Electronic data interchange (EDI) is the concept of communicating information between two
parties, such as between auditors and clients, or from auditor to auditor, through the means of
technology. This also allows for the exchange of electronic signatures, invoices, and more, in a way
that is confidential and secure. (Leech, Dunne, & Malone, 2022) Image-processing systems often
work alongside EDI systems, as they allow for the conversion of physical images electronically. A
common example of this system would be Adobe, which allows for the conversion of scanned
images, where you can then store the image in your computer and exchange it with others
virtually.
Looking at our final project, Earth wear Clothier's utilizes an EDI system. They use this for the
purchasing of goods online in a safe and secure manner. Using this, they can exchange orders and
invoices with suppliers completely electronically, eliminating the burden and risks associated with
using large amounts of paper and completing the process manually. (Messier, Glover, & Prawitt,
2019) This system makes it easier for auditors to gather the data needed to conduct their review,
as well. It is much simpler to review virtual data than it is to sort through large volumes of paper.
This method also simplifies the process of sample selecting, as the auditors can sort the data and
extract only what they need.
In the audits that I conduct, image-processing systems are essential. My company utilizes Adobe to
its fullest extent. Occasionally, I do receive data in the form of hard copies. From there, my first
task is to scan the documents into my computer and convert the scanned documents into an
Adobe PDF. For auditors, this makes it much easier to call out certain parts of the documentation
and leave notes where needed, as well as store the information and incorporate it into the virtual
audit program. My company is working to reduce all paper usage to near zero, so understanding
EDI systems is essential for all departments - not just internal audit. EDI (Electronic Data
Interchange) and image processing systems is a communication system for exchanging business
data electronically. d The use of paper is eliminated. d With the use of EDI, auditors can send and
receive all information electronically instead of making copies of support provided by clients.
Additionally, using image processing, an image is converted into a digital format.
In Chapter 5, it is noted that the auditors use audit evidence information to arrive at the
conclusion on which the audit opinion is based (Messier, Glover & Prawitt, 2017). d Audit evidence
must be both sufficient and appropriate to support the opinion rendered (Messier, Glover, &
Prawitt, 2017).
In recent years, many companies are transitioning to an electronic base. d As an auditor, it is
essential to understand how electronic data can affect audit evidence and documentation.
Auditors might encounter an issue with electronic support in regards to errors that could range
from data transmission errors to deliberate manipulation data (Williamson, 1997). d Furthermore,
auditors need to verify if the support is credible and no signs of alteration. d Electronic data’s
negative aspect is that it is difficult to note an any signs of modifications. Thus, auditors should
investigate the documentation provided by the client thoroughly. d Additionally, auditors will need
to address the scope of the procedures necessary to ensure competence of evidence and
understand how electronic evidence is extracted from the information system (Williamson, 1997).
References
Messier, W. F., Jr., Glover, S. M., & Prawitt, D. F. (2017). Auditing & assurance services: A
systematic approach (10th ed.). New York, NY: McGraw-Hill Education.
Williamson, A. Louise. (1997, Feb 1). The Implications of Electronic Evidence. Retrieved from
Journal of Accountancy: https://www.journalofaccountancy.com/issues/1997/feb/implic.html
Messier, W., Glover, S., Prawitt, D. Auditing & Assurance Services: A Systematic Approach.
McGraw-Hill Education.
Leech, S., Dunne, J., & Malone, D. (2022). A framework to model bursty electronic data
interchange messages for queueing systems. Future Internet, 14(5), 149.
https://doi.org/10.3390/fi14050149
