Content area
Full Text
Keywords
Real time, Accounting system, Information technology, Information systems, Internet
Abstract
Technological advances (e.g. e-commerce and the Internet) have changed business practices and the process of recording and storing business transactions. Extensible Business Reporting Language (XBRL) will soon be built into accounting and reporting software which would allow on-line real-time preparation, publication, examination, and extraction of financial information. Thus, outside, independent auditors should use continuous, electronic auditing when most financial information exists only in electronic form under real-time accounting systems. Continuous auditing and its implications for independent auditors, including internal control considerations and audit procedures, are described and analyzed.
Introduction
The emerging information technology (IT) has spawned new business approaches such as electronic commerce, electronic data interchange (EDI), and the Internet. These approaches have changed business practices and the process of recording and storing business transactions. Doing business on the Web through the use of Internet technology enables organizations to connect into the on-- line world and improve all aspects of their business. The Web site can improve selling products or services by giving options to existing or potential buyers to purchase products or services directly on-line. Business transactions can now be in electronic form without any paper documentation, enabling organizations to produce financial information on a real-time, on-line basis. Most recently, businesses are shifting from relatively costly EDI to less costly and more flexible Extensible Markup Language (XML). Furthermore, Extensible Financial Reporting Markup Language (XFRML) is also being developed to facilitate companies in sharing financial information.
The new information technologies (e.g. the Internet, EDI, XML, XFRML) have crossed national boundaries to change the way organizations operate. Many entities now disclose their quarterly and annual reports on the Internet. Extensible Business Reporting Language (XBRL) is now receiving support and popularity from the financial community and the accounting profession. XBRL is a standardized electronic language for business reporting which facilitates the preparation, publication, examination, and extraction of financial information. Under XBRL, the information is entered only once and it can then be rendered in any form, such as a printed financial statement, an HTML document for the company's Web site, and EDGAR filing document for the SEC, or any other specialized reporting format (Zarowin and Harding, 2000). SBRL fosters effective and efficient preparation,...