4.1. "The overall objective and scope of an audit does not change in computerized information system (CIS) environment". Comment.

Objective and Scope of an audit in Computerized Information System (CIS) Environment:

• Principal Objective: The principal objective of an audit of financial statements, that Financial Statements are prepared as per Applicable Financial Reporting Framework AND ensure that it represents true & fair view.
• Scope of an Audit: The scope of an audit of financial statements is determined by the auditor from (i)Terms of the engagement, (ii) Requirements of relevant legislation and (iii) Pronouncements of the Institution.
• The overall objective and scope of an audit does not change in computerized information system (CIS) environment but use of a computer changes the processing and storage of financial information.
• CIS  environment may affect the organization and procedures employed by the entity to achieve adequate internal control.
• Accordingly, the procedures followed by the auditor in his study and evaluation of the accounting system and related internal controls and nature, timing and extent of his other audit procedures may be affected by CIS environment.
• Thus, when auditing in CIS environment, the auditor should have sufficient understanding of computer hardware, software and processing systems to plan the engagement and understand how CIS environment affects the study and evaluation of internal control and application of auditing procedures.
• The auditor should also have sufficient knowledge of CIS.
• Thus, it is clear from the above that overall objective and scope of audit does not change irrespective of fact that whether the accounting information is generated manually or through CIS.