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Key Technologies For Audit Teams

Column: From the Trenches

From the Nov. 2006 Issue

One of the unexpected benefits I’ve received by visiting so many tax
and accounting firms in 2006 was solving day-to-day technology problems that
seem to be present in most firms. The key technologies that I’ve observed
not installed properly at firms this year include surge protection and UPS,
cabling, multiple monitors, backup systems, firewalls, and security systems.
These technologies are all fairly well established, and the rules and understanding
of how to deploy most of these technologies have been consistent for more than
10 years. More recent changes in how to set up firewalls and security with greater
protection would be the exception to this statement. So please listen carefully
to my first point in this month’s article: Check your existing technologies
to make sure that they have been installed properly. Every firm I have been
to in 2006 has these problems. I was so shocked by this trend of improper implementation
that I have actually created a series of articles on how to do these basics
properly. I suspect your firm has these issues and others, as well. But in this
article, I am only going to address the key issues of technologies for your

Technology tools to make audit teams more productive have become easier to
use and more sophisticated at the same time. The key issues for field auditors
include the following:
1) Connection to other auditors and sharing files and equipment in the field,
2) Connectivity back to the office and to the Internet,
3) Security of data and their equipment, and
4) Maintaining productivity while in the field.

A cookbook of products to consider will be provided later in this article,
but first let’s address these four key areas:

  • Connection to other auditors and sharing files and equipment in
    the field

    Issues of easily connecting computers in the field have plagued auditors for
    several years. This continues to become more critical as auditors spend more
    time out of the office, and audit engagements occur in more months of the
    year. The best solution I have found in this category is Colligo Workgroup
    Edition. This Canadian vendor has simplified peer-to-peer networking. I refer
    to it as networking for accountants as opposed to networking for techies.
    Colligo allows configurations for use in the office and field, and emulates
    several server technologies to make connections work easier and correctly.
  • Connectivity back to the office and to the Internet
    Some firms have gone so far as to prohibit connection to client networks as
    well as the use of wireless and WAN data cards. I understand this from a security
    risk perspective, but it is a killer for an auditor’s productivity.
    I prefer to run appropriate levels of protection in firewalls, virtual private
    networks (VPN), and encryption for wireless. WAN cards have become fast enough
    that we can create our own links without using a client’s network, and
    this also keeps us from dealing with belligerent IT departments that don’t
    want outsiders to connect to their LANs. The downside is that not all markets
    have the true high-speed access of WAN cards available.
  • Security of data and their equipment
    With the high-profile headlines of data theft as well as identity theft, firm
    laptops are great targets for criminals. I prefer to use a product like PGP
    Universal Series 200, which encrypts the entire laptop drive, any USB used,
    and any e-mail that is sent. Additionally, I prefer to have all wireless connections
    using 802.11i or WPA2 encryption along with a VPN encryption. If all of these
    encryptions are in place, hackers will have to break through several levels
    of security to get to any communication. The encryption used by PGP has yet
    to be broken, so the theft of a laptop with an encrypted hard drive should
    not produce any useable data for the criminal.
  • Maintaining productivity while in the field
    The issue here is driving up realization while producing a better end product,
    and not giving the extra profitability away in future audit engagements. We
    know it is painful, or in some cases impossible, for auditors to carry all
    equipment listed below to a remote engagement via an airplane. Consider shipping
    equipment when long engagements are going to be remote where the client can’t
    provide comparable technical facilities. For auditors who drive to see clients,
    this equipment can be easily carried in a car. The key pieces of technology
    that can help with productivity are multiple monitors, scanners and Internet
    connectivity. If you have Internet connectivity, you can also gain access
    to firm files, e-mail, Internet research, and possibly Voice over IP (VoIP).

Remember, specific products mentioned below were among the best choice at
the time this article was written, and given as examples of what works. You’ll
need to review for successor or superior technology when you are ready to make
your purchase.

What technology tools in both hardware and software can make your
auditors more productive?

  1. Hardware
    • Laptop — A larger screen is better, and both wireless LAN and
      WAN built in is better. HP, Toshiba, Lenovo, Dell, Apple.
    • Cell phone/combination PDA — It’s better to have remote
      e-mail access in these devices, as well. This is needed less if the soft
      phone below is included. Treo 700, Blackberry, HP iPaq. Add software like
      PDAnet if high-speed connectivity is not included with your phone.
    • High Speed WAN Card — This is to connect the audit team to high-speed
      cellular service. Novatel Merlin S620 on Sprint.
    • Wireless Firewall — It’s better if it supports the high-speed
      WAN card as well as hard wired connections. Kyocera KR1.
    • Production-quality portable scanner or a multi-function scanner/printer
      (MFP). Canon DR-2580C, Fujitsu fi-5120C, Fujitsu ScanSnap S500 or HP 4315.
    • A second monitor when the engagement is going to keep people out for
      more than two days. ViewSonic ve710b, Planar 1500.
    • Encrypted USB for backup of files on a regular basis. Lexar JumpDrive
      Secure II, JumpDrive TouchGuard SAFE PSD S1100 or use of the encryption
      software listed later in this article.
    • Network Attached Storage (NAS) — This is a larger disk device
      to save and share all files from a single location. Maxtor Shared Storage
      Drive H01P200 (or larger).
    • Surge protection to share the limited power available. APC PNOTEPROC6
      for in-line protection, a PER8T to share with all.
    • Optional keyboard in case the auditor wants to work from a large keyboard.
    • Optional 10-key with USB connection. Targus PAUK001U.
    • Your auditors may be happier with a larger laptop with the 10-key built
    • Locking cables — Although these are only a marginal defense,
      try Targus PA400U.
    • Mouse that always stays in the portable bag.
    • Universal power adapters — These allow you to recharge your laptop,
      cell phone and other electronic devices. iGO everywhere 130 with the appropriate
    • Roller style of bag — You’ll want one that can hold all
      of the above and make them easier to move. TravelPro Platinum 4 #9422
      or Wenger Patriot.
  2. Software
    • Audit Engagement Management Software — CaseWare Working Papers,
      Engagement CS or ProSystem fx Engagement.
    • Practice Aides — PPC eTools advisement/template software.
    • Research software — CCH, RIA, BNA.
    • Specific audit tools — ACL, IDEA, ActiveData, AuditMaster, ProfitCents,
    • Productivity software for word processing, spreadsheets and e-mail
      — Microsoft Office.
    • Software to create *.PDF files — Adobe Acrobat.
    • Peer-to-peer networking software to make field connections and sharing
      easier — Colligo WorkGroup.
    • Encryption software to protect your hard drives, USB and e-mail —
      PGP Universal Series 200.
    • Backup software to copy all files easily — Second Copy.
    • Softphone software that allows your remote auditor to connect to your
      VoIP phone system directly. This is typically supplied by your VoIP vendor.
  3. In the office
    • Remote access to the server including files, document images, and e-mail
      — Citrix or Terminal Server.
    • Scheduling software, possibly covered in your workflow solution —
      XCM Solutions.
    • Voice over IP (VoIP) phone system — Cisco, Avaya, 3Com, InterTel.
    • Confirmation letter solution — Capital Confirmation.
    • Audit budgeting software — Excel, Practice CS, ProSystem fx Practice
    • Time and Billing system with remote time and expense entry —
      Practice CS, ProSystem fx Practice Management.
    • Docking stations for the laptop, properly surge protected, possibly
      with dual monitors (total of three monitors with laptop screen) —
      Targus ACP50US.
    • Second set of mice, keyboards to minimize setup and tear down time.
    • High-speed production-quality scanners to turn client paper documents
      into electronic files — Fujitsu fi-5750C or Canon DR-7080C.

With this selection of hardware and software products, you have a formula for
success. However, as an audit manager, IT manager or firm administrator, you
must help your auditors picture how this equipment will work for them. Preparation
before leaving the office will be a necessity. An auditor should carry all of
the necessary files to the field on their laptop or NAS, with all supporting
documentation scanned in advance, and organized in the engagement management
software. All of the appropriate equipment can be transported in a wheeled bag.

When the audit team arrives on the first day of the engagement, they can set
up their tools either together or separately depending on the client-designated
workspace. Complete setup should take place in less than 15 minutes. The setup
process would be as follows:

You are now ready to begin running the engagement management software using
files on a laptop or on the NAS. Make sure that the shared resources are not
connected via the audit manager’s machine since the manager will frequently
move from one audit engagement to another, and could easily take key needed
resources with them when they leave.

Only a few of the software and hardware tools named earlier are beyond what
a typical auditor carries today. The new tools include the following: WAN card,
second monitor, peer-to-peer networking software, encryption software and a
Softphone. The total cost of additional hardware and software to make field
auditors more productive is roughly $300 for software and $1,200 for hardware.
Ongoing costs for the WAN card are currently around $60 per month. Most audit
teams will gain enough billable time in the first engagement to justify these
expenditures, plus your firm will be better protected with all data off-site
encrypted. Using the right technology tools will increase the realization across
all audits and keep your auditors in better communication with the firm. 


Mr. Johnston is executive vice president and partner of K2 Enterprises
and Network Management Group, Inc. He is a nationally recognized educator, consultant
and writer with over 30 years experience in strategic technology planning, systems
and network integration, accounting software selection, business development
and management, disaster recovery and contingency planning, and process engineering.