While planning the audit of a company that heavily relies on automated processes, the auditor notices that several key financial reports used for…

IT dependencies are created when IT is used to initiate, authorize, record, process, or report transactions or other financial data for inclusion in the financial statements. System generated reports are the information generated by the IT systems. These reports are often used in an entity's execution of a manual control, including business performance reviews, or may be the source of entity information used by us when selecting items for the testing, performing substantive tests of details or performing a substantive analytical procedure. e.g. (Vendor master report, customer ageing report). Interfaces are programmed logic that transfer the data from one IT system to another. For example, an interface is programmed to transfer data from a payroll subledger to the general ledger. In this manner, IT dependencies arise due to “system generated reports" and "interfaces". Identifying and documenting the entity's IT dependencies in a consistent, clear manner helps to identify the entity's reliance upon IT, understand how IT is integrated into the entity's business model, identify potential risks arising from the use of IT, identify related IT General Controls and enables us to develop an effective and efficient audit approach.