1. Introduction

A. The auditee is an online brokerage firm that provides a range of investment services to its clients. The firm’s business operations are largely dependent on the use of technology, including a variety of hardware and software systems, data networks, and communication channels. The firm’s technology infrastructure is supported by a team of IT professionals who are responsible for the design, implementation, and maintenance of the firm’s information systems and technology infrastructure.

B. The audit firm (fictitious name) has extensive experience in conducting audits of information systems and technology infrastructures for a range of clients in the financial services industry. The audit team comprises of experienced auditors with expertise in information systems and technology infrastructure, risk management, and financial services. The team leader will be responsible for managing the project, coordinating with the client, and overseeing the work of the audit team.

2. Auditee Environment

The auditee is an online brokerage firm that provides a range of investment services to its clients. The firm’s technology infrastructure includes a variety of hardware and software systems, data networks, and communication channels. The systems deployed by the firm include order management systems, trading platforms, customer relationship management systems, and various other systems that support the firm’s business operations.
The firm is subject to various regulatory requirements, including requirements related to data protection, information security, and business continuity planning. The firm has established a number of policies and procedures to ensure compliance with these regulatory requirements, including an information security policy, a data protection policy, and a business continuity plan.

3. Background

The client has requested the audit to ensure the adequacy of its information systems and technology infrastructure, and to identify potential risks and vulnerabilities that could impact the confidentiality, integrity, and availability of the firm’s information assets. The client is also interested in identifying opportunities to improve the performance and efficiency of its information systems and technology infrastructure.

4. Situation

The audit identified several areas of concern related to the auditee’s information systems and technology infrastructure. These areas of concern included the following:
• Weaknesses in the auditee’s access controls, including inadequate authentication and authorization mechanisms, and insufficient monitoring of user activities.
• Vulnerabilities in the auditee’s network infrastructure, including weaknesses in the configuration of firewalls, routers, and switches.
• Inadequate backup and recovery procedures, including incomplete backup procedures and insufficient testing of backup and recovery procedures.
• Insufficient disaster recovery planning, including inadequate testing of the disaster recovery plan and inadequate documentation of the plan.

5. Terms and Scope of assignment

The terms and scope of the assignment included a comprehensive review of the auditee’s information systems and technology infrastructure, with a focus on identifying potential risks and vulnerabilities that could impact the confidentiality, integrity, and availability of the firm’s information assets. The scope of the assignment covered the following areas:
• Information security controls, including access controls, network security, data protection, and incident management.
• Business continuity and disaster recovery planning, including backup and recovery procedures, disaster recovery planning, and testing of business continuity and disaster recovery procedures.
• IT governance, including IT policies and procedures, IT risk management, and IT compliance.

6. Logistic arrangements required

For the execution of the audit of the online brokerage firm, the following logistic arrangements are required:
• Access to the online trading platform and related software
• Access to the company’s network infrastructure and server rooms
• Access to relevant documentation, such as information security policies, disaster recovery plans, and business continuity plans
• Access to the company’s IT staff and other relevant personnel
• Use of Computer Assisted Audit Techniques (CAATs) to facilitate the testing of controls and data analysis.

7. Methodology and Strategy adapted for execution of assignment

The audit of the online brokerage firm will be conducted in accordance with the International Standards for the Professional Practice of Internal Auditing (IIA Standards) and relevant industry-specific guidelines. The following methodology and strategy will be adapted for the execution of the assignment:
• Understand the business objectives and risks of the online brokerage firm and evaluate the adequacy of their risk management practices.
• Evaluate the effectiveness of the company’s internal controls related to online trading platform security, access controls, and change management.
• Test the effectiveness of the company’s business continuity and disaster recovery plans, including the ability to restore critical business processes and data in the event of a disruption.
• Review the company’s information security policies and practices to ensure they align with industry standards and regulations.
• Evaluate the company’s compliance with relevant laws, regulations, and guidelines governing the online brokerage industry.
• Review the adequacy of the company’s IT infrastructure and network security controls to prevent cyber attacks and unauthorized access.
• Conduct interviews with key personnel to gain a better understanding of the company’s operations and control environment.

8. Documents reviewed

During the audit of the online brokerage firm, the following documents will be reviewed:
• Online trading platform security policies and procedures
• Disaster recovery and business continuity plans
• Information security policies and procedures
• Access control policies and procedures
• IT infrastructure and network security policies and procedures
• Change management policies and procedures
• Compliance policies and procedures
• Audit findings and recommendations from previous audits.

9. References

The following references will be used in performing the audit of the online brokerage firm:
• International Standards for the Professional Practice of Internal Auditing (IIA Standards)
• Industry-specific guidelines and best practices, including the National Institute of Standards and Technology (NIST) Cybersecurity Framework and the Securities and Exchange Commission (SEC) rules and regulations.
• Company-specific policies and procedures.

10. Deliverables

The following deliverables will be provided as part of the audit of the online brokerage firm:
• Draft audit report
• Final audit report
• Executive summary of findings and recommendations
• Detailed findings and recommendations.

11. Format of Report/ Findings and Recommendations

The audit report and findings and recommendations will follow a standard format as required by the IIA Standards and industry-specific guidelines. The report will include an executive summary, background information, scope and methodology, key findings, and recommendations for improvement.

12. Summary/Conclusion

The audit of the online brokerage firm is important to ensure that the company’s online trading platform is secure and the firm can quickly recover from any business disruptions. The audit will help identify weaknesses in the company’s controls, policies, and procedures and make recommendations for improvement. The ultimate goal is to provide assurance that the company is managing risks effectively and complying with relevant regulations and guidelines.