Chapter 1
Defining Continuous Auditing
The Real Definition
One of the significant challenges facing internal audit, control specialists, enterprise risk management teams, and business managers all over the world is being able to understand what continuous auditing is and how the approach can be used effectively. As you read through this book, keep in mind that continuous auditing has been around for decades. As I travel and speak around the world on this topic, I have found each individual team, department, or company has its own definition of what it believes the approach represents and how to maximize its value. So let us start off this educational process by establishing a clear-cut definition of continuous auditing and understanding the characteristics that make it a unique tool. The definition will be broken down into two distinct parts: (1) the formal “book” definition for personnel familiar with the audit profession and (2) the “nonaudit” definition for clients to clearly understand the objective of the approach.
Continuous auditing is one of the many tools used within the internal audit profession to provide reasonable assurance that the control structure surrounding the operational environment is:
- Suitably designed
- Established
- Operating as intended
Before discussing these three components, it is important to immediately identify a clarification regarding the definition. The assurance regarding the support structure of the operational environment is provided only for ...
