（2005）Minimizing cost of continuous audit：Counting and time dependent strategies.pdfVIP

Journal of Accounting and Public Polic y24 (2005) 61–75 /locate/jaccpubpol Minimizing cost of continuous audit: Counting and time dependent strategies Jagdish Pathak a,*, Ben Chaouch a, Ram S. Sriram b a Odette School of Business, University of Windsor, 401 Sunset Avenue, Windsor, Ont., Canada N9B 3P4 b School of Accountancy, Robinson College of Business, Georgia State University, P.O. Box 4050, Atlanta, GA 30302-4050, USA Abstract Wh ydo we need to continuousl yaudit databases? The answer to this question depends on several factors, including the users and the applications that have accessed the data, the timing and the type of data modifications such as permissions or schema and so on. Man ystudies pertain to the technical feasibilit yof continuous auditing of databases, but do not consider the economic feasibilit yof such auditing. This paper helps fill this void in the literature. We examine certain strategies that have been sug- gested in the database auditing literature (see, e.g. [Orman, L.V., 2001. Database audit and control strategies. Information Technolog yand Management 2(1), 27–51]) with major and minor modifications. Orman studied the counting, periodic and hybrid audit- ing strategies with the objective of minimizing the number of errors introduced during database access. Unlike Orman whose focus is on assessing the number of errors enter- ing into the system (technical feasibility), we focus on the long run operating cost of run- ning database audit. We use results from regenerative stochastic processes to derive expressions for the long run average cost under the counting and periodic auditing strat- egies. Future directions for research are also proposed. 2004 Publis