2010-01-AU Limited Scope Performance Audit of Department of Water Supply's Internal Controls for Cash Handling and Financial IT Systems

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CHAPTER 1: AUDIT PLAN Audit Objectives • Assess the control environment, including management's policies and procedures for establishment and maintenance of an effective internal control system. • Assess the adequacy of internal controls relating to cash handling activities, including: • Adequacy of written policies and procedures. • Functional compliance with written policies and procedures. • Adequacy of separation of duties and reporting, reconciliations, and reviews of cash handling activities. • Safeguarding of cash. • Timely receipt and deposit of cash. • Adequacy of internal controls over cash handling activities of satellite offices. • Assess the adequacy of internal controls of systems and application activities relating to the Department's financial IT systems, including: o Adequacy of policies and procedures for IT security, passwords, access rights, user groups, backups, and disaster recovery. o Adequacy of separation of duties over IT financial systems activities. o Adequacy of physical security over IT computer server rooms, workstations, and networks. o Adequacy of systems processes to monitor and report on IT systems activities. o Adequacy of internal controls of networked IT systems. 2