Peter Drucker once said, “If you can’t measure it, you can’t improve it.” That quote also rings true for IT audits. IT audits keep leaders informed on how well IT processes are being run, and empower leadership with better data in hand. 

But what exactly is an IT audit and what’s the best way to go about running one? This guide walks through the importance of a thorough IT audit as well as a checklist IT teams can use to implement one. 

Here's what we'll cover in this guide:

What is an IT audit?

An information technology (IT) audit is when an auditor reviews, analyzes, and assesses the state of IT infrastructure, information assets, and cybersecurity. The audit process checks for compliance, efficiency, and IT risk management integrity. It can extend to anything relying on an IT infrastructure, including: 

The tech industry might also refer to it as automated data processing (ADP) audit or computer audit. IT audits were also once called electronic data processing (EDP) audits. Still, it’s the same process with the same general goals in mind. 

Why is an IT audit important?

The importance of an IT audit goes beyond the IT department. The management of IT trickles into the rest of the organization. For example, an IT audit can help businesses establish trust with their customers because a business that has taken the time to harness IT best practices is less prone to costly security breaches.

Other benefits to running an IT audit include:  

Better business performance

Organizations that conduct regular IT audits tend to have a better opportunity to outperform others because of the data available to them. Audits confirm the company’s health, identify opportunities for improvement, and ensure IT aligns with business objectives. An audit can also review the state of the company's SaaS stack, SaaS spend, data integrity, development, IT governance, and security.

Simply performing an audit can also improve communications between departments while testing for any gaps in system and process integrity. This process can be time consuming, but it’s where workflow software can help streamline communications and build better systems. 

Better IT governance

The vital function of IT audits is to ensure employees meet business laws, compliance, and regulations requirements. In achieving security compliance or certification, an IT audit can provide credibility to the company’s operation.

Reduced cyber threat risk

IT audits ensure the company protects its sensitive data by checking for appropriate hardware, software, and personnel. Organizations that rely on technology could suffer from technological errors if left unchecked, which leads to cyber threat vulnerabilities.

Additionally, audits evaluate business processes and systems to identify possible information security risks. These risks could leave the company’s data open to external and internal attacks.

How to implement an IT auditing process for the first time

There isn’t one way to implement an auditing process. Many decision points in the auditing process depend on the particular business and its goals.

Here’s a general process that can help establish an auditing plan of action. This plan can be customized based on each unique part of the business. 

Establish an IT auditing standard

Before conducting an audit, the organization should establish an IT auditing standard.

To do this, start by asking these three questions:

  1. How often should the company conduct IT audits?
  2. Which type of IT audits should the company run?
  3. Which audits are necessary to achieve and maintain compliance with business laws and regulations?

Once each question is answered, whether by consulting with a third-party auditor or getting answers in-house, the company is better equipped to establish an IT auditing standard.

Check out the: Ultimate SOC 2 Compliance Checklist

Employ an IT auditor 

Organizations might need to hire internal or external auditors to assist in the IT audit process. Internal auditors might run the day-to-day auditing while external auditors might be called in for special projects. 

What does an IT auditor do?

An IT auditor analyzes and conducts a company’s IT infrastructure risk assessment. IT auditors aim to identify obstacles that prevent the organization from achieving compliance, maximizing efficiency, and managing risk effectively.

Should an auditor find an issue, they submit audit reports to IT stakeholders, which may include recommended solutions, change processes, and systems.

An IT auditor is responsible for developing, implementing, testing, and evaluating audit review procedures. Using several frameworks, IT auditors can test the effectiveness and efficiency of the company’s operations, data accuracy, and information authenticity.

An IT auditor will conduct several types of audits, including:

  • Client-server telecommunications intranets and extranets
  • Information processing facilities
  • Innovative comparison audit
  • Management of IT and enterprise architecture
  • Systems and application control
  • Systems development
  • Technological innovation process
  • Technological position audit

When is an IT audit necessary?

Any company should conduct routine internal audits as part of a health checkup on its systems and operations. It’s up to an IT audit manager what cadence meets the needs of the systems and stakeholders - monthly, quarterly, or annually.

However, audits are necessary for compliance, especially when it comes to business laws and regulations. Some companies run twice a year audits with interim audits in between. 

What are the types of IT audit?

There isn’t a one-size-fits-all audit. Instead, IT audit managers can pick and choose which audits are appropriate to run for the needs of the company.

Here’s a list of the different types of IT audits to consider:

  • Systems development: This audit helps confirm that systems that are being developed are compliant with the standards set by the organization. 
  • Systems and applications: This audit checks that systems and applications are secure, efficient, and reliable.
  • Telecommunications: Audits network security to help protect against a potential breach.
  • Information processing facilities: Auditing information processing ensures that all processes are working well.  
  • Management of IT and Enterprise Architecture: This audits IT management and how well structured and efficient it is. 

Top objectives of an IT audit

There are several reasons for running audits throughout the year. If met, these IT objectives only work to make an organization stronger by fueling sustainable business growth. 

Some of the most important IT audit objectives include: 

  • Securing data assets by safeguarding against possible breaches
  • Meeting and maintaining the organization’s operational objectives
  • Compliances with laws and regulations
  • Optimized use of the organization’s resources
  • Ensuring information is reliable

The IT audit process

A general IT audit consists of five steps in three general phases: planning, doing the field work and reviewing it, and reporting.

The five steps to a proper IT audit are: 

  • Planning: Before running an audit, the auditor plans the audit procedure according to compliance needs and policies. 
  • Evaluating: Stakeholders meet to discuss and adjust the audit plan as needed once more information is on hand. 
  • Testing and assessing: Perform IT testing and assessments with the involvement of stakeholders from each department. 
  • Reporting: The scope of the audit is reported as well as any findings that push for the appropriate recommendations. 
  • Follow-up: Several months after the audit a review is required to ensure the recommendations and corrections were implemented. 

IT audit checklist sample

While an organization might need to modify the list to fit its needs, this IT audit checklist will provide a helpful framework. 

 IT Security

Security checks refer to the company’s physical security, IT systems, and how they handle and protect sensitive data. Evaluate:

  • Access point and IT controls for proper authorization and function
  • Firewalls and intrusion systems to find holes
  • Procedures for proper documentation
  • Software to test how it manages sensitive data and its internal controls
  • Wireless networks to test for soundness

Regulatory compliance

An organization might need to meet compliance with business laws and regulations for certification or merely general business health. To audit this area, evaluate the following standards that pertain to the company's industry:

  • Business laws like the Health Insurance Portability and Accountability Act of 1996 (HIPAA)
  • Regulatory requirements like the Payment Card Industry Data Security Standard (PCI DSS)

For a more comprehensive list, check out “What Every SaaS Business Should Know About Compliance

Licensing

Does the company have the proper licenses for all the software applications the employees are using? To run a licensing audit, consider the following steps:

  • Find and account for unathorized software that may be in use
  • Account for records of subscriptions and licenses
  • Establish a vendor renewal workflow to avoid expired contracts

Data backups

The company should make data backups a part of its disaster recovery and business continuity planning. All companies should audit the process regularly to evaluate:

  • Business continuity (estimated downtime costs and affordability)
  • Last tested backup method
  • Offsite data storage
  • Time-span for a backup system recovery

Hardware

Even SaaS companies must have some hardware (like computers), and it’s vital to know what the company owns and how it’s used. To help, an IT asset management system with a configuration management database (CMBD) can maintain this inventory list. An audit list should include:

  • Hardware inventory
  • Hardware age
  • Hardware performance demands

IT management

It’s good practice to audit the company's own IT department too, as there can always be room for improvement. IT management audits can help show where an IT team is falling short. Consider the following steps when auditing an IT team:

  • Is staffing appropriate for healthy admin workload?
  • Are admins responses to issues efficient and appropriate? 
  • Are backups being handled correctly?
  • Are security issues attended to in a timeline manner?
  • Do they run root cause analysis when appropriate to keep errors from repeating? 

How Vendr can help with your IT audit

Vendr is suited to complement and support IT audits—from reviewing your SaaS tools and SaaS spending to checking compliance and security. Vendr can help automate your workflows for faster and more frequent interviews, data collection, and analysis automation.

Get an inside look into the platform where you can discover and buy new tools, see how much you're saving on software, and stay up to date on  your IT stack with our free guide to the Vendr SaaS buying platform.

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