Why Microcomputers May Increase the Cost of Doing Business

Why Microcomputers May Increase the Cost of Doing Business

Gary Adna Ames (University of Nebraska-Lincoln, USA)
Copyright: © 1993 |Pages: 8
DOI: 10.4018/joeuc.1993100102
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Abstract

Auditors play an important role in the function of all publicly traded businesses. The amount of time that an auditor spends performing the audit impacts the financial picture of the company in two ways. First the actual cost of the audit to the client is directly impacted by the cost of the auditor’s time. Secondly, the client pays for the time its employees spend assisting the auditors. The current research explores the reaction of auditors to the introduction of microcomputers in the auditing environment. Specifically, this paper shows that the introduction of microcomputers may increase the cost of an audit to the company. This occurs because auditors tend to increase the amount of testing required to complete the audit. This increase obviously causes an increase in the total costs of the audit itself in addition to an increase in the inconvenience to the company under audit.

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