Abstract
IT is an integral part of all organisations and consequently, all organisations should be considered as IT-affected entities. IT risk is therefore an entity risk which should be managed and mitigated through effective IT governance processes and the selection or design and implementation of IT governance frameworks. These frameworks should be designed and implemented at managerial level, however, the board and / or the audit committee should take overall responsibility for IT governance.
The auditor uses the audit report as the primary tool to communicate their opinion to the users of the financial statements. The new audit report format, which superseded the previous format in 2016, should address the audit expectation gap as well as the shortcomings of the previous format, namely, limited communication and standardised language. The most significant change in this new format is the disclosure of items that are deemed of most significance in the audit, namely, Key Audit Matters.
Through a content analysis of the JSE top 40 listed entities, it was found that those charged with governance in 39 of these entities regard IT as a significant risk and disclosed detail on IT governance or IT committees. However, although a total of 130 Key Audit Matters were raised by the entire study, none related to IT. This suggests a disconnect between the literature and the view of those charged with IT governance on the one hand, and the disclosure made by the auditor on the other.
M.Com. (Computer Auditing)