent auditor faces when a computer service centre is used lies in:
A) finding compatible programs that will analyse the service centre's programs.
B) determining the adequacy of the service centre's internal controls.
C) gaining the permission of the service centre to review its work.
D) trying to abide by the Code of Ethics for Professional Accountants to maintain the security and confidentiality of the client's data.

Question

Quizplus · Accepted Answer

The difficulty faced by independent auditors when a computer service centre is used is determining the adequacy of the service centre's internal controls. This is because the service centre may have its own internal controls that are not transparent to the auditor, and the auditor must ensure that the controls in place are adequate to protect the client's data.

Many Clients Have Their Data Processed at an Independent Computer