Local Government IT Audit and Controls Report Analysis

This report provides a comprehensive analysis of an IT audit report focusing on a local government's information technology systems, policies, and operations. The analysis begins with an introduction to IT audits and their importance in ensuring data integrity and aligning with business objectives. The main body of the report delves into the analysis of the audit report, covering audit findings and irregularities related to IT governance, IT controls, and cyber security management within the local government. The report highlights specific issues, such as deficiencies in financial reporting, internal controls, and cyber security practices. Furthermore, the report examines the audit strategies and actions employed, including reporting objectives and the three stages of planning, data collection, and reporting. Finally, the report offers suggestive measures to overcome the identified irregularities, emphasizing the need for improved governance, formal IT policies, and enhanced cyber security practices. The report concludes by summarizing the key findings and recommendations for strengthening IT systems and controls within the local government.

IT Audit and Controls

Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Analysis of audit report..........................................................................................................3
Audit findings and irregularities found in report....................................................................5
Audit strategies and actions....................................................................................................7
Suggestive measures to overcome irregularities....................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
IT audit termed out as an examination and evaluation of an organisation information
techniques, policies and operations (Abbott and et. al., 2018). Hence, controls protects, assist to
ensure data integrity and mainly aligned with business overall objectives. Thus, information
audit system defined as an examination of managerial controls within the infrastructure of
information technology. Additionally, IT audit and security put their major focus procedure that
supports to gather and evaluate evident that helps to determine that whether the computer system
safeguards assets and also allows entities accomplished the objectives.
The present report is based on to analysis of IT audit report on Local government 2019.
Also, report will cover the irregularities found in report relates with IT issues. Furthermore,
discussion will be conducted on strategies and actions that will support to overcome
irregularities. Lastly, suggestive measures will be framed out to cope up with future course of
action.
MAIN BODY
Analysis of audit report
Audit report can be defined as an opinion of auditor that mainly links with concerning the
examination of entity financial statement.
Audit focus and scope-:
The one of main purpose of key business application of the number of government
entities (Abernathy and et. al., 2017). Each application needs is crucial for undertaking IT control
operations in government enterprises. Thus, report will focus on issues relates with Audit
findings and issues in NSW city council, Issues of IT governance, Finding of IT controls in NSW
and findings relates with cyber security management in NSE city.
Audit findings and issues in NSW city councils
Financial reporting termed out as crucial element of the good governance. There was
reduction in number and value of dollar errors identified in NSW city councils. Unqualified audit
opinions were issued for 99% of completed audit for council and joint organisation. An
disclaimed audit opinion was issued for the 30th June 2018 financial statements of bayside
council. It was report that based on management being unable to confirm that the financial

statement presents financial performance and position of the cousin because of control
deficiencies in the council financial accounting system.
Audit findings relates with IT governance.
As per this, findings has been generated as financial audit focus on key governance
matter and internal control supporting preparation of the council financial statements. Internal
control is for to manage the risk of material error. However, with help of finding this has been
stated that report control deficiencies investigated to management and and those charged with the
council. Therefore, issues are rated as high, moderate and low risk accordance with framework
of risk management (Bezzaoucha and Voos, 2020). Thus, one of the major issues was as not to
review internal control and governance. High risk issues were as lack of processes to verify the
completeness and accuracy of revenue. Council was unable to generate list of outstanding rate
level that affect the effectiveness of debt collection procedure. In the council, there was no
formal review of process to acquit expenditure of credit card. Hence, inappropriateness in the use
of purchase order all are creating the issues with IT governance in council. Therefore, ineffective
legislative compliance enhance the risk of council as this leads to breaching legislation.
Audit findings relate with IT controls in NSW
As per the findings, this has been suggested that strong governance system and internal
control councils operate the all over functions effectively and efficiently. In the year 2018-19,
the total number of the issues that has reported in the management letters enhanced as compared
to previous year (Habib and et. al., 2019). However, the high risk issue have decreased. Out of
the high risk issues, 41% deficiencies has been found in information technology control. With
the help of report this has been found out that fraud control procedure and system. Hence,
significant variation has been found in the in the quality of fraud control in the entire council.
Audit finding relate with cyber security management in NSW city
Information technology mainly uses to deliver services and manages information. As per
the findings, this has been found that with help of audits investigated 575 issues relate with
information technologies (Isinkaye, Soyemi and Arowosegbe, 2020). Thus, IT control
deficiencies in management letter gas enhanced with the prior year. In addition to this, cyber
management need involvement with some component of governance. Therefore, the poor
management of the cyber security that expose council to the broader range of the risk that
includes financial loss, data breaches and reputational damages. Thus, the potential impact will

be covered theft of money, destruction of data and their party losses etc. Therefore, cyber
security management needs improvement as most of the council yet to execute the basic
components of governance. IT system must uses to support the service delivery that is outside
the scope of the financial audit.
Audit findings and irregularities found in report.
Financial reporting and Performance
Audit of financial reporting and performance suggests that financial statement were free
of material misstatement and qualify to be relied by users while making informed decisions.
This year’s financial statement identified less errors in number and value of dollar compared to
prior year.
Prior errors were identified in this audit report which is concerned with poor asset management,
errors in comprehensive revaluations, assets not carried at fair value and others (Thomas and
Purcell, 2019). This report also found reasons because of which council required extension in
their submission and these are resourcing issues, poor financial records, data migration issues
and delay in asset values.
This audit report also includes implementation of three new accounting standards. Reason for
this is that this will materially impact the financial statement. This was based on identification
and reporting of 60 instances where management could be better prepared for changes in
accounting standards and this was an improvement from the previous year.
This audit found that councils require to work more on their impact assessment to minimize the
risk of errors.
Regarding financial performance audit was carried out against six financial performance
indicators (Zhukun, Wang and Zhang, 2018). Regarding performance of all the councils on
various levels has been performed better than previous years.
Governance and Internal Control

Regarding governance and internal control the findings includes that total issues in
management letters has increased. In this issues with high risk has decreased and issues with low
risk has increased and slight increase in moderate risk issues has also recorded in the report.
Among these 14 percent issues recorded were repeated issues.
In relation with governance issues of moderate issues has increased and fifteen percent of these
are repeated issues.
One of the irregularities found in this is that all the issues related to internal control and
governance are not reviewed. This possesses possibility that aspect which has not been reviewed
in a year can increase their issues in higher number because they have not been reviewed cause if
they would have been resolved comparatively early.
Information Technology
Related to information high risk issues has been decreased in 2018 they were 39 in 2019
they decreased to 29 but unlike this moderate risk and low risk issues has increased in 2019.
Related to IT governance report includes that IT policies are not formalised and have not kept up
to date which is important for proper governance (Che and Bao, 2019). Related to IT general
control user access management is improving at the councils instead of increasing risk of
unauthorised access and misuse.
This report states that control over IT system needs to improve and disaster planning and testing
also needs to improve. This report also states that response of council also needs to improve its
response to cyber security risks.
Asset Management
Total number of issues has increased and issues with high risk have decreased.
Overall findings of this report are that most of the issues are related with IT and then issues are
related with asset management at council.

Irregularities of the report is that aspects considered for the purpose of audit report are limited
and do not include factors such as transport and communication and education system at local
government because these are significant part of the overall spending of the government.
One of the irregularity of the report also includes that data related to previous year was lacking in
qualitative form to improve the comparison in qualitative form.
Audit strategies and actions
Audit strategy which has been used for the purpose of this report is reporting objectives.
This is because audit when is based on this strategy of the report limited points are considered
which are major and require immediate attention (Dollery and Piper, 2020). This report has
special focus on strengthening control over information technology and cyber security
management. Asset management improvement is also a objective of this audit.
This report is also focused on credit card management, Fraud control, Gifts and benefits,
Cyber security and Landfill rehabilitation. All these things suggests that strategy chosen for this
is reporting objective for the government. This includes reporting about local government in
different aspects. This also focuses on characteristic of engagement as this audit included local
governments and councils they provided information and on the basis of that this audit was
carried out.
This audit also is based on the strategy so that it can direct the efforts of the local
government through results which has been summarized in the report. For example excessive
issues related to cyber security and asset management will enable local government to take
adequate actions and they can be based on this audit report. This report pays special focus on
cyber security and related issues and this will enable the local governments to take measures in
that direction so that IT system and cyber security can be strengthened at local level of the
government. The overall audit strategy of this audit was developed and carried out in three stages
which are Planning, Data collection and reporting.
Planning included that firstly planning was carried out for the audit this involves determination
for the purpose of audit and this answers why the audit is being carried out and also focuses on

the centre of the audit (Horne, 2017). In this audit was carried out to strengthen IT and cyber
security and also asset management at local level.
Data collection is another step of the audit strategy which involved collection of data and
for this management letter were gathered and information about issues in various aspects was
collected from these letters for the purpose of audit. Reporting was the last stage of audit strategy
and this included analysis of data and its classification which was collected from local
government. This also involved comparison of data from the data of previous year to establish
accurate understanding and positive and negative impact on various aspects because of
government performance.
Suggestive measures to overcome irregularities
There are different process can be used by auditing team to develop effective report in order
to develop better presentation in report. Some of the steps can be used by the organization to
develop better auditing report. Organization can develop better goals and objective in order to
develop better report for the audit. Effective goals and reports can be prepared by the
organization prepare better report. Some processes can be considered in the report to stick to the
objective. For example illustrating non-conformities, outlining, outgoing and opportunities for
improvement. These considerations can be used by the organization to stick to the topic. The
report should be prepared with considering target audience. By this process auditing process can
be created more specific report as per the interest of the target audience. Through these process
organization can develop better report for the target audience. The complexity of the report is
highly dependent on understanding of target audience. Various types of the audits are need to be
considered in the repot to develop report with effective formatting and style. These all type of
reports can help the auditing organization to develop better response from target audience. I the
auditing process various opinions of the audit report should be considered in the report to
develop better report for the Information Technology Audit for the organization.
There are different outline for the report should be prepared in order in order to develop
better planning of report that required in the research process to develop audit report. There are
various considerations can be made in report to get effective report for the auditing process. For
example perspective for the reader should be provided in the auditing process. The auditing
process report needs to be more precise, redundant phrases should be avoided and in text

terminology should be considered in the auditing report. Passive voice should not be used in the
report to avoid irregularities in then audit report. Bullet points need to the provided in the report
for specific report. The terms that are need to be gender neutral. Buzzwords should be avoided in
the audit report (Dollery and Piper, 2020). The report style that is used in the report should be
considered in the initial level of the report preparation to get better output with the report. There
are some processes can be considered by the auditors. For example date of audit, areas of audit,
standards used in auditing report, auditing team should be leaded in effective manner to develop
proper report. People that are considered in audit should be interviewed in the research process.
Good points are need to be considered in audit report to develop better overview of data that is
provided in the research process. Proper observations need to be made in the report to get better
result with the people the report shod have various steps should be followed in the research
report to offer better start to the auditing report. The purpose and scope of the audit report should
be considered for effective develop development of the report.
CONCLUSION
Hereby, this can be summarized that above audit report aids to analyse that information
technology audit is one of significant thing that assist to carried out within an enterprise. This
supports to ensure and maintain data integrity, requirements, align needs with the well defined
objectives. Additionally, IT audit assist in gather all the over information and also identified
issues faced by them and ways with help of which that issues can be resolved.
The present report has covered on the analysis of IT audit report on Local government
2019. Also, report has covered the cover the irregularities found in report relates with IT issues.
Furthermore, discussion has been conducted on strategies and actions that support to overcome
irregularities. Lastly, suggestive measures has been framed out to cope up with future course of
action.

REFERENCES
Book & Journal
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(ISERSS 2019). Atlantis Press.
Dollery, B. and Piper, D., 2020. Council cooperation in New South Wales: Why have some
councils not joined joint organisations?. Economic Analysis and Policy.
Habib, A., and et. al., 2019. Determinants of audit report lag: A meta‐analysis. International
Journal of Auditing. 23(1). pp.20-44.
Horne, S., 2017. 27 Years of fraud control in the New South Wales public sector: 1989–2016.
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System for Class Attendance and Malpractice Control. International Journal of Computer
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