What is an Audit Trail ?
An audit trail refers to a situation where it is possible to relate one-to-one basis, the original input along with the final output. The work of an auditor would be hardly affected if Audit Trail is maintained i.e. if it were still possible to relate, on a one-to-one basis, the original input with the final output. A simplified representation of the documentation in a manually created audit trail.
For example, the particular credit notes may be located by the auditor at any time he may wish to examine them, even months after the balance sheet date. He also has the means, should he so wish, of directly verifying the accuracy of the totals and sub-totals that feature in the control listing, by reference to individual credit notes. He can, of course, check all detailed calculations, casts and postings in the accounting records, at any time.
In first and early second-generation computer systems, such a complete and trail was generally available, no doubt, to managements own healthy skepticism of what the new machine could be relied upon to achieve an attitude obviously shared by the auditor.
It is once iterated that there is an abundance of documentation upon which the auditor can use his traditional symbols of scrutiny, in the form of colored ticks and rubber stamps. Specifically:
(i) The output itself is as complete and as detailed as in any manual system.
(ii) The trail, from beginning to end, is complete, so that all documents may be identified by located for
purposes of vouching, totalling and cross-referencing. Any form of audit checking is possible,
including depth testing in either direction.