Federal Information System Controls Audit Manual (FISCAM):
Exposure Draft (31-JUL-08, GAO-08-1029G).
This letter transmits the exposure draft of the Government
Accountability Office (GAO) Federal Information System Controls
Audit Manual (FISCAM) for review and comment. The FISCAM presents
a methodology for performing information system (IS) control
audits of federal and other governmental entities in accordance
with professional standards, and was originally issued in January
1999. We have updated the FISCAM for significant changes
affecting IS audits.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-08-1029G
ACCNO: A83163
TITLE: Federal Information System Controls Audit Manual
(FISCAM): Exposure Draft
DATE: 07/31/2008
SUBJECT: Auditing procedures
Auditing standards
Computer security
Data integrity
Federal agency accounting systems
Financial statement audits
Information management
Information security
Information security management
Information security regulations
Information systems
Information technology
Internal controls
Risk management
Software
Software verification and validation
Standards evaluation
Strategic planning
Systems analysis
Systems evaluation
Systems integration
Systems management
Systems monitoring
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GAO-08-1029G
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United States Government Accountability Office:
GAO:
July 2008:
Federal Information System Controls Audit Manual (FISCAM):
Exposure Draft:
GAO-08-1029G:
United States Government Accountability Office:
Washington, DC 20548:
July 2008:
To Audit Officials, Agency CIOs, And Others Interested In Federal
Information System Controls Auditing And Reporting:
This letter transmits the exposure draft of the Government
Accountability Office (GAO) Federal Information System
Controls Audit Manual (FISCAM) for your review and comment.
The FISCAM presents a methodology for performing information
system (IS) control[Footnote 1] audits of federal and other governmental
entities in accordance with professional standards, and was
originally issued in January 1999. We have updated the FISCAM
for significant changes affecting IS audits.
GAO would like to thank the President�s Council on Integrity and
Efficiency (PCIE) and the state auditor community for their
significant input into the development of this revised FISCAM.
Summary of Major Revisions to FISCAM:
The exposure draft revisions reflect changes in (1) technology
used by government entities, (2) audit guidance and control
criteria issued by the National Institute of Standards and
Technology (NIST), and (3) generally accepted government auditing
standards (GAGAS), as presented in Government Auditing Standards (also
known as the �Yellow Book�). [Footnote 2] The Federal Information
System Controls Audit Manual (FISCAM) provides a methodology for
performing information system (IS) control audits in accordance with
GAGAS. However, at the discretion of the auditor, this manual may be
applied on other than GAGAS audits. As defined in GAGAS, IS controls
consist of those internal controls that are dependent on information
systems processing and include general controls and application
controls. This manual focuses on evaluating the effectiveness of such
general and application controls. This manual is intended for both (1)
auditors to assist them in understanding the work done by IS controls
specialists, and (2) IS controls specialists to plan and perform the IS
controls audit.
In addition, the FISCAM is consistent with the GAO/PCIE Financial Audit
Manual (FAM). Also, the FISCAM control activities are consistent with
and have been mapped to the NIST Special Publication 800-53.
The FISCAM, which is consistent with NIST and other criteria, is
organized to facilitate effective and efficient IS control audits.
Specifically, the methodology in the FISCAM incorporates:
* Top-down, risk based approach that considers materiality and
significance in determining effective and efficient audit procedures.
* Evaluation of entitywide controls and their effect on audit risk.
* Evaluation of general controls and their pervasive impact on business
process application controls.
* Evaluation of security management at all levels (entitywide, system,
and business process application levels).
* A control hierarchy (control categories, critical elements, and
control activities) to assist in evaluating the significance of
identified IS control weaknesses.
* Groupings of control categories consistent with the nature of the
risk.
* Experience gained in GAO�s performance and review of IS control
audits, including field testing the concepts in this revised FISCAM.
As discussed above, this manual is organized in a hierarchical
structure to assist the auditor in performing the IS controls audit.
Chapter 3 (general controls) and Chapter 4 (business process
application level controls) contain several control categories, which
are groupings of related controls pertaining to similar types of risk.
For each control category, the manual identifies critical
elements�tasks that are essential for establishing adequate controls
within the category. For each critical element, there is a discussion
of the associated control activities that are generally necessary to
achieve the critical element, as well as related potential control
techniques and suggested audit procedures. This hierarchical structure
facilitates the auditor�s audit planning and the auditor�s analysis of
identified control weaknesses.
Because control activities are generally necessary to achieve the
critical elements, they are generally relevant to a GAGAS audit unless
the related control category is not relevant, the audit scope is
limited, or the auditor determines that, due to significant IS control
weaknesses, it is not necessary to assess the effectiveness of all
relevant IS controls. Within each relevant control activity, the
auditor should identify control techniques implemented by the entity
and determine whether the control techniques, as designed, are
sufficient to achieve the control activity, considering IS audit risk
and the audit objectives. The auditor may be able to determine whether
control techniques are sufficient to achieve a particular control
activity without evaluating and testing all of the control techniques.
Also, depending on IS audit risk and the audit objectives, the nature
and extent of control techniques necessary to achieve a particular
control objective will vary.
If sufficient, the auditor should determine whether the control
techniques are implemented (placed in operation) and are operating
effectively. Also, the auditor should evaluate the nature and extent of
testing performed by the entity. Such information can assist in
identifying key controls and in assessing risk, but the auditor should
not rely on testing performed by the entity in lieu of appropriate
auditor testing. If the control techniques implemented by the entity,
as designed, are not sufficient to address the control activity, or the
control techniques are not effectively implemented as designed, the
auditor should determine the effect on IS controls and the audit
objectives.
Throughout the updated FISCAM, revisions were made to reflect today�s
networked environment. The nature of IS risks continues to evolve.
Protecting government computer systems has never been more important
because of the complexity and interconnectivity of systems (including
Internet and wireless), the ease of obtaining and using hacking tools,
the steady advances in the sophistication and effectiveness of attack
technology, and the emergence of new and more destructive attacks.
In addition, the FISCAM includes narrative that is designed to provide
a basic understanding of the methodology (Chapter 2), general controls
(Chapter 3) and business process application controls (Chapter 4)
addressed by the FISCAM. The narrative may also be used as a reference
source by the auditor and the IS control specialist. More experienced
auditors and IS control specialists may find it unnecessary to
routinely refer to such narrative in performing IS control audits. For
example, a more experienced auditor may have sufficient knowledge,
skills, and abilities to directly use the control tables in Chapters 2
and 3 (which are summarized in Appendices II and III).
A summary of significant changes to FISCAM is presented on the
pages 6-10.
Instructions for Commenting on the Exposure Draft:
The exposure draft of FISCAM is available only in electronic form at
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?rptno=GAO-08-1029G] on
GAO�s Web page. We request comments from federal audit officials, CIOs,
financial managers, the public accounting profession, and other
interested parties. Please associate your comments with specific
references to section, paragraph, and page number. Also, please
provide the rationale for your comments and proposed changes,
along with suggested revised language. Please send your comments
electronically to [email protected] no later than September 5, 2008.
We anticipate that the final version of FISCAM will be issued in the
fall of 2008 for use in conducting fiscal year 2009 federal financial
statement audits.
Should you need additional information, please call Greg Wilshusen
at (202) 512-6244; David Irvin at (214) 777-5643; or me at (202) 512-
7439.
Sincerely yours,
Signed by:
Robert F. Dacey:
Chief Accountant:
U.S. Government Accountability Office:
Attachment and enclosures:
Summary Of Significant Changes To The FISCAM:
Chapter 1:
* Expanded purpose:
- provide guidance for performing effective and efficient Information
System (IS) controls audits, either alone or as part of a performance
audit, a financial audit, or an attestation engagement, including
communication of any identified IS control weaknesses; and;
- inform financial, performance, and attestation auditors about IS
controls and related audit issues, so that they can (1) plan their work
in accordance with Generally Accepted Government Auditing Standards
(GAGAS) and (2) integrate the work of IS controls specialists with
other aspects of the financial or performance audit or attestation
engagement.
* Conformity with July 2007 Revision to Government Auditing Standards �
(�Yellow Book�)(GAGAS), including information system control
categories.
* Conformity with AICPA auditing standards, including new risk
standards.
* An overall framework of IS control objectives (see summary on pages
11-13).
Chapter 2:
* IS audit methodology consistent with GAGAS and FAM, including
planning, testing, and reporting phases (see a summary of methodology
steps on pages 14-15), which incorporates:
- A top-down, risk-based evaluation that considers materiality and
significance in determining effective and efficient audit procedures
(the auditor determines which IS control techniques are relevant to the
audit objectives and which are necessary to achieve the control
activities; generally, all control activities are relevant unless the
audit scope is limited or the auditor determines that, due to
significant IS control weaknesses, it is not necessary to test all
relevant IS controls).
- An evaluation of entitywide IS controls and their effect on audit
risk, and therefore on the extent of audit testing (effective
entitywide IS controls can reduce audit risk, while ineffective
entitywide IS controls result in increased audit risk and generally are
a contributory cause of IS control weaknesses at the system and
business process application levels)�NIST SP 800-53 principally relates
to controls at the system and application level.
- An evaluation of general controls and their pervasive impact on
business process application controls (effective general controls
support the effectiveness of business process application controls,
while ineffective general controls generally render business process
application controls ineffective).
- An evaluation of security management at all levels of control --
entitywide, system (includes networks, operating systems, and
infrastructure applications), and business process application levels.
- A control hierarchy (control categories, critical elements, and
control activities) to assist in evaluating the significance of
identified IS control weaknesses (if a critical element is not
achieved, the respective control category is not likely to be achieved;
if one of the nine control categories are not effectively achieved, IS
controls are ineffective, unless other factors sufficiently reduce the
risk).
- Groupings of control categories consistent with the nature of the
risk.
* Change from �installation level� general controls to �system level�
general controls to reflect the logically networked structure of
today�s systems
* IS controls audit documentation guidance for each audit phase ??
Additional audit considerations that may affect an IS audit, including:
- information security risk factors;
- automated audit tools;
- sampling techniques.
Chapter 3:
* Reorganized general control categories, consistent with GAGAS:
- Security management;
- broadened to consider statutory requirements and best practices;
- Access controls - restructured to incorporate system software,
eliminate redundancies, and facilitate IS auditing in a networked
environment:
System boundaries;
Identification and authentication;
User authorization;
Sensitive system resources;
Audit and monitoring;
Physical security.
- Configuration management - broadened to include network components
and applications;
- Segregation of Duties - relatively unchanged;
- Contingency Planning - updated for new terminology.
* Updated general control activities that (1) are consistent with
current NIST and OMB information security guidance (particularly NIST
Special Publication 800-53) including references/mapping of each
critical element to such guidance, and (2) consider new IS risks and
audit experience.
Chapter 4:
* Audit methodology and IS controls for business process applications
that (1) are consistent with GAGAS and current NIST and OMB information
security guidance (particularly NIST Special Publication 800-53)
including references/mapping to such guidance, and (2) consider new IS
risks and audit experience:
- Application security (formerly general controls at the application
level);
- Business process controls related to the validity, completeness,
accuracy, and confidentiality of transactions and data during
application processing:
Transaction data input;
Transaction data processing;
Transaction data output;
Master file data setup and maintenance;
* Interface controls;
* Data management systems controls.
Appendices:
* Expanded appendices to support IS audits;
- Updated information system controls audit planning checklist;
- Tables for summarizing the results of the IS audit;
- Mapping of FISCAM to NIST Special Publication 800-53;
- Knowledge, skills, and abilities needed to perform IS audits;
- Scope of an IS audit in support of a financial audit;
- Entity�s use of service organizations;
- Application of FISCAM to Single Audits;
- Application of FISCAM to FISMA;
- Complete FISMA text;
- Information System Controls Audit Documentation;
- Updated Glossary.
[End of section]
Information System Controls Objectives:
General Controls:
Security Management:
Controls provide reasonable assurance that security management is
effective, including effective:
* security management program;
* periodic assessments and validation of risk;
* security control policies and procedures;
* security awareness training and other security-related personnel
issues;
* periodic testing and evaluation of the effectiveness of information
security policies, procedures, and practices;
* remediation of information security weaknesses, and;
* security over activities performed by external third parties.
Access Controls:
Controls provide reasonable assurance that access to computer resources
(data, equipment, and facilities) is reasonable and restricted to
authorized individuals, including effective:
* protection of information system boundaries;
* identification and authentication mechanisms;
* authorization controls;
* protection of sensitive system resources;
* audit and monitoring capability, including incident handling, and;
* physical security controls.
Configuration Management:
Controls provide reasonable assurance that changes to information
system resources are authorized and systems are configured and operated
securely and as intended, including effective:
* configuration management policies, plans, and procedures;
* current configuration identification information;
* proper authorization, testing, approval, and tracking of all
configuration changes;
* routine monitoring of the configuration;
* updating software on a timely basis to protect against known
vulnerabilities, and;
* documentation and approval of emergency changes to the configuration.
Segregation of Duties:
Controls provide reasonable assurance that incompatible duties are
effectively segregated, including effective:
* segregation of incompatible duties and responsibilities and related
policies, and;
* control of personnel activities through formal operating procedures,
supervision, and review.
Contingency Planning:
Controls provide reasonable assurance that contingency planning (1)
protects information resources and minimizes the risk of unplanned
interruptions and (2) provides for recovery of critical operations
should interruptions occur, including effective:
* assessment of the criticality and sensitivity of computerized
operations and identification of supporting resources;
* steps taken to prevent and minimize potential damage and
interruption;
* comprehensive contingency plan, and;
* periodic testing of the contingency plan, with appropriate
adjustments to the plan based on the testing.
[End of section]
Business Process Application Controls:
Completeness � controls provide reasonable assurance that all
transactions that occurred are input into the system, accepted for
processing, processed once and only once by the system, and properly
included in output.
Accuracy � controls provide reasonable assurance that transactions are
properly recorded, with correct amount/data, and on a timely basis (in
the proper period); key data elements input for transactions are
accurate; data elements are processed accurately by applications that
produce reliable results; and output is accurate.
Validity � controls provide reasonable assurance (1) that all recorded
transactions and actually occurred (are real), relate to the
organization, are authentic, and were properly approved in accordance
with management�s authorization; and (2) that output contains only
valid data.
Confidentiality � controls provide reasonable assurance that
application data and reports and other output are protected against
unauthorized access.
[End of section]
IS Audit Methodology Steps:
Plan the Information System Controls Audit:
* Understand the Overall Audit Objectives and Related Scope of the
Information System Controls Audit.
* Understand the Entity�s Operations and Key Business Processes.
* Obtain a General Understanding of the Structure of the Entity�s
Networks.
* Identify Key Areas of Audit Interest.
* Assess Information System Risk on a Preliminary Basis.
* Identify Critical Control Points.
* Obtain a Preliminary Understanding of Information System Controls.
* Perform Other Audit Planning Procedures;
- Relevant Laws and Regulations;
- Consideration of the Risk of Fraud;
- Audit Resources;
- Multiyear Testing Plans;
- Communication with Entity Management and Those Charged with
Governance;
- Service Organizations;
- Using the Work of Others;
- Audit Plan.
Perform Information System Controls Audit Tests:
* Understand Information Systems Relevant to the Audit Objectives.
* Determine which IS Control Techniques are Relevant to the Audit
Objectives.
* For each Relevant IS Control Technique Determine Whether it is
Suitably Designed to Achieve the Critical Activity and has been
Implemented.
* Perform Tests to Determine Whether such Control Techniques are
Operating Effectively.
* Identify Potential Weaknesses in IS Controls and Consider
Compensating Controls.
Report Audit Results:
* Evaluate the Effects of Identified IS Control Weaknesses:
- Financial Audits, Attestation Engagements, and Performance Audits.
* Consider Other Audit Reporting Requirements and Related Reporting
Responsibilities.
[End of section]
Exposure Draft Contents:
Chapter 1:
Introduction:
1.0 Chapter 1 Overview:
1.1 Purpose and Anticipated Users of the Manual:
1.2 Nature of Information System Controls:
1.3 Determining the Nature and Extent of Audit Procedures:
1.4 Organization of This Manual:
1.4.1 Appendices:
Chapter 2. Performing the Information System Controls Audit:
2.0 Introduction:
2.1 Planning the Information System Controls Audit:
2.1.1 Overview:
2.1.2 Understand the Overall Audit Objectives and Related Scope of the
Information System Controls:
2.1.3 Understand the Entity�s Operations and Key Business Processes:
2.1.4 Obtain a General Understanding of the Structure of the Entity�s
Networks:
2.1.5 Identify Key Areas of Audit Interest:
2.1.6 Assess Information System Risk on a Preliminary Basis:
2.1.7 Identify Critical Control Points:
2.1.8 Obtain a Preliminary Understanding of Information System
Controls:
2.1.9 Perform Other Audit Planning Procedures:
2.1.9.A Relevant Laws and Regulations:
2.1.9.B Consideration of the Risk of Fraud:
2.1.9.C Audit Resources:
2.1.9.D Multiyear Testing Plans:
2.1.9.E Communication with Entity Management and Those Charged with
Governance:
2.1.9.F Service Organizations:
2.1.9.G Using the Work of Others:
2.1.9.H Audit Plan:
2.1.10 Documentation of Planning Phase:
2.2 Perform Information System Controls Audit Tests:
2.2.1 Overview:
2.2.2 Appropriateness of Control Tests:
2.2.3 Documentation of Control Testing Phase:
2.3 Report Audit Results:
2.3.1 Financial Audits and Attestation Engagements:
2.3.2 Performance Audits:
2.3.3 Other Audit Reporting Considerations:
2.3.4 Related Reporting Responsibilities:
2.3.5 Documentation of Reporting Phase:
2.4 Documentation:
2.5 Other Information System Controls Audit Considerations:
2.5.1 Additional IS Risk Factors:
2.5.1.A Defense-In-Depth Strategy:
2.5.1.B Web Applications:
2.5.1.C ERP Systems:
2.5.1.D Interface Controls:
2.5.1.E Database Management Systems:
2.5.1.F Network-based Access Control Systems:
2.5.1.G Workstations:
35 2.5.2 Automated Audit Tools:
2.5.3 Use of Sampling Techniques:
Chapter 3. Evaluating and Testing General Controls:
3.0 Introduction:
3.1. Security Management (SM):
Security Program Guidance:
Security Management Critical Elements:
Critical Element SM-1: Establish a Security Management Program:
SM-1.1. The security management program is adequately documented,
approved, and up-to-date:
SM-1.2. A security management structure has been established:
SM-1.3. Information security responsibilities are clearly assigned:
SM-1.4. Subordinate security plans are documented, approved, and kept
up-to-date:
SM-1.5. An inventory of systems is developed, documented, and kept up-
to-date:
Control Techniques and Suggested Audit Procedures for Critical Element
SM-1:
Critical Element SM-2. Periodically assess and validate risks:
Control Techniques and Suggested Audit Procedures for Critical Element
SM-2:
Critical Element SM-3. Document security control policies and
procedures:
Control Techniques and Suggested Audit Procedures for Critical Element
SM-3:
Critical Element SM-4. Implement effective security awareness and other
security-related personnel policies:
SM-4.1 Ensure that resource owners, system administrators, and users
are aware of security policies:
SM-4.2. Hiring, transfer, termination, and performance policies address
security:
SM-4.3. Employees have adequate training and expertise:
Control Techniques and Suggested Audit Procedures for Critical Element
SM-4:
Critical Element SM-5. Monitor the effectiveness of the security
program:
Control Techniques and Suggested Audit Procedures for Critical Element
SM-5:
Critical Element SM-6. Effectively Remediate Information Security
Weaknesses:
Control Techniques and Suggested Audit Procedures for Critical Element
SM-6:
Critical Element SM-7. Ensure that activities performed by external
third parties are adequately secure:
Control Techniques and Suggested Audit Procedures for Critical Element
SM-7:
3.2. Access Controls (AC):
Critical Element AC-1. Adequately protect information system
boundaries:
AC-1.1. Appropriately control connectivity to system resources:
AC-1.2. Appropriately control network sessions:
Control Techniques and Suggested Audit Procedures for Critical Element
AC-1:
Critical Element AC-2. Implement effective identification and
authentication mechanisms:
AC-2.1. Users are appropriately identified and authenticated:
Control Techniques and Suggested Audit Procedures for Critical Element
AC-2:
Critical Element AC-3. Implement effective authorization controls:
AC-3.1. User accounts are appropriately controlled:
AC-3.2. Processes and services are adequately controlled:
Critical Element AC-4. Adequately protect sensitive system resources:
AC-4.1. Access to sensitive system resources is restricted and
monitored:
AC-4.2. Adequate media controls have been implemented:
AC-4.3. Cryptographic controls are effectively used:
Control Techniques and Suggested Audit Procedures for Critical Element
AC-4:
Critical Element AC-5. Implement an effective audit and monitoring
capability:
AC-5.1. An effective incident response program is documented and
approved:
AC-5.2. Incidents are effectively identified and logged:
AC-5.3. Incidents are properly analyzed and appropriate actions taken:
Control Techniques and Suggested Audit Procedures for Critical Element
AC-5:
Critical Element AC-6. Establish adequate physical security controls:
AC-6.1. Establish a physical security management program based on risk:
AC-6.2. Establish adequate perimeter security based on risk:
AC-6.3. Establish adequate security at entrances and exits based on
risk:
AC-6.4. Establish adequate interior security based on risk:
AC-6.5. Adequately protect against emerging threats based on risk:
Control Techniques and Suggested Audit Procedures for Critical Element
AC-6:
3.3. Configuration Management (CM):
Critical Element CM-1. Develop and document CM policies, plans, and
procedures:
Control Techniques and Suggested Audit Procedures for Critical Element
CM-1:
Critical Element CM-2. Maintain current configuration identification
information:
Control Techniques and Suggested Audit Procedures for Critical Element
CM-2:
Critical Element CM-3. Properly authorize, test, approve, track, and
control all configuration changes:
Control Techniques and Suggested Audit Procedures for Critical Element
CM-3:
Critical Element CM-4. Routinely monitor the configuration:
Control Techniques and Suggested Audit Procedures for Critical Element
CM-4:
Critical Element CM-5. Update software on a timely basis to protect
against known vulnerabilities:
Vulnerability scanning:
Patch management:
Virus protection:
Emerging threats:
Noncurrent software:
Software usage:
Control Techniques and Suggested Audit Procedures for Critical Element
CM-5:
Critical Element CM-6. Appropriately document and approve emergency
changes to the configuration:
Control Techniques and Suggested Audit Procedures for Critical Element
CM-6:
3.4. Segregation of Duties (SD):
Critical Element SD-1. Segregate incompatible duties and establish
related policies:
SD-1.1. Incompatible duties have been identified and policies
implemented to segregate these duties:
SD-1.2. Job descriptions have been documented:
SD-1.3. Employees understand their duties and responsibilities:
Control Techniques and Suggested Audit Procedures for Critical Element
SD-1:
Critical Element SD-2. Control personnel activities through formal
operating procedures, supervision, and review:
SD-2.1. Formal procedures guide personnel in performing their duties:
SD-2.2. Active supervision and review are provided for all personnel:
Control Techniques and Suggested Audit Procedures for Critical Element
SD-2:
3.5. Contingency Planning (CP):
Critical Element CP-1. Assess the criticality and sensitivity of
computerized operations and identify supporting resources:
CP-1.1. Critical data and operations are identified and prioritized:
CP-1.2. Resources supporting critical operations are identified and
analyzed:
CP-1.3. Emergency processing priorities are established:
Control Techniques and Suggested Audit Procedures for Critical Element
CP-1:
Critical Element CP-2. Take steps to prevent and minimize potential
damage and interruption:
CP-2.1. Data and program backup procedures have been implemented:
CP-2.2. Adequate environmental controls have been implemented:
CP-2.3. Staff have been trained to respond to emergencies:
CP-2.4. Effective hardware maintenance, problem management, and change
management help prevent unexpected interruptions:
Control Techniques and Suggested Audit Procedures for Critical Element
CP-2:
Critical Element CP-3. Develop and document a comprehensive contingency
plan:
CP-3.1. An up-to-date contingency plan is documented:
CP-3.2. Arrangements have been made for alternate data processing,
storage, and telecommunications facilities:
Control Techniques and Suggested Audit Procedures for Critical Element
CP-3:
Critical Element CP-4. Periodically test the contingency plan and
adjust it as appropriate:
CP-4.1. The plan is periodically tested:
CP-4.2. Test results are analyzed and the contingency plan is adjusted
accordingly:
Control Techniques and Suggested Audit Procedures for Critical Element
CP-4:
Chapter 4. Evaluating and Testing Business Process Application
Controls:
4.0 Overview:
4.0.1 The Auditor�s Consideration of Business Process Control
Objectives:
4.0.2 Steps in Assessing Business Process Application Level Controls:
4.0.3 Plan the Information System Controls Audit of Business Process
Application Level Controls:
4.0.3.A Understand the overall audit objectives and related scope of
the business process application control assessment:
4.0.3.B Understand the entity�s operations and key business processes:
4.0.3.C Obtain a general understanding of the structure of the entity�s
networks:
4.0.3.D Identify key areas of audit interest (files, applications,
systems, locations):
4.0.3.E Assess information system risk on a preliminary basis:
4.0.3.F Identify critical control points:
4.0.3.G Obtain a preliminary understanding of application controls:
4.0.3.H Perform other audit planning procedures:
4.0.4 Perform Information System Controls Audit Tests of Business
Process Application Level Controls:
4.0.5 Report Audit Results:
4.1. Application Level General Controls (AS):
Critical Element AS-1. Implement effective application security
management:
Establish an application security plan:
Periodically assess and validate application security risks:
Document and implement application security policies and procedures:
Implement effective security awareness and other security-related
personnel policies:
Monitor the effectiveness of the security program:
Effectively remediate information security weaknesses:
Implement effective security-related personnel policies:
Adequately secure, document, and monitor external third party
activities:
Critical Element AS-2. Implement effective application access controls:
Adequately protect application boundaries: Implement effective
identification and authentication mechanisms:
Implement effective authorization controls:
Adequately protect sensitive application resources:
Implement an effective audit and monitoring capability:
Establish adequate physical security controls:
Critical Element AS-3 � Implement effective application configuration
management:
Critical Element � AS-4: Segregate user access to conflicting
transactions and activities and monitor segregation:
Critical Element � AS-5: Implement effective application contingency
planning:
Assess the criticality and sensitivity of the application:
Take steps to prevent and minimize potential damage and interruption:
Develop and document an application contingency plan:
5 Periodically test the contingency plan and adjust it as appropriate:
4.2. Business Process Controls (BP):
Master Data vs. Transaction Data:
Business Process Control Objectives:
NIST Guidance:
Business Process Control Critical Elements:
BP-1 Transaction Data Input is complete, accurate, valid, and
confidential (Transaction Data Input Controls):
Implement an effective transaction data strategy and design:
Establish Input Preparation (approval and review) Policies and
Procedures:
Build Data Validation and Edits within the Application:
Implement Effective Auditing and Monitoring Capability:
BP-2 Transaction Data Processing is complete, accurate, valid, and
confidential (Transaction Data Processing Controls):
Formal Transaction Processing Procedures:
Effective auditing and monitoring capability:
BP-3 Transaction data output is complete, accurate, valid, and
confidential (Transaction Data Output Controls):
Implementing a reporting strategy:
Establishing security and controls over report generation and
distribution:
BP-4 Master Data Setup and Maintenance is Adequately Controlled:
Implementing an effective design of master data elements:
Establishing master data maintenance procedures, including approval,
review, and adequate support for changes to master data:
Implementing an effective auditing and monitoring capability:
4.3. Interface Controls (IN):
Critical Element IN-1: Implement an effective interface strategy and
design:
Critical Element IN-2: Implement effective interface processing
procedures:
4.4 Data Management System Controls (DA):
Key Concepts - Database Management Systems:
Authentication/Authorization:
SQL Commands:
System, Role, Object Privileges:
Stored Procedures:
Key Concepts � Middleware:
Middleware Controls:
Key Concepts � Cryptography:
Key Concepts � Data Warehouse, Data Reporting and Data Extraction
Software:
Segregation of Duties:
Control Activities:
Appendices:
Appendix I - Information System Controls Audit Planning Checklist:
Appendix II - Tables for Summarizing Work Performed in Evaluating and
Testing General and Business Process Application Controls:
Appendix III - Tables for Assessing the Effectiveness of General and
Business Process Application Controls:
Appendix IV - Mapping of FISCAM to SP 800-5:
Appendix V - Knowledge, Skills, and Abilities Needed to Perform
Information System Controls Audits:
Appendix VI - Scope of an Information System Controls Audit in Support
of a Financial Audit:
Appendix VII - Entity�s Use of Service Organizations:
Appendix VIII - Application of FISCAM to Single Audits:
Appendix IX - Application of FISCAM to FISMA:
Appendix X - Federal Information Security Management Act of 2002
(FISMA):
Appendix XI - Information System Controls Audit Documentation:
Appendix XII - Glossary:
Appendix XIII � Bibliography:
Figures:
Figure 1. An Example of Typical Networked Systems:
Figure 2: Example of Router Control Dependencies:
Figure 3. Example of Network Schematic Describing System Weaknesses:
Figure 4. Layered Approach to Network Security:
Figure 5. Layered Security Mitigates the Risk of Individual
Cybersecurity Threats:
Figure 6: Steps in Assessing IT Systems Controls in a Financial
Statement Audit:
Figure 7: Steps for Each Significant Application in Assessing
Information System Controls in a Financial Statement Audit:
Tables:
Table 1: Control Categories Applicable at Different Levels of Audit:
Table 2. General Control Categories Applicable at Different Levels of
Audit:
Table 3. Critical Elements for Security Management:
Table 4. Security Controls to Include in System Security Plans:
Table 5. Control Techniques and Suggested Audit Procedures for Critical
Element SM-1: Establish a security management program:
Table 6. NIST Impact Definitions for Security Objectives:
Table 7 Control Techniques and Suggested Audit Procedures for Critical
Element SM-2: Periodically assess and validate risks:
Table 8. Control Techniques and Suggested Audit Procedures for Critical
Element SM-3: Document security control policies and procedures:
Table 9. Control Techniques and Suggested Audit Procedures for Critical
Element SM-4: Implement effective security awareness and other security-
related personnel policies:
Table 10. Types of Security Testing:
Table 11. Control Techniques and Suggested Audit Procedures for
Critical Element SM-5: Monitor the effectiveness of the security
program:
Table 12. Control Techniques and Suggested Audit Procedures for
Critical Element SM-6: Effectively remediate information security
weaknesses:
Table 13. Examples of Agency-Identified Risks to Federal Systems and
Data Resulting from Reliance on Contractors:
Table 14. Control Techniques and Suggested Audit Procedures for
Critical Element SM-7: Ensure that activities performed by external
third parties are adequately secure:
Table 15. Critical Elements for Access Control:
Table 16. Control Techniques and Suggested Audit Procedures for
Critical Element AC-1: Adequately protect information system
boundaries:
Table 17. Control Techniques and Suggested Audit Procedures for
Critical Element AC-2: Implement effective identification and
authentication mechanisms:
Table 18. Control Techniques and Suggested Audit Procedures for
Critical Element AC-3: Implement effective authorization controls:
Table 19. Control Techniques and Suggested Audit Procedures for
Critical Element AC-4: Adequately protect sensitive system resources:
Table 20. Control Techniques and Suggested Audit Procedures for
Critical Element AC-5: Implement an effective audit and monitoring
capability:
Table 21. Control Techniques and Suggested Audit Procedures for
Critical Element AC-6: Establish adequate physical security controls:
Table 22. Critical Elements for Configuration Management:
Table 23. Control Techniques and Suggested Audit Procedures for
Critical Element CM-1: Develop and document CM policies, plans, and
procedures:
Table 24. Control Techniques and Suggested Audit Procedures for
Critical Element CM-2: Maintain current configuration identification
information:
Table 25. Control Techniques and Suggested Audit Procedures for
Critical Element CM-3: Properly authorize, test, approve, and track all
configuration:
Table 26. Control Techniques and Suggested Audit Procedures for
Critical Element CM-4: Routinely monitor the configuration:
Table 27. Control Techniques and Suggested Audit Procedures for
Critical Element CM-5: Update software on a timely basis to protect
against known vulnerabilities:
Table 28. Control Techniques and Suggested Audit Procedures for
Critical Element CM-6: Appropriately document and approve emergency
changes to the configuration:
Table 29. Critical Elements for Segregation of Duties:
Table 30. Control Techniques and Suggested Audit Procedures for
Critical Element SD-1: Segregate incompatible duties and establish
related policies:
Table 31. Control Techniques and Suggested Audit Procedures for
Critical Element SD-2: Control personnel activities through formal
operating procedures, supervision, and review:
Table 32. Critical Elements for Contingency Planning:
Table 33. Control Techniques and Suggested Audit Procedures for
Critical Element CP-1: Assess the criticality and sensitivity of
computerized operations and identify supporting resources:
Table 34. Control Techniques and Suggested Audit Procedures for
Critical Element CP-2: Take steps to prevent and minimize potential
damage and interruption:
Table 35: Types of Contingency-Related Plans:
Table 36. Control Techniques and Suggested Audit Procedures for
Critical Element CP-3: Develop and document a comprehensive contingency
plan:
Table 37. Control Techniques and Suggested Audit Procedures for
Critical Element CP-4: Periodically test the contingency plan and
adjust it as appropriate:
Table 38. General and Application Control Categories Applicable at
Different Levels of Audit:
Table 39. Control Techniques and Suggested Audit Procedures for
Critical Element AS-1: Implement effective application security
management:
Table 40. Control Techniques and Suggested Audit Procedures for
Critical Element AS-2: Implement effective application access controls:
Table 41. Control Techniques and suggested audit procedures for AS-3 -
Implement Effective Application Configuration Management:
Table 42. Control Techniques and Suggested Audit Procedures For
Critical Element AS-4 - Segregate user access to conflicting
transactions and activities and monitor segregation.:
Table 43. Control Techniques And Suggested Audit Procedures For
Critical Element AS-5 � Maintain an effective contingency planning
program:
Table 44. Control Techniques And Suggested Audit Procedures For
Critical Element BP-1 - Transaction Data Input is complete, accurate,
valid, and confidential:
Table 45. Control Techniques And Suggested Audit Procedures For
Critical Element BP-2 Transaction Data Processing is complete,
accurate, valid, and confidential:
Table 46. Control Techniques And Suggested Audit Procedures For
Critical Element BP-3 Transaction data output is complete, accurate,
valid, and confidential:
Table 47. Control Techniques And Suggested Audit Procedures For
Critical Element BP-4 Master Data Setup and Maintenance is Adequately
Controlled:
Table 48. Control Techniques and Suggested Audit Procedures for
Critical Element IN-1: Implement an effective interface strategy and
design:
Table 49. Control Techniques And Suggested Audit Procedures For
Critical Element Critical Element Critical Element IN-2: Implement
effective interface processing procedures:
Table 50. Control Techniques and Suggested Audit Procedures for
Critical Element DA-1 - Implement an effective data management system
strategy and design:
[End of section]
Chapter 1. Introduction:
1.0 Chapter 1 Overview:
This manual provides a methodology for performing information system
(IS) control audits in accordance with �generally accepted government
auditing standards� (GAGAS), as presented in Government Auditing
Standards (also known as the �Yellow Book�).[Footnote 3] However, at
the discretion of the auditor, this manual may be applied on other than
GAGAS audits. As defined in GAGAS, IS controls consist of those
internal controls that are dependent on information systems processing
and include general controls and application controls. This manual
focuses on such general and application controls.
As computer technology has advanced, federal agencies and other
government entities have become dependent on computerized information
systems to carry out their operations and to process, maintain, and
report essential information. Virtually all federal operations are
supported by automated systems and electronic data, and agencies would
find it difficult, if not impossible, to carry out their missions and
account for their resources without these information assets. Hence,
ineffective IS controls can result in significant risk to a broad array
of government operations and assets. For example:
* resources, such as payments and collections, could be lost or stolen;
* computer resources could be used for unauthorized purposes, including
the launching of attacks on others;
* sensitive information, such as taxpayer data, Social Security
records, medical records, other personally identifiable information,
and proprietary business information, could be inappropriately added,
deleted, read, copied, disclosed, or modified for purposes such as
espionage, identity theft, or other types of crime;
* critical operations, such as those supporting national defense and
emergency services, could be disrupted;
* data could be modified or destroyed for purposes of fraud or
disruption; and;
* agency/entity missions could be undermined by embarrassing incidents
that result in diminished confidence in an agency�s ability to conduct
operations and fulfill its responsibilities.
The nature of IS risks continues to evolve. Protecting government
computer systems has never been more important because of the
complexity and interconnectivity of systems (including Internet and
wireless), the ease of obtaining and using hacking tools, the steady
advances in the sophistication and effectiveness of attack technology,
and the emergence of new and more destructive attacks.
As a result, the reliability of computerized data and of the systems
that process, maintain, and report these data is a major concern to
managements of government entities and their auditors. Auditors may
need to evaluate the effectiveness of information system controls over
data supporting financial statements or data used to analyze specific
program costs and outcomes. In addition, auditors may be called on to
evaluate the effectiveness of IS controls to help reduce the risk due
to errors, fraud, and other illegal acts and disasters or other
incidents that cause the systems to be unavailable.
Figure 1 illustrates the potential complexity of a typical networked
infrastructure. Such infrastructures are built upon multiple hosts,
including desktop personal computers (PCs), servers, and mainframes.
Data communications links and network devices such as routers, hubs,
and switches enable the hosts to communicate with one another through
local area networks (LANs) within entities. Wide area networks (WANs)
connect LANs at different geographical locations. Moreover, entities
are typically connected to the Internet.
Figure 1. An Example of Typical Networked Systems:
[See PDF for image]
This figure illustrates an example of typical networked systems.
Included in the networked systems are the following components:
General public;
Remote users;
Business partners;
Internet;
External routers;
Intrusion detection system;
External switch;
Firewall;
Public access servers;
VPN concentrator;
Dial-in access server;
Internal router and switch;
Wireless access point;
Local Area Networks (desktop PCs, printers, internal servers);
Gateway;
Mainframe;
Routers;
Wide Area Network;
Interorganization;
Intraorganization.
Source: GAO analysis and Microsoft Vision (TM).
[End of figure]
1.1 Purpose and Anticipated Users of the Manual:
This manual describes (1) an audit methodology for assessing the
effectiveness of IS controls, and (2) the IS controls that auditors
evaluate when assessing the confidentiality, integrity, and
availability of information and information systems. The Federal
Information System Controls Audit Manual (FISCAM) is designed to be
used primarily on financial and performance audits and attestation
engagements performed in accordance with �generally accepted government
auditing standards� (GAGAS), as presented in Government Auditing
Standards (also known as the �Yellow Book�). However, at the discretion
of the auditor, this manual may be applied on other than GAGAS audits.
This manual is intended for both (1) auditors performing financial and
performance audits and attestation engagements to assist them in
understanding the work done by IS controls specialists, and (2) IS
controls specialists to plan and perform the IS controls audit. Federal
and other government auditors may use this manual. It is not an
auditing standard and it would be incorrect to refer to it as a
standard. Its purposes are to:
* provide guidance for performing effective and efficient IS controls
audits, either alone or as part of a performance audit, a financial
audit, or an attestation engagement, including communication of any
identified IS control weaknesses; and;
* inform financial, performance, and attestation auditors about IS
controls and related audit issues, so that they can (1) plan their work
in accordance with GAGAS and (2) integrate the work of IS controls
specialists with other aspects of the financial or performance audit or
attestation engagement.
The auditor should determine whether IS controls are relevant to the
audit objectives. IS controls generally are relevant to a financial
audit, as financial information is usually processed by information
systems. For financial audits, the GAO/PCIE Financial Audit Manual
(FAM)[Footnote 4] provides a framework for evaluating IS controls as
part of a financial audit. The scope of an information system controls
audit in support of a financial audit is summarized in Appendix VI. For
performance audits, GAGAS 7.27 states that auditors should determine
which audit procedures related to information system controls are
needed to obtain sufficient, appropriate evidence to support the audit
findings and conclusions.[Footnote 5] This GAGAS paragraph provides
factors that may assist auditors in making this determination.
This manual lists specific control activities and techniques and
related suggested audit procedures. These are described at a high level
and assume some level of expertise for an auditor to perform these
audit procedures effectively. Accordingly, the auditor should develop
more detailed audit steps based on the specific software and control
techniques employed by the entity, the audit objectives, and
significant areas of audit interest.
In addition, the FISCAM includes narrative that is designed to provide
a basic understanding of the methodology (Chapter 2), general controls
(Chapter 3) and business process application controls (Chapter 4)
addressed by the FISCAM. The narrative may also be used as a reference
source by the auditor and the IS control specialist. More experienced
auditors and IS control specialists may find it unnecessary to
routinely refer to such narrative in performing IS control audits. For
example, a more experienced auditor may have sufficient knowledge,
skills, and abilities to directly use the control tables in Chapters 2
and 3 (which are summarized in Appendices II and III).
Further, many of the suggested audit procedures start with the word
�review.� The intent of such language is for the auditor to do more
than simply look at the subject to be reviewed. Rather, a critical
evaluation is envisioned, in which the auditor uses professional
judgment and experience and undertakes the task with a certain level of
skepticism, critical thinking, and creativity.
Although IS controls audit work, especially control testing, is
generally performed by an IS controls specialist, financial or
performance auditors with appropriate training, expertise, and
supervision may undertake specific tasks in this area of the audit.
Throughout this manual, the term �auditor� means either (1) an IS
controls specialist or (2) a financial or performance auditor working
in consultation with or under the supervision of an IS controls
specialist. The FISCAM may be used by other staff that possess adequate
IT competence. GAGAS requires that staff assigned to conduct an audit
must collectively possess the technical knowledge, skills, and
experience necessary to be competent for the type of work being
performed. See Appendix V for additional information on the knowledge,
skills, and abilities needed to perform information system control
audits.
The following terms are used in the FISCAM to describe the degree of
responsibility they impose on auditors and audit organizations:
* must - Auditors and audit organizations are required to comply with
this unconditional requirement in all cases in which the circumstances
exist to which the unconditional requirement applies. The term �must�
is used only in FISCAM when the related requirement is specified as a
�must� in GAGAS.
* should - Auditors and audit organizations are also required to comply
with this presumptively mandatory requirement in all cases in which the
circumstances exist to which the presumptively mandatory requirement
applies; however, in rare circumstances, auditors and audit
organizations may depart from a presumptively mandatory requirement
provided they document their justification for the departure and how
the alternative procedures performed in the circumstances were
sufficient to achieve the objectives of the presumptively mandatory
requirement. The term �should� is used when (1) the related requirement
is specified as a �should� in GAGAS, or (2) performance is deemed
necessary to meet GAGAS evidence requirements for an IS controls audit.
* generally should � Although optional, compliance with this policy is
strongly encouraged.
* may � Compliance with this procedure or action is optional. It is
descriptive rather than required. It is explanatory material that
provides further explanation and guidance on the professional
requirements or identifies and describes other procedures or actions
relating to auditors� or audit organizations� activities.
When these or similar terms are used to describe management or entity
actions (rather than actions of the auditor or audit organization), the
general meaning of the terms is intended. If the entity does not comply
with a �must� or �should�, the auditor should assess the impact of the
noncompliance on the effectiveness of related IS controls.
1.2 Nature of Information System Controls:
An evaluation of IS controls generally includes both general and
business process application controls (also called application
controls). The entity must have effective general and business process
application controls to achieve the appropriate confidentiality,
integrity, and availability of critical information and information
systems.
Information system (IS) controls consist of those internal controls
that are dependent on information systems processing and include
general controls (entitywide, system, and business process application
levels), business process application controls (input, processing,
output, master file, interface, and data management system controls),
and user controls[Footnote 6] (controls performed by people interacting
with information systems). General and business process application
controls are always IS controls. A user control is an IS control if its
effectiveness depends on information systems processing or the
reliability (accuracy, completeness, and validity) of information
processed by information systems. Conversely, a user control is not an
IS control if its effectiveness does not depend on information systems
processing or the reliability of information processed by information
systems.
General controls are the policies and procedures that apply to all or a
large segment of an entity�s information systems and help ensure their
proper operation. Examples of primary objectives for general controls
are to safeguard data, protect business process application programs,
and ensure continued computer operations in case of unexpected
interruptions. General controls are applied at the entitywide, system,
and business process application levels. The effectiveness of general
controls is a significant factor in determining the effectiveness of
business process application controls, which are applied at the
business process application level. Without effective general controls,
business process application controls can generally be rendered
ineffective by circumvention or modification. For example, automated
edits designed to preclude users from entering unreasonably large
dollar amounts in a payment processing system can be an effective
application control. However, this control is not effective (cannot be
relied on) if the general controls permit unauthorized program
modifications that might allow some payments to be exempted from the
edits or unauthorized changes to be made to data files after the edit
is performed. GAGAS paragraph 7.23 discusses the following types of
general controls: security management, logical and physical access,
configuration management, segregation of duties, and contingency
planning. Chapter 3 discusses the general controls in an IS controls
audit and provides more detail on the critical elements of each type of
general control.
Business process application controls are directly related to
individual computerized applications. They help ensure that
transactions are complete, accurate, valid, and confidential. Business
process application controls include (1) programmed control techniques,
such as automated edits, and (2) manual follow-up of computer-generated
reports, such as reviews of reports identifying rejected or unusual
items. GAGAS paragraph 7.23 defines application controls, or business
controls, as those controls that help ensure the validity,
completeness, accuracy, and confidentiality of transactions and data
during application processing. Chapter 4 discusses the business process
application level controls in an IS controls audit and provides more
detail on the critical elements of each type of business process
application control.
The overall framework of IS control objectives presented in the FISCAM
can be viewed in different ways. One way to summarize the objectives is
presented below.
General Controls:
Security Management:
Controls provide reasonable assurance that security management is
effective, including effective:
* security management program,
* periodic assessments and validation of risk,
* security control policies and procedures,
* security awareness training and other security-related personnel
issues,
* periodic testing and evaluation of the effectiveness of information
security policies, procedures, and practices,
* remediation of information security weaknesses, and;
* security over activities performed by external third parties.
Access Controls:
Controls provide reasonable assurance that access to computer resources
(data, equipment, and facilities) is reasonable and restricted to
authorized individuals, including effective:
* protection of information system boundaries,
* identification and authentication mechanisms,
* authorization controls,
* protection of sensitive system resources,
* audit and monitoring capability, including incident handling, and;
* physical security controls.
Configuration Management:
Controls provide reasonable assurance that changes to information
system resources are authorized and systems are configured and operated
securely and as intended, including effective:
* configuration management policies, plans, and procedures,
* current configuration identification information,
* proper authorization, testing, approval, and tracking of all
configuration changes,
* routine monitoring of the configuration,
* updating software on a timely basis to protect against known
vulnerabilities, and,
* documentation and approval of emergency changes to the configuration.
Segregation of Duties:
Controls provide reasonable assurance that incompatible duties are
effectively segregated, including effective:
* segregation of incompatible duties and responsibilities and related
policies, and;
* control of personnel activities through formal operating procedures,
supervision, and review.
Contingency Planning:
Controls provide reasonable assurance that contingency planning (1)
protects information resources and minimizes the risk of unplanned
interruptions and (2) provides for recovery of critical operations
should interruptions occur, including effective:
* assessment of the criticality and sensitivity of computerized
operations and identification of supporting resources,
* steps taken to prevent and minimize potential damage and
interruption,
* comprehensive contingency plan, and;
* periodic testing of the contingency plan, with appropriate
adjustments to the plan based on the testing.
Business Process Application Controls:
Completeness � controls provide reasonable assurance that all
transactions that occurred are input into the system, accepted for
processing, processed once and only once by the system, and properly
included in output.
Accuracy � controls provide reasonable assurance that transactions are
properly recorded, with correct amount/data, and on a timely basis (in
the proper period); key data elements input for transactions are
accurate; data elements are processed accurately by applications that
produce reliable results; and output is accurate.
Validity � controls provide reasonable assurance (1) that all recorded
transactions and actually occurred (are real), relate to the
organization, are authentic, and were properly approved in accordance
with management�s authorization; and (2) that output contains only
valid data.
Confidentiality � controls provide reasonable assurance that
application data and reports and other output are protected against
unauthorized access.
1.3 Determining the Nature and Extent of Audit Procedures:
The nature, timing, and extent of audit procedures performed to assess
IS controls vary, depending on the audit objectives, the nature and
extent of audit risks and other factors. Factors that can affect the
nature, timing, and extent of audit procedures include the nature and
complexity of the entity�s information systems, the entity�s control
environment, and particular data and applications that are significant
to the financial statements or operations of the entity. As
appropriate, the IS controls specialist, and the financial,
performance, or attestation auditor generally should work cooperatively
to determine the nature, timing, and extent of IS controls audit
procedures.
Inadequate coordination can result in ineffective auditing, for
example, incomplete IS controls audits or improper consideration of the
work performed by the IS controls specialist. When performed as part of
a financial statement audit, an assessment of IS controls is part of a
comprehensive effort to evaluate both the controls over and reliability
of financial reporting. In performance audits and attestation
engagements, the nature and extent of IS controls audit procedures vary
depending on the objectives of the audit.
1.4 Organization of This Manual:
This manual is organized as follows:
* Chapter 2 describes the methodology for performing the IS controls
audit.
* Chapter 3 provides information concerning the five general control
categories, supporting critical elements, critical activities,
potential control techniques, and suggested audit procedures.
* Chapter 4 provides information concerning the four business process
application control level categories, supporting critical elements,
critical activities, potential control techniques, and suggested audit
procedures.
* Appendices provide supplemental information to assist the auditor in
applying the FISCAM methodology.
This manual provides a risk-based approach for performing the
information system controls audit that is consistent with government
auditing standards and the GAO/PCIE Financial Audit Manual (FAM).
[Footnote 7] The FISCAM is consistent with GAGAS and, where
appropriate, the FISCAM discusses the applicable GAGAS requirements.
Each of the nine control categories (five general control categories
and four business process level control categories) represents a
grouping of related controls having similar types of risk. For each
category, this manual discusses the key underlying concepts, associated
risks if the controls in the category are ineffective, and the critical
elements that should be achieved for IS controls to be effective.
This organization structure facilitates the following:
* Audit planning: Related audit steps can be grouped and broken down
into three primary levels: the entitywide level, the system level, and
the application level.
* Evaluation of findings: The effectiveness of IS controls can be
evaluated by control technique, control activity, critical element, and
control category.
* Audit report drafting: Findings can be summarized by control category
and critical element.
To evaluate IS controls, the auditor should use appropriate criteria
that are relevant to the audit objectives. For audits of federal
entities, criteria are provided by the Federal Information Security
Management Act (FISMA) (see Appendix X) and, for non-national security
systems, National Institute of Standards and Technology (NIST) Special
Publication (SP) 800-53, Recommended Security Controls for Federal
Information Systems and other NIST guidance. The Office of Management
and Budget (OMB) requires federal entities to apply other NIST guidance
to non-national security systems. Also, other sources, such as vendor
recommended IS practices and other generally accepted IS resources, may
provide criteria.[Footnote 8] In addition, NIST is responsible for
developing minimum security standards and guidelines that are
complementary with standards and guidelines employed for the protection
of national security systems and information contained in such systems.
FISMA states that standards and guidelines for national security
systems shall be developed, prescribed, enforced, and overseen as
otherwise authorized by law and as directed by the President. Also,
FISMA states that the head of each agency operating or exercising
control of a national security system shall be responsible for ensuring
that the agency:
* provides information security protections commensurate with the risk
and magnitude of the harm resulting from the unauthorized access, use,
disclosure, disruption, modification, or destruction of the information
contained in such system;
* implements information security policies and practices as required by
standards and guidelines for national security systems, issued in
accordance with law and as directed by the President; and;
* complies with the requirements of FISMA.
GAO has consulted with NIST, as provided for in FISMA, and the FISCAM
is mapped to NIST SP 800-53. Appendix IV provides a mapping of the two
documents. In addition, each critical element includes references to
related NIST SP 800-53 controls. NIST SP 800-53 includes a table of the
mapping. Also, to assist auditors, individual FISCAM control activities
reference related NIST SP 800-53 controls. This manual provides
additional narrative to assist the auditor in evaluating IS controls.
In addition, FISCAM incorporates other NIST guidance, including, for
example, NIST SP 800-100, Information Security Handbook: A Guide for
Managers, which includes coverage of programmatic areas such as
information security governance, capital planning and investment
control, and system development life cycle.
The FISCAM, which is consistent with NIST and other criteria, is
organized to facilitate effective and efficient IS controls audits.
Specifically, the methodology in the FISCAM incorporates:
* A top-down, risk-based evaluation that considers materiality and
significance in determining effective and efficient audit procedures
(the auditor determines which IS control techniques are relevant to the
audit objectives and which are necessary to achieve the control
activities; generally, all control activities are relevant unless the
audit scope is limited or the auditor determines that, due to
significant IS control weaknesses, it is not necessary to test all
relevant IS controls).
* An evaluation of entitywide IS controls and their effect on audit
risk, and therefore on the extent of audit testing (effective
entitywide IS controls can reduce audit risk, while ineffective
entitywide IS controls result in increased audit risk and generally are
a contributory cause of IS control weaknesses at the system and
business process application levels)�NIST SP 800-53 principally relates
to controls at the system and application level.
* An evaluation of general controls and their pervasive impact on
business process application controls (effective general controls
support the effectiveness of business process application controls,
while ineffective general controls generally render business process
application controls ineffective).
* An evaluation of security management at all levels of control
(entitywide, system, and business process application levels).
* A control hierarchy (control categories, critical elements, and
control activities) to assist in evaluating the significance of
identified IS control weaknesses (if a critical element is not
achieved, the respective control category is not likely to be achieved;
if one of the nine control categories are not effectively achieved, IS
controls are ineffective, unless other factors sufficiently reduce the
risk).
* Groupings of control categories consistent with the nature of the
risk.
* Experience gained in GAO�s performance and review of IS control
audits, including field testing the concepts in this revised FISCAM.
As discussed above, this manual is organized in a hierarchical
structure to assist the auditor in performing the IS controls audit.
Chapter 3 (general controls) and Chapter 4 (business process
application level controls) contain several control categories, which
are groupings of related controls pertaining to similar types of risk.
For each control category, the manual identifies critical
elements�tasks that are essential for establishing adequate controls
within the category. For each critical element, there is a discussion
of the associated objectives, risks, and control activities, as well as
related potential control techniques and suggested audit procedures.
This hierarchical structure facilitates the auditor�s audit planning
and analysis of identified control weaknesses.
Because control activities are generally necessary to achieve the
critical elements, they are generally relevant to a GAGAS audit unless
the related control category is not relevant, the audit scope is
limited, or the auditor determines that, due to significant IS control
weaknesses, it is not necessary to assess the effectiveness of all
relevant IS controls. Within each relevant control activity, the
auditor should identify control techniques implemented by the entity
and determine whether the control techniques, as designed, are
sufficient to achieve the control activity, considering IS audit risk
and the audit objectives. The auditor may be able to determine whether
control techniques are sufficient to achieve a particular control
activity without evaluating and testing all of the control techniques.
Also, depending on IS audit risk and the audit objectives, the nature
and extent of control techniques necessary to achieve a particular
control objective will vary.
If sufficient, the auditor should determine whether the control
techniques are implemented (placed in operation) and are operating
effectively. Also, the auditor should evaluate the nature and extent of
testing performed by the entity. Such information can assist in
identifying key controls and in assessing risk, but the auditor should
not rely on testing performed by the entity in lieu of appropriate
auditor testing. As discussed later in this section, if the control
techniques implemented by the entity, as designed, are not sufficient
to address the control activity, or the control techniques are not
effectively implemented as designed, the auditor should determine the
effect on IS controls and the audit objectives.
The entity�s management is responsible for implementing an appropriate
system of cost-effective IS controls, including an effective monitoring
program to provide management with reasonable assurance that IS
controls are properly designed and effectively operating. The auditor�s
responsibility is to perform tests of the IS controls and provide
conclusions on the results of such tests to support the audit
objectives.
1.4.1 Appendices:
The appendices to the FISCAM, summarized below, provide additional
information to assist the auditor in performing the IS controls audit.
List of Appendices:
Appendix I:
Description: Information System Controls Audit Planning Checklist;
Purpose: To assist the auditor in requesting relevant background
information.
Appendix II:
Description: Tables for Summarizing Work Performed in Evaluating and
Testing General and Business Process Application Controls;
Purpose: To assist the auditor in summarizing work performed.
Appendix III:
Description: Tables for Assessing the Effectiveness of General and
Business Process Application Controls;
Purpose: To assist the auditor in assessing and reporting on IS
controls.
Appendix IV:
Description: Mapping of FISCAM to SP 800-53;
Purpose: To show correlation between FISCAM critical elements and NIST
SP 800-53.
Appendix V:
Description: Knowledge, Skills, and Abilities Needed to Perform
Information System Controls Audits;
Purpose: Skill sets necessary to perform the IS controls audit.
Appendix VI:
Description: Scope of an Information System Controls Audit in Support
of a Financial Audit;
Purpose: To show relation of FISCAM to relevant FAM sections.
Appendix VII:
Description: Entity�s Use of Service Organizations;
Purpose: Audit issues related to an entity�s use of a service
organization and use of FISCAM as a basis for performing a SAS 70
audit.
Appendix VIII:
Description: Application of FISCAM to Single Audits;
Purpose: Use of FISCAM to assess IS controls over compliance
requirements and financial reporting in connection with a single audit.
Appendix IX:
Description: Application of FISCAM to FISMA;
Purpose: Use of FISCAM for the independent evaluation of a federal
agency�s information security program required by FISMA.
Appendix X:
Description: Federal Information Security Management Act of 2002
(FISMA);
Purpose: Key legislation containing criteria for federal IS controls
audits.
Appendix XI:
Description: Information System Controls Audit Documentation;
Purpose: Summarizes IS controls audit documentation.
Appendix XII:
Description: Glossary;
Purpose: Key terms used in the FISCAM.
Appendix XIII:
Description: Bibliography;
Purpose: List of information sources.
[End of chapter]
Chapter 2. Performing the Information System Controls Audit:
2.0 Introduction:
The information system (IS) controls audit involves the following three
phases:
* Planning: The auditor determines an effective and efficient way to
obtain the evidential matter necessary to achieve the objectives of the
IS controls audit and the audit report. For financial audits, the
auditor develops an audit strategy and an audit plan. For performance
audits, the auditor develops an audit plan.
* Testing: The auditor tests the effectiveness of IS controls that are
relevant to the audit objectives.
* Reporting: The auditor concludes on the effect of any identified IS
control weaknesses on the audit objectives and reports the results of
the audit, including any material weaknesses and other significant
deficiencies.
Appendix VI provides the scope of an IS controls audit in support of a
financial statement audit.
For each of the three phases, the auditor prepares appropriate audit
documentation.
2.1 Planning the Information System Controls Audit:
2.1.1 Overview:
In planning the IS controls audit, the auditor uses the equivalent
concepts of materiality (in financial audits) and significance
[Footnote 9] (in performance audits) to plan both effective and
efficient audit procedures. Materiality and significance are concepts
the auditor uses to determine the planned nature, timing, and extent of
audit procedures. The underlying principle is that the auditor is not
required to spend resources on items of little importance; that is,
those that would not affect the judgment or conduct of a reasonable
user of the audit report, in light of surrounding circumstances. On the
basis of this principle, the auditor may determine that some areas of
the IS controls audit (e.g., specific systems) are not material or
significant, and therefore warrant little or no audit attention.
Materiality and significance include both quantitative and qualitative
factors in relation to the subject matter of the audit. Even though a
system may process transactions that are quantitatively immaterial or
insignificant, the system may contain sensitive information or provide
an access path to other systems that contain information that is
sensitive or otherwise material or significant. For example, an
application that provides public information via a website, if
improperly configured, may expose internal network resources, including
sensitive systems, to unauthorized access. Materiality is more fully
discussed in the FAM in section 230 (Determine Planning, Design, and
Test Materiality), and both terms are discussed further in GAGAS.
Planning occurs throughout the audit as an iterative process. (For
example, based on findings from the testing phase, the auditor may
change the planned audit approach, including the design of specific
tests.) However, planning activities are concentrated in the planning
phase, during which the objectives are to obtain an understanding of
the entity and its operations, including its internal control, identify
significant issues, assess risk, and design the nature, extent, and
timing of audit procedures. To accomplish this, the methodology
presented in this chapter includes guidance to help the auditor do the
following:
* Understand the overall audit objectives and related scope of the IS
controls audit;
* Obtain an understanding of an entity and its operations and key
business processes;
* Obtain a general understanding of the structure of the entity�s
networks;
* Identify key areas of audit interest (files, applications, systems,
locations);
* Assess IS risk on a preliminary basis ? Identify critical control
points (for example, external access points to networks);
* Obtain a preliminary understanding of IS controls;
* Perform other audit planning procedures.
Although each of these areas is discussed separately in this chapter,
they are not generally performed as discrete, sequential steps. For
example, the IS controls specialist may gather information related to
several steps concurrently, such as through interviews with key
information technology (IT) staff or through data requests, or may
perform steps in a different sequence. The auditor performs planning to
determine an effective and efficient way to obtain the evidential
matter necessary to support the objectives of the IS controls audit and
the audit report. The nature and extent of audit planning procedures
varies for each audit depending on several factors, including the
entity�s size and complexity, the auditor�s experience with the entity,
and the auditor�s knowledge of the entity�s operations.
A key to a high-quality audit, the senior members of the audit team
should be involved in planning. The auditor should coordinate with the
entity being audited and, if the IS controls audit is part of another
audit, with senior members of the overall audit team. In addition,
auditors generally should determine the needs of other auditors who
plan to use the work being performed and consult with them in a timely
manner, especially when making decisions involving significant
judgment.
If the IS controls audit is performed as part of a financial audit,
GAGAS require the auditor to obtain an understanding of internal
control over financial reporting sufficient to assess the risk of
material misstatement of the financial statements whether due to error
or fraud, and to design the nature, timing, and extent of further audit
procedures based on that assessment. This includes performing risk
assessment procedures to evaluate the design of controls relevant to an
audit of financial statements and to determine whether they have been
implemented. In obtaining this understanding, the auditor considers how
an entity�s use of information technology (IT) and manual procedures
affect controls relevant to the audit. The auditor�s responsibilities
for considering internal control in a financial audit are described in
more detail in the FAM.
If the IS controls audit is performed as part of a performance audit,
GAGAS[Footnote 10] (para. 7.24) states that when information systems
controls are determined to be significant to the audit objectives,
auditors should then evaluate the design and operating effectiveness of
such controls. This evaluation would include other information systems
controls that impact the effectiveness of the significant controls or
the reliability of information used in performing the significant
controls. Auditors should obtain a sufficient understanding of
information systems controls necessary to assess audit risk and plan
the audit within the context of the audit objectives.
Additionally, GAGAS (para. 7.27) states that auditors should determine
which audit procedures related to information systems controls are
needed to obtain sufficient, appropriate evidence to support the audit
findings and conclusions. It also provides the following factors to
assist the auditor in making this determination:
a. The extent to which internal controls that are significant to the
audit depend on the reliability of information processed or generated
by information systems.
b. The availability of evidence outside the information system to
support the findings and conclusions: It may not be possible for
auditors to obtain sufficient, appropriate evidence without assessing
the effectiveness of relevant information systems controls. For
example, if information supporting the findings and conclusions is
generated by information systems or its reliability is dependent on
information systems controls, there may not be sufficient supporting or
corroborating information or documentary evidence that is available
other than that produced by the information systems.
c. The relationship of information systems controls to data
reliability: To obtain evidence about the reliability of computer-
generated information, auditors may decide to assess the effectiveness
of information systems controls as part of obtaining evidence about the
reliability of the data. If the auditor concludes that information
systems controls are effective, the auditor may reduce the extent of
direct testing of data.
d. Assessing the effectiveness of information systems controls as an
audit objective: When assessing the effectiveness of information
systems controls is directly a part of an audit objective, auditors
should test information systems controls necessary to address the audit
objectives. For example, the audit may involve the effectiveness of
information systems controls related to certain systems, facilities, or
organizations.
2.1.2 Understand the Overall Audit Objectives and Related Scope of the
Information System Controls Audit:
The nature, timing, and extent of IS controls audit procedures vary
depending upon the audit objectives. For example, the IS controls
audit:
* may be performed as part of a financial or performance audit, or may
be performed as a separate engagement;
* may comprehensively address an entire entity, a component, or a
network, or may narrowly target an application, specific technology
(e.g., wireless, operating system, etc.), or location; and/or;
* may include all control objectives or only a subset of control
objectives (e.g., general controls, business process controls, or
selected components of them, such as focusing on an entity�s security
management program).
If achieving the audit objectives does not require an overall
conclusion on the effectiveness of the entity�s IS controls or relates
only to certain components of the entity or a subset of controls, the
auditor�s assessment would not necessarily identify all significant IS
control weaknesses that may exist. For example, a limited review of
controls over a type of operating system may not identify any
significant weaknesses, although there may be very significant
weaknesses in other areas that the auditor is unaware of because the
scope of the audit is limited. Consequently, the auditor should
evaluate the potential limitations of the auditor�s work on the
auditor�s report and the needs and expectations of users. The auditor
may determine that, because the limitations are so significant, the
auditor will (1) communicate the limitations to the management of the
audited entity, those charged with governance, and/or those requesting
the audit, and (2) clearly report such limitations on the conclusions
in the audit report. For example, in reporting on an audit of an
operating system, the auditor may determine that it is appropriate to
clearly report that the scope of the assessment was limited to the
operating system and that, consequently, additional IS control
weaknesses may exist that could impact the effectiveness of IS controls
related to the operating system and to the entity as a whole.
Based on the overall engagement objectives, the auditor should develop
and document the objectives of the IS controls audit. Typical IS
controls audit objectives include the following:
* To support financial statement audits by, for example, assessing the
effectiveness of IS controls related to financial reporting. (Note: The
assessment of IS controls generally occurs during the internal control
phase of a financial statement audit.) This assessment affects the
nature, timing, and extent of financial audit procedures to be
performed, as well as provide timely recommendations for improvements
in IS controls. In addition, it may cover the entire audit year or
relate only to controls at a point in time, such as at the end of the
fiscal year. The scope of an IS controls audit in support of a
financial audit is described further in the FAM and in Appendix VI.
* To supplement IT performance audits by assessing the effectiveness of
security within the context of a broader systems review.
* To support other performance audits, such as assessing data
reliability or how well an information system protects the
confidentiality, integrity, and availability of data and the effect of
this level of protection on program performance.
* To determine the effectiveness of IS controls, not in support of
another audit, so that any risks are identified. Such audits may be
designed to provide a conclusion on the effectiveness of IS controls
and describe any material weaknesses and other significant
deficiencies, or merely describe any IS control weaknesses without an
overall conclusion as to the effectiveness of IS controls.
* To support evaluation of IS controls as required by FISMA.
* To support single audits.
The auditor should also determine and document (such as in an audit
strategy and audit plan) the appropriate scope of the IS controls
audit, including:
* the organizational entities to be addressed (e.g., entitywide,
selected component(s), etc.);
* the breadth of the audit (e.g., overall conclusion on IS control
effectiveness, review of a specific application or technology area,
such as wireless or UNIX, etc.);
* the types of IS controls to be tested: ? general and/or business
process application level controls to be tested, or selected
components; or;
* all levels of the entity�s information systems, or selected levels
(e.g., entitywide, system level, or business process application level,
or selected components of them�for definitions of each level, see the
section below entitled �2.2 Perform Information System Controls Audit
Tests,�).
If the IS controls audit is performed as part of another audit, the
auditor should understand the overall audit objectives and how the IS
controls audit will integrate with the audit. The auditor should reach
a common understanding of objectives with the audit team responsible
for the overall audit.
2.1.3 Understand the Entity�s Operations and Key Business Processes:
The auditor should obtain and document an understanding of the entity
sufficient to plan and perform the audit in accordance with applicable
auditing standards and requirements. In planning the audit, the auditor
obtains information that will provide an overall understanding of the
entity, such as its mission, size and location, organization, business,
strategies, risks, and internal control structure. Understanding the
entity�s operations in the planning process enables the auditor to
identify, respond to, and resolve problems early in the audit.
The auditor�s understanding of the entity includes:
* entity management and organization,
* external and internal factors affecting the entity�s operations, and,
* key business processes (defined below).
To plan the audit, the auditor obtains a general understanding of the
entity�s and the IT function�s organizational structure, including key
members of entity and IT management.
The auditor�s main objective is to understand how the entity is managed
and how the organization is structured. The auditor should identify
significant external and internal factors that affect the entity�s
operations, particularly IT. External factors might include (1) IT
budget, (2) external systems users, (3) current political climate, and
(4) relevant legislation. Internal factors might include (1) size of
the entity, (2) number of locations, (3) structure of the entity
(centralized or decentralized), (4) complexity of operations, (5) IT
management structure, (6) impact of information systems on business
operations, (7) qualifications and competence of key IT personnel, and
(8) turnover of key IT personnel.
The auditor should document any significant factors that could affect
the IS controls audit, including the auditor�s risk assessment. The
auditor should also obtain a general understanding of the entity�s
business processes, particularly those processes most closely related
to the audit objectives. Business processes are the primary functions
that the entity performs in accomplishing its mission. Examples of
typical business processes in government entities include:
* mission-related processes, typically at the program or subprogram
level, such as education, public health, law enforcement, or income
security;
* financial management processes, such as collections, disbursements,
or payroll; and;
* other support processes, such as human resources, property
management, or security.
Understanding the entity's operations and business processes includes
understanding how business process applications are used to support key
business processes, as it tends to vary from entity to entity. The
auditor should obtain and review documentation, such as design
documents, blueprints, business process procedures, user manuals, etc.,
and inquire of knowledgeable personnel to obtain a general
understanding of each significant business process application that is
relevant to the audit objectives. This includes a detailed
understanding of:
* business rules (e.g. removing all transactions that fail edits or
only selected ones based on established criteria),
* transaction flows (detailed study of the entity�s internal controls
over a particular category of events that identifies all key procedures
and controls relating to the processing of transactions), and;
* application and software module interaction (transactions leave one
system for processing by another, e.g. payroll time card interfaces
with pay rate file to determine salary information).
Obtaining this understanding is essential to assessing information
system risk, understanding application controls, and developing
relevant audit procedures. For efficiency, the auditor may combine this
step with the steps in FISCAM section 2.2.1 subsection entitled
�Understand Information Systems Relevant to the Audit Objectives� to
aid in the identification of relevant controls.
The auditor should identify and document the key business processes
that are relevant to the audit objectives. For each key business
process, the auditor should identify the significant general support
systems and major applications that are used to support each key
business process.[Footnote 11] Also, for each key business process, the
auditor should identify the use of contractors and others to process
information and/or operate systems for or on behalf of the entity.
Throughout the remainder of this manual, references to entity systems
and business processes include the use of contractors and others to
process information and/or operate systems for or on behalf of the
entity. If the IS controls audit is performed as part of a financial
audit, as discussed in FAM 320 (Understand Information Systems) and
other FAM sections, the auditor should obtain an understanding of the
entity�s information systems (including methods and records) for
processing and reporting accounting (including supplemental
information), compliance, and operations data (including performance
measures reported in the Management�s Discussion and Analysis).
The auditor should document an understanding of the entity�s operations
and key business processes, including the following items to the extent
relevant to the audit objectives:
* the significance and nature of the programs and functions supported
by information systems;
* a general understanding of the entity�s and the IT function�s
organizational structure;
* key business processes relevant to the audit objectives, including
business rules, transaction flows, and application and software module
interaction;
* significant general support systems and major applications that
support each key business process; ? background information checklist,
if used;
* significant internal and external factors that could affect the IS
controls audit objectives;
* a detailed organization chart, particularly the IT and the IS
components;
* significant changes in the IT environment or significant applications
implemented within the recent past (e.g. 2 years) or planned within the
near future (e.g., 2 years); and;
* the entity�s reliance on third parties to provide IT services (e.g.,
in-house, remote connectivity, remote processing).
Appendix I includes an Information System Controls Audit Planning
Checklist that can be provided to the entity�s management to facilitate
gathering appropriate information for this audit step.
The auditor generally gathers planning information through different
methods (observation, interviews, reading policy and procedure manuals,
etc.) and from a variety of sources, including:
* previous audits and management reviews,
* top-level entity and IT management,
* entity management responsible for relevant significant programs,
* Office of Inspector General (IG) and internal audit management
(including any internal control officer),
* other members of the audit organization, concerning relevant
completed, planned or in-progress assignments,
* personnel in the Office of General Counsel, and;
* personnel in the Special Investigator Unit.
Also, the auditor generally gathers information from relevant reports
and articles issued by or about the entity, including:
* GAO reports;
* IG, internal audit, or other audit reports (including those for
performance audits and other reviews);
* congressional hearings and reports;
* consultant reports; and;
* material published about the entity in newspapers, magazines,
Internet sites, and other publications.
2.1.4 Obtain a General Understanding of the Structure of the Entity�s
Networks:
The auditor should obtain and document a general understanding of the
structure of the entity�s networks as a basis for planning the IS
controls audit. The auditor�s understanding includes a high-level view
of the network architecture that the entity uses to implement key
business processes. Such an understanding helps the auditor to assess
risk, identify potential critical control points on a preliminary
basis, understand technologies that may be subject to audit, and
identify key locations. The auditor generally should request
documentation of such information from the entity, including both high-
level and detailed network schematics. The auditor should obtain the
following information about the network architecture, generally
documented in network schematics:
* Internet presence;
* firewalls, routers, and switches;
* intrusion detection or prevention systems;
* critical systems, such as Web and mail systems, file transfer
systems, etc.;
* network management systems;
* connections to inter- and intra-agency sites;
* connections to other external organizations;
* remote access�virtual private network and dial-in; and;
* wireless connections.
2.1.5 Identify Key Areas of Audit Interest:
The auditor should identify key areas of audit interest, which are
those that are critical to achieving the audit objectives (e.g.,
general support and business process application systems and files (or
components thereof)). For a financial audit, this would include key
financial applications and data and related feeder systems.[Footnote
12] For a performance audit, this would include key systems that are
likely to be significant to the audit objectives. For each key area of
audit interest, the auditor should document relevant general support
systems and major applications and files, including (1) the operational
locations of each key system or file, (2) significant components of the
associated hardware and software (e.g., firewalls, routers, hosts,
operating systems), (3) other significant systems or system level
resources that support the key areas of audit interest, and (4) prior
audit problems reported. The auditor should also identify all access
paths into and out of the key areas of audit interest. By identifying
the key systems, files, or locations, the auditor can concentrate
efforts on them, and do little or no work associated with other areas.
The auditor generally should prioritize important systems, files, or
locations in order of importance to the audit objectives. The auditor
may characterize these items by the sensitivity or significance of the
information processed, dollar value of the transactions processed, or
presence or number of key edits or other controls performed by a
business process application.
2.1.6 Assess Information System Risk on a Preliminary Basis:
Overview:
The auditor should assess, on a preliminary basis, the nature and
extent of IS risk that relates to the key areas of audit interest. IS
risk is the likelihood that a loss of confidentiality, integrity, or
availability could occur that would materially/significantly affect the
audit objectives (e.g., for a financial audit, a material
misstatement). Assessing IS risk involves evaluation of both the
likelihood that such a loss of confidentiality, integrity, or
availability could occur and the materiality or significance of a loss
of confidentiality, integrity, or availability to the audit objectives.
The auditor should document factors that significantly increase or
decrease the level of IS risk and their potential impact on the
effectiveness of information system controls.
Assessing IS risk relating to the audit is different from management�s
risk assessment. In assessing IS risk, the auditor is not required or
expected to reperform management�s risk assessment. Rather, the auditor
assesses IS risk on a preliminary basis using data that would be
collected in the planning of audit (this includes using the entity�s
risk assessments and performing other audit procedures as outlined
below). The auditor�s risk assessment should reflect the impact of the
effectiveness of IS controls on the audit objectives.
The auditor�s assessment of IS risk affects the nature, timing, and
extent of IS controls audit procedures. As IS risk increases, the
auditor should perform more extensive or more effective tests of IS
controls. For example, a significant number of Internet access points
that are not centrally controlled increases IS risk. In this case, the
auditor would expand the auditor�s testing, as there are more potential
access paths to the key areas of audit interest. Risk assessments
prepared by the entity may serve as a useful tool to assist in the
identification of IS risk. However, the auditor should not rely on them
without performing audit procedures to identify and assess risk.
To develop a framework for analyzing IS risk, the auditor should
consider IS risk in the context of the following three security
objectives for information and information systems:
* Integrity�guarding against improper information modification or
destruction, which includes ensuring information nonrepudiation
[Footnote 13] and authenticity [Footnote 14]. A loss of integrity is
the unauthorized modification or destruction of information.
* Confidentiality�preserving authorized restrictions on information
access and disclosure, including means for protecting personal privacy
and proprietary information. A loss of confidentiality is the
unauthorized disclosure of information.
* Availability�ensuring timely and reliable access to and use of
information. A loss of availability is the disruption of access to or
use of information or an information system.
In some instances, one or more of the security objectives may have more
significance to the audit objectives than the others.
The auditor should identify factors or conditions that significantly
increase or decrease IS risk. These factors are general in nature; the
auditor uses judgment in determining (1) the extent of procedures to
identify the risks and (2) the impact of such risks on the entity�s
operations and the audit objectives. Because this risk assessment
involves the exercise of significant audit judgment, the auditor should
use experienced audit team personnel to perform the risk assessment.
Factors considered would include those related to inherent risk
[Footnote 15] as well as those related to the control environment, risk
assessment, communication, and monitoring components of internal
control [Footnote 16]. The auditor identifies such factors based on
information obtained in the planning phase, primarily from
understanding the entity�s operations and key business processes,
including significant IT processing performed outside the entity.
For each risk identified, the auditor should document the nature and
extent of the risk; the conditions that gave rise to that risk; and the
specific information or operations affected (if not pervasive). The
auditor should also document compensating controls or other
considerations that may mitigate the effects of identified risks. The
auditor should assess and document, on a preliminary basis, the nature
and extent of IS risks for the information and information systems
related to the key areas of audit interest, considering
confidentiality, integrity, and availability. The auditor should
document the basis for the assessed risk and its potential impact on
the audit objectives. For example, in a financial audit, the auditor
should evaluate the possibility of a material misstatement as a result
of a loss of confidentiality, integrity, or availability. As discussed
above, risk assessments prepared by the entity may serve as a useful
tool to assist the auditor in the identification of IS risks.
As noted above, IS risk includes the risk of loss of confidentiality,
integrity, or availability. Such risk includes the potential impact of
a loss to entity operations, assets, and individuals. However,
depending on the audit objectives, the impact on the audit objectives
could be greater or lesser. Federal agencies are required to use the
following three levels to categorize their systems based on the
potential impact of a breach of security on organizational operations,
organizational assets, or individuals:[Footnote 17]
* Low. The loss of confidentiality, integrity, or availability could be
expected to have a limited adverse effect on organizational operations,
organizational assets, or individuals.[Footnote 18] A limited adverse
effect means that, for example, the loss of confidentiality, integrity,
or availability might (i) cause a degradation in mission capability to
an extent and duration that the organization is able to perform its
primary functions, but the effectiveness of the functions is noticeably
reduced; (ii) result in minor damage to organizational assets; (iii)
result in minor financial loss; or (iv) result in minor harm to
individuals.
* Moderate. The loss of confidentiality, integrity, or availability
could be expected to have a serious adverse effect on organizational
operations, organizational assets, or individuals. A serious adverse
effect means that, for example, the loss of confidentiality, integrity,
or availability might (i) cause a significant degradation in mission
capability to an extent and duration that the organization is able to
perform its primary functions, but the effectiveness of the functions
is significantly reduced; (ii) result in significant damage to
organizational assets; (iii) result in significant financial loss; or
(iv) result in significant harm to individuals that does not involve
loss of life or serious life-threatening injuries.
* High. The loss of confidentiality, integrity, or availability could
be expected to have a severe or catastrophic adverse effect on
organizational operations, organizational assets, or individuals. A
severe or catastrophic adverse effect means that, for example, the loss
of confidentiality, integrity, or availability might (i) cause a severe
degradation in or loss of mission capability to an extent and duration
that the organization is not able to perform one or more of its primary
functions; (ii) result in major damage to organizational assets; (iii)
result in major financial loss; or (iv) result in severe or
catastrophic harm to individuals involving loss of life or serious life-
threatening injuries.
The auditor�s assessment of IS risk may change as audit evidence is
obtained. To determine whether audit procedures continue to be
appropriate, the auditor should periodically reassess the IS risk
during the audit. For example, the auditor may reassess the IS risk
level at the end of the planning and testing phases, as well as when
evidence is obtained that significantly affects the auditor�s risk
assessment. If IS risk changes during the audit, the auditor should
make any necessary changes to the nature, timing, and extent of planned
audit procedures.
Inherent Risk Factors:
Information systems can introduce additional risk factors not present
in a manual system. To properly assess IS risk, the auditor should (1)
evaluate each of the following factors and (2) assess the overall
impact of information systems on IS risk. The impact of these factors
typically will be pervasive in nature.
* The nature of the hardware and software may affect IS risk, as
illustrated below.
* The type of processing (online, batch oriented, or distributed)
presents different levels of IS risk. Distributed networks enable
multiple computer processing units to communicate with each other,
increasing the number of potential access points and the risk of
unauthorized access to computer resources and possible data alteration.
On the other hand, distributed networks may decrease the risk of data
inconsistencies at multiple processing units if the units share a
common database.
* Peripheral access devices or system interfaces can increase IS risk.
For example, Internet or wireless access to a system increases the
system�s accessibility to additional persons and therefore increases
the risk of unauthorized access to computer resources.
* Highly customized application software may have higher IS risk than
vendor-supplied software that has been thoroughly tested and is in
general commercial use. On the other hand, vendor-supplied software new
to commercial use may not have been thoroughly tested or undergone
client processing to a degree that would encounter existing flaws.
* Certain hardware and software may have more significant identified
weaknesses than others.
* In certain systems (e.g., enterprise resource planning�ERP�systems
[Footnote 19]), the audit trails and supporting information produced by
the systems may be limited in their usefulness (1) as a basis for
applying certain types of controls or (2) as audit evidence.
* Highly decentralized applications, particularly Web applications,
increase IS risk by adding complexity to IS and increasing potential
vulnerabilities.
* The application of new technologies generally increases the risk that
secure configurations of such technologies may not be well developed or
tested, or that IT personnel may not properly implement security over
such new technologies.
* The manner in which the entity�s networks are configured can affect
the related IS risk. For example, factors increasing IS risks include a
significant number of Internet access points that are not centrally
controlled, networks that are not segmented to protect sensitive
systems or information, use of technologies that are no longer
supported, or lack of technologies that enhance security.
* The consistency of the entity�s enterprise architecture and IT
strategy with its business strategies can affect the proper planning
and implementation of IT systems and related security.
Also, the following risk factors, discussed in FAM 260 (Identify Risk
Factors) are relevant to both financial and performance audits:
* Uniform processing of transactions: Because information systems
process groups of identical transactions consistently, any
misstatements arising from erroneous computer programming will occur
consistently in the same types of transactions. However, the risk of
random processing errors is reduced substantially in information
systems�based accounting systems.
* Automatic processing: The information system may automatically
initiate transactions or perform processing functions. Evidence of
these processing steps (and any related controls) may or may not be
visible.
* Increased potential for undetected misstatements: Information systems
use and store information in electronic form and require less human
involvement in processing than manual systems. Without adequate
controls, there is increased risk that individuals could gain
unauthorized access to sensitive information and alter data without
leaving visible evidence. Because information is in electronic form,
changes to computer programs and data are not readily detectable. Also,
users may be less likely to challenge the reliability of information
systems output than manual reports.
* Existence, completeness, and volume of the audit trail: The audit
trail is the evidence that demonstrates how a specific transaction was
initiated, processed, and summarized. For example, the audit trail for
a purchase could include a purchase order; a receiving report; an
invoice; an entry in an invoice register (purchases summarized by day,
month, and/or account); and general ledger postings from the invoice
register. Some computer systems are designed to maintain the audit
trail for only a short period, only in an electronic format, or only in
summary form. Also, the information generated may be too voluminous to
be analyzed effectively without software. For example, one transaction
may result from the automatic summarization of information from
hundreds of locations. Without the use of audit or retrieval software,
tracing transactions through the processing may be extremely difficult.
* Unusual or nonroutine transactions: As with manual systems, unusual
or nonroutine transactions increase IS risk. Programs developed to
process such transactions may not be subject to the same procedures as
programs developed to process routine transactions. For example, the
entity may use a utility program to extract specified information in
support of a nonroutine management decision.
In addition, the auditor should evaluate the additional audit risk
factors discussed in the �Additional IS Risk Factors� at the end of
this chapter.
Risk Factors Related to the Control Environment, Risk Assessment,
Communication, and Monitoring Components of Internal Control:
Also, the auditor should evaluate the following IT system factors, to
the extent relevant to the audit objectives, in making an overall
assessment of the control environment, risk assessment, communication,
and monitoring components of internal control.
a. Management's attitudes and awareness with respect to IT systems:
Management�s interest in and awareness of IT system functions
(including those performed for the entity by other organizations) is
important in establishing an organizationwide consciousness of control
issues. Management may demonstrate its interest and awareness by:
* considering the risks and benefits of computer applications;
* communicating policies regarding IT system functions and
responsibilities;
* overseeing policies and procedures for developing, modifying,
maintaining, and using computers, and for controlling access to
programs and files;
* considering the risk of material misstatement, including fraud risk,
related to IT systems;
* responding to previous recommendations or concerns;
* quickly and effectively planning for, and responding to, computerized
processing crises; and;
* using reliable computer-generated information for key operating
decisions.
b. Organization and structure of the IT system function: The
organizational structure affects the control environment. Centralized
structures often have a single computer processing organization and use
a single set of system and applications software, enabling tighter
management control over IT systems. In decentralized structures, each
computer center generally has its own computer processing organization,
application programs, and system software, which may result in
differences in policies and procedures and various levels of compliance
at each location.
c. Clearly defined assignment of responsibilities and authority:
Appropriate assignment of responsibility according to typical IT system
functional areas can affect the control environment. Factors to
consider include:
* how the position of the Chief Information Officer (CIO) fits into the
organizational structure;
* whether duties are appropriately segregated within the IT systems
function, such as operators and programmers, since lack of segregation
typically affects all systems;
* the extent to which management external to the IT systems function is
involved in major systems development decisions; and;
* the extent to which IT system policies, standards, and procedures are
documented, understood, followed, and enforced.
d. Management�s ability to identify and to respond to potential risk:
Computer processing, by its nature, introduces additional risk factors.
The entity should be aware of these risks and should develop
appropriate policies and procedures to respond to any IT system issues
that might occur. The auditor may evaluate:
* the methods for monitoring incompatible functions and for enforcing
segregation of duties and;
* management�s mechanism for identifying and responding to unusual or
exceptional conditions.
Examples of potential IT-related control environment, risk assessment,
communication, and monitoring weaknesses include:
* Management and personnel in key areas (such as accounting, IT
systems, IG, and internal auditing) have a high turnover.
* Management attitude toward IT systems and accounting functions is
that these are necessary ��bean counting�� functions rather than a
vehicle for exercising control over the entity's activities or making
better decisions.
* The number of people, particularly in IT systems and accounting, with
requisite skill levels relative to the size and complexity of the
operations is inadequate.
* Management has not adequately identified risks arising from internal
sources, such as human resources (ability to retain key people) or IT
(adequacy of backup systems in the event of systems failure).
* Accounting systems and/or information systems, including IT systems,
are not modified in response to changing conditions.
2.1.7 Identify Critical Control Points:
The auditor should identify and document critical control points in the
design of the entity�s information systems based on the auditor�s
understanding of such systems, key areas of audit interest, and IS
risk. Critical control points are those system control points that, if
compromised, could allow an individual to gain unauthorized access to
or perform unauthorized or inappropriate activities on entity systems
or data, which could lead directly or indirectly to unauthorized access
or modifications to the key areas of audit interest. Control points
typically include external access points to the entity�s networks,
interconnections with other external and internal systems, system
components controlling the flow of information through the entity�s
networks or to the key areas of audit interest, critical storage and
processing devices, and related operating systems, infrastructure
applications, and relevant business process applications. Typical
control points also include network components where business process
application controls are applied. As the audit testing proceeds and the
auditor gains a better understanding of the entity�s information
systems, of control weaknesses, and of the related risks, the auditor
should periodically reassess the critical control points. Based on
information obtained during audit planning, the auditor should identify
those critical control points in the entity�s IT systems that are
significant to the effectiveness of security over the key areas of
audit interest.
An analysis of critical control points includes consideration of
alternate work sites. Since multiple FISCAM control categories are
relevant to alternate work sites, it is not addressed as a specific
control in this document. For further information on this subject refer
to NIST guidance contained in SP 800-53 and SP 800-46.
In identifying critical control points and in planning and performing
the assessment of IS controls, auditors apply the concept of control
dependencies. A control dependency exists when the effectiveness of an
internal control is dependent on the effectiveness of other internal
controls. An assessment of the effectiveness of information system
controls over a critical control point includes testing the
effectiveness of controls over other control points upon which the
security of the critical control point is dependent. Figure 2
illustrates the concept of a control dependency in relation to a router
for a typical network.
Figure 2: Example of Router Control Dependencies:
[See PDF for image]
This figure is an illustration of Router Control Dependencies. The
following items are depicted:
* Private or public network;
* Firewall;
* Switch;
* outer;
- Dial-in; modem;
- Console port;
* Switch;
-Administrator workstation;
- Log server;
- Network management server;
- Authentication server;
- Trivial file transfer protocol server;
- Remote access server.
Source: GAO.
[End of figure]
The figure illustrates that the effectiveness of controls over the
router in this example network are dependent on controls over other
control points. In this example, because unauthorized or inappropriate
access to the other control points could affect the security of the
router, the auditor�s tests of IS controls generally should include
controls over:
* the trivial file transfer protocol (tftp) servers used to maintain a
central repository of sensitive configuration files (tftp servers do
not require authentication and are also used as remote boot devices for
routers);
* the centralized authentication server that authenticates users to the
router and other network devices;
* network switches that could share sensitive data with routers such as
passwords and shared keys (also, network switches provide a trusted
path to the routers);
* administrative workstations used to manage network devices, such as
routers; and;
* the log server, which maintains logs containing relevant information
about significant network events, such as router access.
In addition, as part of a review of the system level controls over the
router, the auditor generally should test controls over:
* the network management servers used to manage configuration files
that contain sensitive information about network devices such as
routers;
* remote access to the router via the auxiliary and console ports that
could be used to remotely manage the router;
* the firewalls that provide boundary protection (i.e., limits
connectivity to the router);
* unencrypted network traffic that could be �sniffed� to obtain router
or other privileged passwords; and;
* the PC connected to the router that could facilitate direct
connectivity to the router.
Further, the auditor generally should test other controls that may
affect the security of the router, based on the auditor�s judgment.
Note that, in addition to controls over access to the router itself, IS
controls include controls over the routing of traffic throughout the
network (see AC-1 in Chapter 3).
As the auditor performs the IS controls audit, based on the auditor�s
assessment of risk and the results of audit tests, the auditor may
determine that it is necessary to modify the scope of the audit. For
example, if significant IS control weaknesses are identified during the
audit, it may not be necessary to perform all planned tests of IS
controls. If testing is reduced due to the identification of
significant weaknesses, the auditor should document such a decision.
Also, testing may result in the identification of additional risks, and
critical control points, and/or control dependencies; the auditor
should determine whether to adjust the scope for them.
2.1.8 Obtain a Preliminary Understanding of Information System
Controls:
The auditor should obtain and document a preliminary understanding of
the design of the entity�s IS controls, including the organization,
staffing, responsibilities, authorities, and resources of the entity�s
security management function. The auditor should document a preliminary
understanding of entitywide controls (or componentwide controls if only
a component is being audited) related to security management, access
controls, configuration management, segregation of duties and,
contingency planning.
The auditor should understand the design of each of the three types of
IS controls (general, business process application, and user controls)
to the extent necessary to tentatively conclude whether these controls
are likely to be effective. If they are likely to be effective, the
auditor should consider specific IS controls in determining whether
relevant IS control objectives are achieved. If IS controls are not
likely to be effective, the auditor should obtain a sufficient
understanding of control risks arising from IS controls to assess audit
risk, design appropriate audit procedures, and develop appropriate
findings.
In addition, the auditor should obtain a preliminary understanding of
the business process application controls (business process, interface,
and data management system controls) over key business process
applications identified as or related to key areas of audit interest,
determine where those controls are applied, and determine whether the
controls are designed effectively and have been implemented (placed in
operation). For example, authentication and authorization may be
applied in network components that are different from those where key
data files or applications reside; (e.g., Web applications that reside
on one server may be used to authenticate and authorize users of legacy
systems that run on different servers or systems). The auditor should
determine the potential impact of any identified design weaknesses on
the completeness, accuracy, validity, and confidentiality of related
application data. (See Chapter 4 for a description of completeness,
accuracy, validity, and confidentiality.)
The auditor should make a preliminary assessment of whether IS controls
are likely to be effective to assist in determining the nature, timing,
and extent of testing. This assessment is based primarily on
discussions with personnel throughout the entity, including program
managers, system administrators, information resource managers, and
systems security managers; on observations of IT operations and
controls; on reviewing examples of evidence of control performance; on
prior audits or the work of others; and on reading written policies and
procedures. This preliminary assessment for financial audits is
discussed further at FAM 270 (Determine Likelihood of Effective
Information System Controls). Based on the preliminary assessment, the
auditor should make any adjustments, as necessary, to the IS risk
level, critical control points, and planned scope of the audit work.
Control activities for critical elements in each general control and
business process control category are described in Chapters 3 and 4,
respectively, and summarized in Appendix II. The auditor may use the
summary tables in Appendix II, which are also available in electronic
form from GAO [hyperlink, http://www.gao.gov], to document preliminary
findings and to assist in making the preliminary assessment of
controls. As the audit progresses through testing of internal controls,
the auditor may continue to use the electronic version of the tables to
document controls evaluated and tested, test procedures performed,
conclusions, and supporting documentation references.
The auditor should include the following information in the
documentation of their preliminary understanding of the design of IS
controls, to the extent relevant to the audit objectives:
* An identification of relevant entitywide, system, and business
process application level controls designed to achieve the control
activities for each critical element within each general control area
and a determination of whether they are designed effectively and
implemented (placed in operation), including identification of control
activities for which there are no or ineffective controls at the
entitywide level and the related risks.
* Identification of business process controls for key applications
identified as key areas of audit interest, determination of where those
controls are implemented within the entity�s systems, and the auditor�s
conclusion about whether the controls are designed effectively and
implemented (placed in operation), including identification of control
activities for which there are no or ineffective controls and the
related risks and the potential impact of any identified design
weaknesses on the completeness, accuracy, validity, and confidentiality
of application data.
* Any internal or third-party information systems reviews, audits, or
specialized systems testing (e.g., penetration tests, disaster recovery
tests, and application-specific tests) performed during the last year
and the auditor�s evaluation of the other auditor�s objectivity,
competence and conclusions.
* Management�s plans of action and milestones, or their equivalent,
that identify corrective actions planned to address known IS control
weaknesses.
* Status of the prior years� audit findings.
* Documentation for any significant computer security related incidents
identified and reported for the last year.
* Documented security plans.
* Documented risk assessments for relevant systems (e.g., general
support systems and major applications).
* System certification and accreditation documentation or equivalent
for relevant systems.
* Documented business continuity of operations plans and disaster
recovery plans.
* A description of the entity�s use of third-party IT services.
The auditor should obtain information from relevant reports and other
documents concerning IS that are issued by or about the entity,
including:
* the entity�s prior FISMA or equivalent reports on IS;
* the entity�s annual performance and accountability report or
equivalent reports on performance including reports filed to comply
with the Federal Financial Management Improvement Act of 1996 [Footnote
20] (FFMIA) and Federal Managers Financial Integrity Act of 1982
[Footnote 21] (FMFIA);
* other reports by management or the auditor about IS;
* other reports that contain information concerning IS that are
relevant to the audit objectives;
* GAO reports;
* IG and internal audit reports (including those for performance audits
and other reviews); and;
* consultant reports.
2.1.9 Perform Other Audit Planning Procedures:
The auditor should address the following areas during the planning
phase, even though related audit procedures may be applied during the
other phases. More specifically, the auditor should address any other
issues, not identified in the previous steps, that could affect the
objectives, scope, or methodology of the IS controls audit, including:
* relevant laws and regulations;
* the risk of fraud;
* staffing and other resources needed to perform the audit;
* multiyear testing plans;
* communication to management officials and those charged with
governance concerning the planning and performance of the audit, and to
others as applicable;
* use of service organizations;
* using the work of others; and;
* preparation of an audit plan (and an audit strategy for financial
statement audits).
2.1.9.A Relevant Laws and Regulations:
The auditor should identify applicable laws and regulations that are
relevant to IS at the entity. Such laws and regulations may establish
general or specific IS control requirements or criteria. Laws and
regulations generally relevant to audits of federal agencies include
FISMA, FMFIA, FFMIA, Appendix III of OMB Circular A-130,[Footnote 22]
OMB Circular A-123,[Footnote 23] and FISMA implementing guidance.
Specific federal laws and regulations that may affect the entity
include:
* Health Insurance Portability and Accountability Act of 1996
(HIPAA),[Footnote 24];
* Gramm-Leach-Bliley,[Footnote 25];
* Requirements for information security for Medicare Administrative
Contractors,[Footnote 26];
* Chief Privacy Officer statutory requirements,[Footnote 27];
* OMB Memorandum M-05-08, Designation of Senior Agency Officials for
Privacy, and[Footnote 28];
* OMB Memorandum M-06-19, Reporting Incidents Involving Personally
Identifiable Information.[Footnote 29]
* OMB Memorandum M 07-16, Safeguarding Against and Responding to the
Breach of Personally Identifiable Information.[Footnote 30]
In IS controls audits of state and local governments, the auditor
should identify applicable legal and reporting requirements and issues.
Further information specifically related to audits of state and local
government entities can be obtained from the National Association of
State Auditors, Comptrollers and Treasurers (NASACT).[Footnote 31]
Under GAGAS, the auditor should design and perform procedures to
provide reasonable assurance of detecting instances of violations of
legal and regulatory requirements that are significant within the
context of the audit objectives. Consequently, if one of the objectives
of the audit is to determine whether the entity violated specific laws
or regulations, the auditor should plan the audit to detect significant
violations of such laws or regulations. In financial audits, the
auditor should test those laws and regulations that could have a direct
and material effect on the financial statements.
As part of an IS controls audit, the auditor�s findings will typically
be reported in terms of whether IS controls are effective. While such
general laws and regulations as FISMA, FMFIA, FFMIA, and OMB guidance
provide requirements and criteria for assessing IS, IS controls audit
objectives generally are not focused on detecting violations of such
laws and regulations, but rather on assessing controls and identifying
any control weaknesses. Consequently, such laws and regulations
generally would not be considered significant to the audit objectives
for the purposes of designing compliance tests to meet GAGAS. However,
audit objectives may sometimes include specific objectives to determine
compliance with such laws, in which case such laws and regulations
would be significant. Also, other laws such as HIPAA, which provide for
potential penalties, may be significant to the audit objectives.
2.1.9.B Consideration of the Risk of Fraud:
In audits performed under GAGAS, the auditor should assess the risks of
fraud [Footnote 32] occurring that is significant within the context of
the audit objectives (for financial audits, a material misstatement).
Auditors should gather and assess information to identify risks of
fraud that are significant within the scope of the audit objectives or
that could affect the findings or conclusions. When auditors identify
factors or risks related to fraud that has occurred or is likely to
have occurred that they believe are significant within the context of
the audit objectives, they should design procedures to provide
reasonable assurance of detecting such fraud. In financial audits,
GAGAS indicates that auditors should assess the risk of material
misstatements of financial statement amounts or other financial data
significant to the audit objectives due to fraud and to consider that
assessment in designing the audit procedures to be performed.[Footnote
33] The auditor�s responsibilities with respect to the risk of fraud in
financial statement audits are discussed further in the GAGAS and in
the AICPA�s Auditing Standards Board Statement on Auditing Standards
No. 99, titled Consideration of Fraud in a Financial Statement Audit,
as amended (AU section 316).
If the IS controls audit is performed as part of a broader financial or
performance audit, the auditor should coordinate with the audit team in
the identification of and response to the risk of fraud. The auditor
should be aware of fraud risks identified by the overall audit team and
communicate any fraud risks or suspected fraud associated with IT to
the overall audit team. Also, the overall audit team may identify audit
procedures to be performed by the IS controls specialist to detect
fraud significant to the audit.
The audit team should hold a brainstorming session at the start of the
audit to discuss potential fraud risks, fraud factors such as
individuals� incentives or pressures to commit fraud, the opportunity
for fraud to occur, and rationalizations or attitudes that could allow
individuals to commit fraud. For example, the following factors related
to IS may indicate a risk of fraud:
* failure to provide an adequate security management program, including
inadequate monitoring of control effectiveness;
* weaknesses in access and other IS controls that could allow overrides
of internal controls or access to systems susceptible to fraud (e.g.,
payment systems);
* lack of adequate segregation of duties;[Footnote 34] and;
* pervasive or long-standing IS control weaknesses.
The auditor should gather and assess information necessary to identify
fraud risks that could be relevant to the audit objectives or affect
the results of their audit. For example, the auditor may obtain
information through discussion with officials of the audited entity or
through other means to determine the susceptibility of the program to
fraud, the status of internal controls the entity has established to
detect and prevent fraud, or the risk that officials of the audited
entity could override internal control. The auditor should exercise
professional skepticism in assessing these risks to determine which
factors or risks could significantly affect the results of their work
if fraud has occurred or is likely to have occurred.
When the auditor identifies factors or risks related to fraud that they
believe are significant within the context of the audit objectives or
the results of the audit, they should design procedures to provide
reasonable assurance of detecting such fraud. The auditor should
prepare audit documentation related to their identification and
assessment of and response to fraud risks.
Assessing the risk of fraud is an ongoing process throughout the audit
and relates not only to planning the audit but also to evaluating
evidence obtained during the audit. When testing general and business
process application level controls, the auditor should be alert for
information or other conditions that indicate fraud that is significant
within the context of the audit objectives may have occurred.
A specific area of concern for fraud is override of controls,
particularly in ERP applications. Because ERP applications are by their
nature highly integrated, the potential risk of management override of
controls is heightened. The audit generally should include procedures
to identify system-based overrides. These procedures might include
testing for instances of users performing inappropriate combinations of
transactions (i.e., transactions that should have been segregated) and
other similar procedures. Some examples of antifraud controls to
consider include: workflow approvals, restricting access to sensitive
files, segregation of duties, review of audit trails, and review of key
management reports. Access controls, segregation of duties, and audit
trails are discussed in Chapter 3.
The auditor should also evaluate situations or transactions that could
be indicative of fraud. When information comes to the auditors�
attention (through audit procedures, allegations received through fraud
hotlines, or other means) indicating that fraud may have occurred, the
auditor should evaluate whether the possible fraud could significantly
affect the audit results. If the fraud could significantly affect the
audit results, auditors should modify the audit steps and procedures,
as necessary, to (1) determine if fraud likely has occurred and (2) if
so, determine its effect on the audit results.
The auditor�s training, experience, and understanding of the program
being audited may provide a basis for recognizing that some acts coming
to his or her attention may be indicative of fraud. Whether an act is,
in fact, fraud is a determination to be made through the judicial or
other adjudicative system and is beyond auditors� professional
expertise and responsibility. However, the auditor is responsible for
being aware of vulnerabilities to fraud associated with the area being
audited to identify indications that fraud may have occurred.
2.1.9.C Audit Resources:
As with other types of audits, the staff assigned to perform the IS
controls audit must collectively possess adequate professional
competence. Therefore, it is important to carefully plan IS controls
audits to ensure that adequate and appropriate resources are available
to perform the audit. IS controls audits need a broad range of
technical skills. In addition to skills necessary to assess each
control category, IS controls audits generally use technical
specialists with skills in such areas as networks, Windows/Novell,
Unix, data management systems, and mainframe system and access control
software. See Appendix V for a discussion of typical skill sets for IS
controls specialists. Based on the knowledge obtained during audit
planning, the auditor should identify resource requirements and
determine whether internal resources are available or whether
contractors will be necessary to complete the audit. The auditor should
then schedule the resources for the appropriate periods of time.
Regardless of the size of the entity, the auditor must still perform
the necessary planning to ensure that audit requirements are fully
satisfied. This includes small/independent agencies which generally
have a less complex, less risky IS control environment, which requires
inherently fewer IS controls audit resources. The Committee of
Sponsoring Organizations (COSO)[Footnote 35] publication �Internal
Controls over Financial Reporting � Guidance for Smaller Public
Companies� includes guidance that could be used by smaller agencies in
planning their audits.
The auditor may determine that it is necessary to contract for audit
services for all or a portion of the IS controls audit. For example,
the auditor may determine that it is necessary to contract only for
certain technical skills needed to perform the audit. Contracting for
audit services offers two significant benefits to an entity�s audit
organization�it allows audit coverage beyond that possible with the
existing audit staff level, and it allows the audit activity to address
technical and other issues in which the in-house staff is not skilled.
Engagements that employ contractors in this way may help train in-house
staff for future audits. However, when contracting for audit services,
some in-house audit personnel generally should be actively involved.
For example, the audit organization should be instrumental in
determining the scope of the contracted services, and in developing the
task order or request for proposal for the work. The FISCAM may be
required to be used as a basis for the work to be performed.
Also, an auditor generally should be designated to monitor the contract
for the entity. The contract monitor should have sufficient knowledge
of IS controls to monitor and to assess the quality and adequacy of the
work performed by the contractor, including the adequacy of the audit
documentation. The contract monitor should discuss the contract with
the contractor, including the product deliverables, the established
time frames for deliverables, and documentation standards to adhere to.
The auditor generally should hold this meeting before the contractor
begins work. In addition, the contract monitor should attend critical
meetings the contractor has with entity representatives, including the
opening and close-out meetings.
The contract monitor should conduct a technical review of the work
performed and may use this manual as guidance to determine whether the
work addressed relevant issues and the audit procedures were adequate.
For financial audits, the contract monitor may reperform some tests in
accordance with FAM 650, �Using the Reports and Work of Others.� Also,
the contract monitor should review the audit report and supporting
audit documentation to determine whether the audit report is adequately
supported.
2.1.9.D Multiyear Testing Plans:
In circumstances where the auditor regularly performs IS controls
audits of the entity (as is done, for example, by an IG or for annual
financial audits), the auditor may determine that a multiyear plan for
performing IS controls audits is appropriate. Such a plan will cover
relevant key agency applications, systems, and processing centers .
These strategic plans should cover no more than a 3-year period and
include the schedule and scope of assessments to be performed during
the period and the rationale for the planned approach. The auditor
typically evaluates these plans annually and adjusts them for the
results of prior and current audits and significant changes in the IT
environment, such as implementation of new systems.
Multiyear testing plans can help to assure that all agency systems and
locations are considered in the IS control evaluation process, to
consider relative audit risk and prioritization of systems, and to
provide sufficient evidence to support an assessment of IS control
effectiveness, while helping to reduce annual audit resources under
certain conditions. When appropriate, this concept allows the auditor
to test computer-related general and business process application
controls on a risk basis rather than testing every control every year.
Under a multiyear testing plan, different controls are comprehensively
tested each year, so that each significant general and business process
control is selected for testing at least once during the multiyear
period, which should not be more than 3 years. For example, a multiyear
testing plan for an entity with five significant business process
applications might include comprehensive tests of two or three
applications annually, covering all applications in a 2 or 3 year
period. For systems with high IS risk, the auditor generally should
perform annual testing.
Such multiyear testing plans are not appropriate in all situations. For
example, they are not appropriate for first-time audits, for audits
where some significant business process applications or general
controls have not been tested within a sufficiently recent period (no
more than 3 years), or for audits of entities that do not have strong
entitywide controls. Also, using this concept, the auditor performs
some limited tests and other activities annually for general and
business process controls not selected for full testing; examples of
such activities include updating the auditor�s understanding of the
control environment, inquiring about control changes, and conducting
walk-throughs. For example, because of the importance of system level
critical control points, the auditor generally updates the
understanding of these yearly through limited tests. Multiyear testing
is discussed in greater detail in FAM section 395 G: �Multiyear Testing
of Controls.�
2.1.9.E Communication with Entity Management and Those Charged with
Governance:
The auditor should communicate information about the audit to
appropriate entity management and those charged with governance. The
auditor should document this communication, usually with an engagement
letter. This step is particularly important in an IS controls audit
because of the sensitivity of entity information systems and the nature
of tests performed. Multiple meetings may be necessary with various
levels of management so that they are adequately aware of the audit
process. GAGAS requires that to help the various parties involved in
the audit understand the audit objectives, time frames, and any data
needs, the auditor should provide them with information about the
specific nature of the audit, as well as general information concerning
the planning and conduct of the audit and reporting.
As part of this communication, it may be useful to provide general
protocols for conducting the IS controls audit. Such protocols might
include the following:
* Define the scope of the engagement. This might include an overview of
the audit objectives, information about what is to be tested, when
testing will occur, where and from what locations testing will be
performed, who will be performing and monitoring the testing, and how
the testing will be performed (for example, the methodology and tools
that will be employed). However, it is important to not disclose
detailed audit procedures so that the tests become ineffective.
* Communicate risks and steps taken by management to manage such risks.
While risks cannot be eliminated entirely, they can be managed to an
acceptable level to avoid, or at least minimize, service degradation or
interruption. Auditors can communicate actions they have taken to
minimize risks such as (a) not performing denial-of-service testing,
(b) coordinating testing with the audited site, (c) having
knowledgeable personnel from the audited site monitoring all testing,
(d) testing the tools that will be used and gaining expertise in their
use, (e) logging test parameters, (f) logging testing and results, (g)
using network analyzers to monitor loads placed on the network during
testing, and (h) performing testing during nonpeak hours, if possible.
* Identify roles and responsibilities. Address the roles and
responsibilities of each participant. Participants will likely include
the test team, the auditors, the system owners, the systems security
officer, the systems administrators, and contractors, if applicable.
* Address logistical requirements. Logistical requirements would
include information about such items as the organization�s range of
Internet Protocol addresses and telephone numbers (particularly
sensitive numbers that should be excluded from testing), analog
telephone lines, wireless connections, Internet access paths, policies
governing user accounts and passwords, etc. On-site workspace
arrangements and agency points of contact might also be addressed.
GAGAS requires certain communications with management, those charged
with governance, and others. For financial audits, see AU 380 and GAGAS
4.06. For performance audits, see GAGAS 7.46-7.48. In situations in
which those charged with governance are not clearly evident, auditors
should document the process followed and conclusions reached for
identifying those charged with governance.
2.1.9.F Service Organizations:
When IS controls, which are significant to a GAGAS audit, are performed
by a service organization external to the audited entity, the auditor
should determine how to obtain sufficient, appropriate evidence about
the operating effectiveness of such controls. The auditor should
coordinate these procedures with the audit procedures performed in
support of critical element SM-7 �Ensure That Activities Performed by
External Third Parties are Adequately Secure�. For example, the auditor
should determine how management of the audited entity monitors the
effectiveness of IS controls at the service organization, such as
through the receipt and analysis of a service auditor (SAS 70) report.
SAS 70 reports are discussed in more detail in Appendix VII. If the
auditor uses a SAS 70 report, the auditor is responsible for
determining whether SAS 70 report provides sufficient evidence about
the operating effectiveness of IS controls performed by the service
organization that are significant to the audit. Also, see section
2.1.9.G below. If IS controls are performed by service organizations,
the auditor should document conclusions whether such controls are
significant to the audit objectives and any audit procedures performed
with respect to such controls (e.g., review of service auditor
reports).
The auditor should integrate evidence obtained about the operating
effectiveness of service auditor controls into the IS controls audit.
For example, the auditor should evaluate the effectiveness of IS
controls for the combination of IS controls at the audited entity and
at the service organization collectively. The preparation and use of
service auditor reports are discussed further in Appendix VII,
including how to determine whether the service auditor report contains
sufficient, appropriate evidence.
2.1.9.G Using the Work of Others:
The auditor may be able to use the work of the other auditors to
support findings or conclusions for the current audit. If auditors use
the work of other auditors, they should perform procedures that provide
a sufficient basis for using that work. For financial audits, further
information on using the work of other auditors is discussed in FAM 650
and AU 336. For performance audits, as discussed in GAGAS 7.41-.43,
auditors should obtain evidence concerning the other auditors�
qualifications and independence and should determine whether the scope,
quality, and timing of the audit work performed by the other auditors
is adequate for reliance in the context of the current audit
objectives. Procedures that auditors may perform in making this
determination include reviewing the other auditors� report, audit plan,
or audit documentation, and/or performing tests of the other auditors�
work. The nature and extent of evidence needed will depend on the
significance of the other auditors� work to the current audit
objectives and the extent to which the auditors will use that work.
As discussed in GAGAS 7.43, some performance audits may necessitate the
use of specialized techniques or methods that require the skills of a
specialist. If auditors intend to use the work of specialists, they
should obtain an understanding of the qualifications and independence
of the specialists. (See GAGAS paragraph 3.05 for independence
considerations when using the work of others.) Evaluating the
professional qualifications of the specialist involves the following:
a. the professional certification, license, or other recognition of the
competence of the specialist in his or her field, as appropriate;
b. the reputation and standing of the specialist in the views of peers
and others familiar with the specialist�s capability or performance;
c. the specialist�s experience and previous work in the subject matter;
and;
d. the auditors� prior experience in using the specialist�s work.
If the auditor plans to use the work of others, the auditor should
document conclusions concerning the planned use of the work of others
and any audit procedures performed with respect to using the work of
others.
2.1.9.H Audit Plan:
The auditor should prepare a written audit plan for each audit. The
auditor should describe the objectives, scope, and methodology for the
IS controls audit. The auditor should include planning information,
discussed in the preceding sections of this chapter. If the IS controls
audit is a component of a performance audit or attestation engagement,
the auditor should integrate such information, as appropriate, into the
overall audit plan. If the IS controls audit is a component of a
financial audit, the auditor should integrate such information, as
appropriate, with the overall audit strategy and audit plan for the
financial audit. Additionally, the auditor generally should use the IS
controls audit plan as a tool to communicate with the audit team. If
the auditor believes that another auditor will use his or her work, the
auditor may use the plan to coordinate with the other auditor.
In planning the audit, the auditor generally will first assess the
effectiveness of entitywide and system level general controls prior to
testing business process application level controls, unless the purpose
of the audit is to identify control weaknesses in the application area.
Without effective entitywide and system level general controls,
business process application level controls may be rendered ineffective
by circumvention or modification. Consequently, if general controls are
not designed or operating effectively, the auditor may conclude that
assessing business process application level controls is not efficient
or necessary to achieve the audit objectives. In such cases, the
auditor should develop appropriate findings and consider the nature and
extent of risks and their effect on the audit objectives and the
nature, timing, and extent of audit procedures. However, if an audit
objective is to identify control weaknesses within a business process
application, an assessment of the business process application level
controls may be appropriate. Also, testing of business process
application level controls may be warranted when the auditor finds
general control weaknesses mainly in areas with a relatively
insignificant impact on business process controls and the key areas of
audit interest, but not in more significant areas.
GAGAS require that a written audit plan be prepared for each
performance audit. The form and content of the written audit plan may
vary among audits and may include an audit strategy, audit program,
project plan, audit planning paper, or other appropriate documentation
of key decisions about the audit objectives, scope, and methodology and
of the auditor�s basis for these decisions. The auditor should update
the plan, as necessary, to reflect any significant changes to the plan
made during the audit. GAGAS include financial audit planning
documentation standards.
2.1.10 Documentation of Planning Phase:
The auditor should document the following information developed in the
planning phase:
* Objectives of the IS audit IS controls audit and, if it is part of a
broader audit, a description of how such objectives support the overall
audit objectives.
* The scope of the IS audit IS controls audit.
* The auditor�s understanding of the entity�s operations and key
business processes, including, to the extent relevant to the audit
objectives, the following:
- The significance and nature of the programs and functions supported
by information systems;
- Key business processes relevant to the audit objectives, including
business rules, transaction flows, and application and software module
interaction;
- Significant general support systems and major applications that
support each key process;
- Background information request, if used;
- Significant internal and external factors that could affect the IS
auditIS controls audit objectives;
- Detailed organization chart, particularly the IT and the IS
components;
- Significant changes in the IT environment/architecture or significant
applications implemented within the past 2 years or planned within the
next 2 years; and;
- The entity�s reliance on third parties to provide IT services (e.g.,
in-house, remote connectivity, remote processing).
* A general understanding of the structure of the entity�s or
component�s networks as a basis for planning the IS auditIS controls
audit, including high-level and detailed network schematics relevant to
the audit objectives.
* Key areas of audit interest, including relevant general support
systems and major applications and files. This includes (1) the
operational locations of each key system or file, (2) significant
components of the associated hardware and software (e.g., firewalls,
routers, hosts, operating systems), (3) other significant systems or
system-level resources that support the key areas of audit interest,
and (4) prior audit problems reported. Also, the auditor should
document all access paths in and out of the key areas of audit
interest.
* Factors that significantly increase or decrease IS risk and their
potential impact on the effectiveness of information system controls.
For each risk identified, the auditor should document the nature and
extent of the risk; the conditions that gave rise to that risk; and the
specific information or operations affected (if not pervasive).
* Preliminary assessment of IS risks related to the key areas of audit
interest and the basis for the assessed risk. For each risk identified,
the auditor should document the nature and extent of the risk; the
conditions that gave rise to that risk; and the specific information or
operations affected (if not pervasive). The auditor should also
document other considerations that may mitigate the effects of
identified risks.
* Critical control points.
* A preliminary understanding of the entity�s IS controls, including
the organization, staffing, responsibilities, authorities, and
resources of the entity�s security management function. The auditor
should include the following information in the documentation of their
preliminary understanding of the design of IS controls, to the extent
relevant to the audit objectives:
- Identification of entitywide level controls (and appropriate system
level controls) designed to achieve the control activities for each
critical element within each general control area and a determination
of whether they are designed effectively and implemented (placed in
operation), including identification of control activities for which
there are no or ineffective controls at the entitywide level and the
related risks;
- Identification of business process level controls for key
applications identified as key areas of audit interest, determination
of where those controls are implemented (placed in operation) within
the entity�s systems, and the auditor�s conclusion about whether the
controls are designed effectively, including identification of control
activities for which there are no or ineffective controls and the
related risks and the potential impact of any identified design
weaknesses on the completeness, accuracy, validity, and confidentiality
of application data;
- Any internal or third-party information systems reviews, audits, or
specialized systems testing (e.g., penetration tests, disaster recovery
tests, and application-specific tests) performed during the last year;
- Management�s plans of action and milestones, or their equivalent,
that identify corrective actions planned to address known IS weaknesses
IS control weaknesses;
- Status of the prior years� audit findings;
- Documentation for any significant computer security related incidents
identified and reported for the last year;
- Documented security plans;
- Documented risk assessments for relevant systems (e.g., general
support systems and major applications);
- System certification and accreditation documentation or equivalent
for relevant systems;
- Documented business continuity of operations plans and disaster
recovery plans; and;
- A description of the entity�s use of third-party IT services.
* Relevant laws and regulations and their relation to the audit
objectives.
* Description of the auditor�s procedures to consider the risk of
fraud, any fraud risk factors that the auditor believes could affect
the audit objectives, and planned audit procedures to detect any fraud
significant to the audit objectives.
* Audit resources planned.
* Current multiyear testing plans.
* Documentation of communications with entity management.
* If IS controls are performed by service organizations, conclusions
whether such controls are significant to the audit objectives and any
audit procedures performed with respect to such controls (e.g., review
of service auditor reports)
* If the auditor plans to use the work of others, conclusions
concerning the planned use of the work of others and any audit
procedures performed with respect to using the work of others.
* Audit plan that adequately describes the objectives, scope, and
methodology of the audit.
* Any decision to reduce testing of IS controls due to the
identification of significant IS control weaknesses.
2.2 Perform Information System Controls Audit Tests:
2.2.1 Overview:
In the testing phase of the IS controls audit, the auditor uses
information obtained in the planning phase to test the effectiveness of
IS controls that are relevant to the audit objectives. As audit
evidence is obtained through performing control testing, the auditor
should reassess the audit plan and consider whether changes are
appropriate.
While determining whether IS controls are appropriately designed and
implemented and while performing tests of IS controls, the auditor
should periodically assess the cumulative audit evidence obtained to
identify any revisions needed to the audit plan. For example, if
significant weaknesses have been identified, the auditor may decide to
perform less testing in remaining areas if audit objectives have been
achieved. Conversely, the performance of tests may uncover additional
areas to be tested. For those IS controls that the auditor determines
are properly/suitably designed and implemented, the auditor determines
whether to perform tests of the operating effectiveness of such
controls. In determining whether to test the operating effectiveness of
IS controls, the auditor should determine whether it is possible and
practicable to obtain sufficient, appropriate audit evidence without
testing IS controls. For federal financial statement audits and for
single audits (compliance requirements), the auditor is required to
test controls that are suitably designed and implemented to achieve a
low assessed level of control risk.
As discussed in Chapter 1, this manual is organized in a hierarchical
structure to assist the auditor in performing the IS controls audit.
Chapter 3 provides information concerning the general controls, and
Chapter 4 provides information concerning four business process
application level controls. Each of the chapters contains several
control categories, which are groupings of related controls pertaining
to similar types of risk. For each control category, this manual
discusses the key underlying concepts and associated risks if the
controls in the category are ineffective.
Chapter 3 is organized by five general control categories:
* security management,
* access controls,
* configuration management,
* segregation of duties, and,
* contingency planning.
Chapter 4 is organized into four business process application level
control categories:
* business process application level general controls [Footnote 36]
(also referred to as application security),
* business process controls,
* interface and conversion controls, and,
* data management systems controls.
The last three business process application level control categories
are collectively referred to as �business process application
controls.�
For each control category, the manual identifies critical
elements�tasks that are essential for establishing adequate controls
within the category. For each critical element, there is a discussion
of the associated objectives, risks, and control activities, as well as
related potential control techniques and suggested audit procedures.
This hierarchical structure facilitates the auditor�s analysis of
identified control weaknesses.
Within each relevant control activity, the auditor should identify
control techniques implemented by the entity and determine whether the
control techniques, as designed, are sufficient to achieve the control
activity. If sufficient, the auditor should determine whether the
control techniques are implemented (placed in operation) and are
operating effectively. Also, the auditor should evaluate the nature and
extent of testing performed by the entity. Such information can assist
in identifying key controls and in assessing risk, but the auditor
should not rely on testing performed by the entity in lieu of
appropriate auditor testing. As discussed later in this section, if the
control techniques implemented by the entity, as designed, are not
sufficient to address the control activity, or the control techniques
are not effectively implemented as designed, the auditor should
determine the effect on IS controls and the audit objectives.
The auditor identifies control techniques and determines the
effectiveness of controls at each of the following levels:
* Entitywide or component level.(general controls) Controls at the
entity or component level consist of the entitywide or componentwide
processes designed to achieve the control activities. They are focused
on how the entity or component manages IS related to each general
control activity in Chapter 3. For example, the entity or component may
have an entitywide process for configuration management, including
establishment of accountability and responsibility for configuration
management, broad policies and procedures, development and
implementation of monitoring programs, and possibly centralized
configuration management tools. The absence of entitywide processes may
be a root cause of weak or inconsistent controls, by increasing the
risk that IS controls are not applied consistently across the
organization.
* System level (general controls). Controls at the system level consist
of processes for managing specific system resources related to either a
general support system or major application. These controls are more
specific than those at the entity or component level and generally
relate to a single type of technology. Within the system level are
three further levels that the auditor should assess: network, operating
system, and infrastructure application. The three sublevels can be
defined as follows:
- Network. A network is an interconnected or intersecting configuration
or system of components. For example, a computer network allows
applications operating on various computers to communicate.
- Operating system. An operating system is software that controls the
execution of computer programs and may provide various services. For
example, an operating system may provide services such as resource
allocation, scheduling, input/output control, and data management.
- Infrastructure applications. Infrastructure applications are software
that is used to assist in performing systems operations, including
management of network devices. These applications include databases, e-
mail, browsers, plug-ins, utilities, and applications not directly
related to business processes.
For example, infrastructure applications allow multiple processes
running on one or more machines to interact across a network. For an
example of the identification of system level controls, take
configuration management. The auditor who is evaluating configuration
management at the system level should determine whether the entity has
applied appropriate configuration management practices for each
significant type of technology (e.g., firewalls, routers) in each of
the three sublevels (e.g., specific infrastructure applications). Such
configuration management practices typically include standard
configuration guidelines for the technology and tools to effectively
determine whether the configuration guidelines are effectively
implemented.
* Business process application level. Controls at the business process
application level consist of policies and procedures for controlling
specific business processes. For example, the entity�s configuration
management should reasonably ensure that all changes to application
systems are fully tested and authorized.
Chapter 3 includes general control activities that are applicable to
the entitywide and system levels, and Chapter 4 includes the general
controls applied at the business process application level (also
referred to as application security) as well as the three categories of
business process application controls. The control techniques for
achieving the control activities and the related audit tests vary
according to the level to which they are being applied. However, they
are described at a high level in this manual, and these descriptions
assume some expertise about the subject to be effectively performed.
Thus, the auditor should develop more detailed audit steps based on the
entity�s specific software and control techniques, after consulting
with the financial or performance auditor about audit objectives and
significant areas of audit interest. This manual lists specific control
activities and techniques and related suggested audit procedures. Table
1 shows the control categories applicable at each level.
Table 1: Control Categories Applicable at Different Levels of Audit:
General Controls:
Control Categories: Security Management:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Access Controls:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Configuration Management:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Segregation of Duties:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Contingency Planning:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Business Process Application Controls:
Control Categories: Business Process Controls:
Entitywide/Component Level: Not applicable;
System Level, Network: Not applicable;
System Level, Operating Systems: Not applicable;
System Level, Infrastructure Applications: Not applicable;
Business Process Application Level: Applicable.
Control Categories: Interfaces:
Entitywide/Component Level: Not applicable;
System Level, Network: Not applicable;
System Level, Operating Systems: Not applicable;
System Level, Infrastructure Applications: Not applicable;
Business Process Application Level: Applicable.
Control Categories: Data Management Systems:
Entitywide/Component Level: Not applicable;
System Level, Network: Not applicable;
System Level, Operating Systems: Not applicable;
System Level, Infrastructure Applications: Not applicable;
Business Process Application Level: Applicable.
Source: GAO.
[Ed of table]
The auditor should evaluate the effectiveness of IS controls including
system and/or application level controls related to each critical
control point. The auditor should evaluate all potential ways in which
the critical control point could be accessed. Generally, for each
critical control point, this would include assessing controls related
to the network, operating system, and infrastructure application
components. For example, if a particular router was deemed to be a
critical control point, the auditor generally should test controls
related to the router itself (a network component), its operating
system, and the infrastructure application that is used to manage the
router. Access to any of these could lead to access to the control
point. See the discussion of control dependencies in the above section
entitled �Identify Critical Control Points�.
As discussed in audit planning (section 2.1.2), the auditor determines
the appropriate scope of the IS controls audit, including:
* the organizational entities to be addressed (e.g., entitywide,
selected component(s), etc.);
* the breadth of the audit (e.g., overall conclusion on IS control
effectiveness, review of a specific application or technology area,
such as wireless or UNIX, etc.);
* the types of IS controls to be tested:
* general and/or business process application level controls to be
tested, or selected components; or;
* all levels of the entity�s information systems, or selected levels
(e.g., entitywide, system level, or business process application level,
or selected components of them.
The auditor should perform the following procedures as part of testing
the effectiveness of information system controls:
* Understand information systems relevant to the audit objectives,
building on identification of key areas of audit interest and critical
control points.
* Determine which IS control techniques are relevant to the audit
objectives. The control categories, critical elements, and control
activities in Chapters 3 and 4 are generally relevant to all audits.
However, if the auditor is not performing a comprehensive audit, for
example, an application review, then there may be no need to assess
controls in Chapter 3.
* For each relevant IS control technique, determine whether it is
suitably designed to achieve the critical activity and has been
implemented -- placed in operation (if not done earlier).
* Perform tests to determine whether such control techniques are
operating effectively.
* Identify potential weaknesses in IS controls. For each potential
weakness, consider the impact of compensating controls or other factors
that mitigate or reduce the risks related to potential weaknesses.
Understand Information Systems Relevant to the Audit Objectives:
The auditor should obtain and document an understanding of the
information processing steps performed in information systems that are
significant to the audit objectives, including:
* The manner in which transactions are initiated;
* The nature and type of records and source documents;
* The processing involved from the initiation of transactions to their
final processing, including the nature of computer files and the manner
in which they are accessed, updated, and deleted; and;
* For financial audits, the process used to prepare the entity's
financial statements and budget information, including significant
accounting estimates, disclosures, and computerized processing.
This understanding builds on information obtained in audit planning
(e.g., identification of key areas of audit interest and critical
control points). For efficiency, the auditor may combine this step with
audit planning to aid in the identification of relevant controls. The
auditor should perform and document walk-throughs for all business
process applications that are significant to the audit objectives. Walk-
throughs are important for understanding the information processing and
for determining appropriate audit procedures.
Identify IS Control Techniques That Are Relevant to the Audit
Objectives:
Based on the results of audit planning and other procedures performed,
the auditor should identify the control categories, critical elements,
control activities, and control techniques that are relevant to the IS
audit. In doing this, the auditor considers the audit objectives and
audit scope, the extent of IS risk and the preliminary understanding of
IS controls. The process for identifying relevant control techniques is
summarized below.
For IS audits that are stand alone GAGAS audits, generally all of the
control categories, critical elements, and control activities are
relevant to the audit objectives, unless specifically not part of the
audit objectives. For example, in an evaluation of the effectiveness of
business process controls in a specific application, the general
controls in Chapter 3 may or may not be part of the audit objectives.
At the entitywide level and for each critical control point (including
control dependencies) at the system and business process application
levels, the auditor should identify and document the control techniques
used by the entity to achieve each relevant control activity. For
purposes of illustration, using the example of the router serving as a
critical control point (as discussed in section 2.1.7), the auditor
would identify and document the control techniques used by the entity
to achieve the control activities related to each relevant control
category and critical element for the router and for the related
control dependencies.
If the IS audit is part of a broader financial audit, performance
audit, or attestation engagement, the auditor should obtain, from the
overall audit team, audit documentation that identifies internal
controls that are significant to the audit objectives. For financial
audits performed under the FAM, such controls are identified in the SCE
form. For each internal control technique that is identified as
significant to the audit objectives (significant control technique),
the audit team should determine whether it is an IS control. An IS
controls specialist generally should review and concur with the audit
team�s identification of IS controls, particularly with respect to
whether all IS controls were properly identified as such.
The auditor should identify and document the other entitywide, system,
and business process level IS controls upon which the effectiveness of
each significant IS control technique depends. These other IS controls
will principally relate to the entitywide level controls and to
controls over each of the critical control points (including control
dependencies) at the system and business process application levels.
For example, if the IS control is the review of an exception report,
the auditor should identify and test the business process application
controls directly related to the production of the exception report, as
well as the general and other business process application controls
upon which the reliability of the information in the exception report
depends, including the proper functioning of the business process
application that generated the exception report and the reliability of
the data used to generate the exception report. In addition, the
auditor should test the effectiveness of the user control (i.e.,
management review and followup on the items in the exception report).
For each relevant IS control technique, the auditor should determine
whether it is (1) designed effectively to achieve the related control
activity, considering IS audit risk and the audit objectives, and (2)
implemented (placed in operation). The auditor may be able to determine
whether control techniques are sufficient to achieve a particular
control activity without evaluating and testing all of the control
techniques. Also, depending on IS audit risk and the audit objectives,
the nature and extent of control techniques necessary to achieve a
particular control objective will vary.
The auditor generally should evaluate the design effectiveness and test
only the control techniques necessary to achieve the relevant audit
activities. For example, if there are two control techniques, each of
which individually would achieve the control activity, the auditor
generally would evaluate and test only one control technique. However,
if the auditor determines that the control technique evaluated and
tested was not effective, the auditor would consider the effectiveness
of the other control technique.
Also, the auditor should evaluate the nature and extent of testing
performed by the entity. Such information can assist in identifying key
controls and in assessing risk, but the auditor should not rely on
testing performed by the entity in lieu of appropriate auditor testing.
If the control techniques implemented by the entity, as designed, are
not sufficient to address the control activity, or the control
techniques are not effectively implemented as designed, the auditor
should determine the effect on IS controls and the audit objectives.
For efficiency, the auditor may implement a tiered approach to the
identification and evaluation of the design effectiveness of relevant
IS control techniques, as discussed later in this session, beginning
with entitywide level controls, followed by system level controls, then
by business process application level controls.
Appendices II and III may be used to identify and summarize relevant IS
controls at the entitywide, system, and business process application
levels.
Test Information System Controls:
The auditor should design and conduct tests of relevant control
techniques that are effective in design to determine their
effectiveness in operation.
It is generally more efficient for the auditor to test IS controls on a
tiered basis, starting with the general controls at the entitywide and
system levels, followed by the general controls at the business process
application level, and concluding with tests of business process
application, interface, and data management system controls at the
business process application level. Such a testing strategy may be used
because ineffective IS controls at each tier generally preclude
effective controls at the subsequent tier.
If the auditor identifies IS controls for testing, the auditor should
evaluate the effectiveness of:
* general controls at the entitywide and system level;
* general controls at the business process application level; and;
* specific business process application controls (business process
controls, interface controls, data management system controls), and/or
user controls, unless the IS controls that achieve the control
objectives are general controls.
The auditor should determine whether entitywide and system level
general controls are effectively designed, implemented, and operating
effectively by:
* identifying applicable general controls;
* determining how those controls function, and whether they have been
placed in operation; and;
* evaluating and testing the effectiveness of the identified controls.
The auditor generally should use knowledge obtained in the planning
phase. The auditor should document the understanding of general
controls and should conclude whether such controls are effectively
designed, placed in operation, and, for those controls tested,
operating as intended.
Tests of General Controls at the Entitywide and System Levels:
The auditor may test general controls through a combination of
procedures, including observation, inquiry, inspection (which includes
a review of documentation on systems and procedures), and reperformance
using appropriate test software. Although sampling is generally not
used to test general controls, the auditor may use sampling to test
certain controls, such as those involving approvals.
If general controls at the entitywide and system levels are not
effectively designed and operating as intended, the auditor will
generally be unable to obtain satisfaction that business process
application-level controls are effective. In such instances, the
auditor should (1) determine and document the nature and extent of
risks resulting from ineffective general controls and (2) identify and
test any manual controls that achieve the control objectives that the
IS controls were to achieve.
However, if manual controls do not achieve the control objectives, the
auditor should determine whether any specific IS controls are designed
to achieve the objectives. If not, the auditor should develop
appropriate findings principally to provide recommendations to improve
internal control. If specific IS controls are designed to achieve the
objectives, but are in fact ineffective because of poor general
controls, testing would typically not be necessary, except to support
findings.
Tests of General Controls at the Business Process Application Level:
If the auditor reaches a favorable conclusion on general controls at
the entitywide and system levels, the auditor should evaluate and test
the effectiveness of general controls for those applications within
which business process application controls or user controls are to be
tested. These business process application level general controls are
referred to as Application Security (AS) controls in Chapter 4.
If general controls are not operating effectively within the business
process application, business process application controls and user
controls generally will be ineffective. If the IS controls audit is
part of a financial or performance audit, the IS controls specialist
should discuss the nature and extent of risks resulting from
ineffective general controls with the audit team. The auditor should
determine whether to proceed with the evaluation of business process
application controls and user controls.
Tests of Business Process Application Controls and User Controls:
The auditor generally should perform tests of those business process
application controls (business process, interface, data management),
and user controls necessary to achieve the control objectives where the
entitywide, system, and application-level general controls were
determined to be effective.
If IS controls are not likely to be effective, the auditor should
obtain a sufficient understanding of control risks arising from
information systems to:
* identify the impact on the audit objectives,
* design audit procedures, and,
* develop appropriate findings. Also, in such circumstances, the
auditor considers whether manual controls achieve the control
objectives, including manual controls that may mitigate weaknesses in
IS controls. If IS controls are not likely to be effective and if
manual controls do not achieve the control objectives, the auditor
should identify and evaluate any specific IS controls that are designed
to achieve the control objectives to develop recommendations for
improving internal controls.
IS controls that are not effective in design do not need to be tested.
If the auditor determined in a prior year that controls in a particular
accounting application were ineffective and if management indicates
that controls have not significantly improved, the auditor need not
test them.
2.2.2 Appropriateness of Control Tests:
To assess the operating effectiveness of IS controls, auditors should
perform an appropriate mix of audit procedures to obtain sufficient,
appropriate evidence to support their conclusions. Such procedures
could include the following:
* Inquiries of IT and management personnel can enable the auditor to
gather a wide variety of information about the operating effectiveness
of control techniques. The auditor should corroborate responses to
inquiries with other techniques.
* Questionnaires can be used to obtain information on controls and how
they are designed.
* Observation of the operation of controls can be a reliable source of
evidence. For example, the auditor may observe the verification of edit
checks and password controls. However, observation provides evidence
about controls only when the auditor was present. The auditor needs
other evidence to be satisfied controls functioned the same way
throughout the period.
* The auditor may review documentation of control polices and
procedures. For example, the entity may have written policies regarding
confidentiality or logical access. Review of documents will allow the
auditors to understand and assess the design of controls.
* Inspection of approvals/reviews provides the auditor with evidence
that management is performing appropriate control checks. The auditor
may combine these tests with discussions and observations.
* Analysis of system information (e.g., configuration settings, access
control lists, etc.) obtained through system or specialized software
provides the auditor with evidence about actual system configuration.
* Data review and analysis of the output of the application processing
may provide evidence about the accuracy of processing. For example, a
detailed review of the data elements or analytical procedures of the
data as a whole may reveal the existence of errors. Computer-assisted
audit techniques (CAAT) may be used to test data files to determine
whether invalid transactions were identified and corrected by
programmed controls. However, the absence of invalid transactions alone
is insufficient evidence that the controls effectively operated.
* Reperformance of the control could be used to test the effectiveness
of some programmed controls by reapplying the control through the use
of test data. For example, the auditor could prepare a file of
transactions that contains known errors and determine if the
application successfully captures and reports the known errors.
Based on the results of the IS controls audit tests, the auditor should
determine whether the control techniques are operating effectively to
achieve the control activities. Controls that are not properly designed
to achieve the control activities or that are not operating effectively
are potential IS control weaknesses. For each potential weakness, the
auditor should determine whether there are specific compensating
controls or other factors that could mitigate the potential weakness.
If the auditor believes that the compensating controls or other factors
could adequately mitigate the potential weakness and achieve the
control activity, the auditor should obtain evidence that the
compensating or other control is effectively operating and actually
mitigates the potential weakness. If it effectively mitigates the
potential weakness, the auditor can conclude that the control activity
is achieved; however, the auditor may communicate such weaknesses to
the entity. If the potential weakness is not effectively mitigated, the
potential weakness is an actual weakness. The auditor evaluates its
effects on IS controls in combination with other identified weaknesses
in the reporting phase.
2.2.3 Documentation of Control Testing Phase:
Information developed in the testing phase that the auditor should
document includes the following:
* An understanding of the information systems that are relevant to the
audit objectives;
* IS Control objectives and activities relevant to the audit
objectives;
* By level (e.g., entitywide, system, business process application) and
system sublevel (e.g., network, operating system, infrastructure
applications), a description of control techniques used by the entity
to achieve the relevant IS control objectives and activities;
* By level and sublevel, specific tests performed, including:
- related documentation that describes the nature, timing, and extent
of the tests;
- evidence of the effective operation of the control techniques or lack
thereof (e.g., memos describing procedures and results, output of tools
and related analysis);
- if a control is not achieved, any compensating controls or other
factors and the basis for determining whether they are effective;
- the auditor�s conclusions about the effectiveness of the entity�s IS
controls in achieving the control objective; and;
- for each weakness, whether the weakness is a material weakness,
significant deficiency or just a deficiency, as well as the criteria,
condition, cause, and effect if necessary to achieve the audit
objectives.
Appendices II and III may be used to summarize the results of testing.
2.3 Report Audit Results:
After completing the testing phase, the auditor summarizes the results
of the audit, draws conclusions on the individual and aggregate effect
of identified IS control weaknesses on audit risk and audit objectives
and reports the results of the audit. The auditor evaluates the
individual and aggregate effect of all identified IS control weaknesses
on the auditor�s conclusions and the audit objectives. The auditor
evaluates the effect of any weaknesses on the entity�s ability to
achieve each of the critical elements in Chapters 3 and 4 and on the
risk of unauthorized access to key systems or files. Also, the auditor
evaluates potential control dependencies.
For each critical element, the auditor should make a summary
determination as to the effectiveness of the entity�s related controls,
considering entitywide, system, and business process application levels
collectively. The auditor should evaluate the effect of related
underlying control activities that are not achieved. In addition, the
auditor should determine whether the weaknesses preclude the
effectiveness of each of the five categories of general controls or the
four categories of application-level controls. If the controls for one
or more of each category�s critical elements are ineffective, then the
controls for the entire category are not likely to be effective. The
auditor uses professional judgment in making such determinations. For
federal entities, if identified weaknesses relate to IS measures
reported in FISMA reporting, the auditor should determine whether they
were properly reported. Also, the auditor should determine whether IS
control weaknesses identified by the audit were identified in the
entity�s Plans of Action and Milestones (POA&M�s) or equivalent
document. If not, the auditor generally should attempt to determine why
they were not identified by the entity as appropriate and report
weaknesses in the reporting process.
Also, the auditor should evaluate whether the aggregate combination of
weaknesses could result in unauthorized access to systems or files
supporting key areas of audit interest. Guidance for evaluating IS
controls and determining the appropriate reporting are discussed
separately for financial audits and attestation engagements and for
performance audits in the following sections.
For example, a series of weaknesses might result in individuals having
the ability to gain unauthorized external access to agency systems,
escalate their privileges to obtain a significant level of access to
critical control points, and consequently achieve access to key areas
of audit interest. The auditor can use simplified network schematics
annotated with weaknesses related to key system components to document
the impact of a series of weaknesses. Such documentation may be
developed as the audit progresses, allowing the auditor to demonstrate
on the system that the weaknesses in fact exist and can be exploited to
achieve the expected result. Also, such documentation can assist in
communicating the related risks to entity management. Figure 3 is an
example of a simplified network schematic annotated with weaknesses
related to key system components.
Figure 3. Example of Network Schematic Describing System Weaknesses:
[See PDF for image]
This figure is an illustration of a network schematic describing system
weaknesses. The following items and information are depicted:
1) Router:
* Access lists not applied;
* Unencrypted management protocols.
2) Firewall;
3) Intrusion detection system:
* Ineffective with encrypted traffic;
* Full data capture not performed;
* Default installation.
4) Server:
* Operating system, database management system, and application servers
unpatched and vulnerable;
* Unnecessary and vulnerable services;
* Weak certificate management;
* Weak session management;
* Clear text passwords;
* Application input not effective.
5) Switch (see number 9);
6) Firewall:
* Excessive rules (in/out);
* unpatched and vulnerable firewall and operating system.
7) Wireless access:
* unencrypted protocols;
* Unauthorized wireless access points;
* Terminates on internal network.
8) Switch (see number 9);
9) Network devices:
* Unpatched and vulnerable services;
* Default Simple Network Management Protocols read/write strings;
* Network not segmented;
* Access lists not applied;
* Unencrypted management protocols.
10) Workstations:
* Operating system unpatched and vulnerable;
* Applications unpatched and vulnerable;
* Unnecessary and vulnerable services;
* Users running as local admin;
* Insecure Active X settings;
* Personal firewalls not used.
11) Servers:
* Operating system and management system unpatched and vulnerable;
* Unnecessary and vulnerable services;
* Poorly configured services;
* Outdated and vulnerable applications;
* Default and easily guessed passwords;
* Excessive directory and file permissions;
* Unencrypted or weak protocols.
Source: GAO.
[End of figure]
Further, the auditor should evaluate the potential impact of any
identified weaknesses on the completeness, accuracy, validity, and
confidentiality of application data relevant to the audit objectives.
(See Chapter 4 for a description of completeness, accuracy, validity,
and confidentiality.)
When IS controls audits are performed as part of a broader financial or
performance audit or attestation engagement, the IS controls specialist
should coordinate with the auditor to determine whether significant
controls are dependent on IT processing. In very rare circumstances,
the auditor may determine that IS controls, in the aggregate, are
ineffective, but that the entity has overall compensating controls not
dependent on IT processing or that other factors mitigate or reduce the
risks arising from IS control weaknesses. For example, manual reviews
of support for all disbursements could mitigate certain IS risks
related to a disbursement system. If compensating controls or other
factors are present, the auditor should document such controls or
factors, test them appropriately to determine whether they effectively
mitigate the identified IS control weaknesses, and draw conclusions
about the nature and extent of the risks that remain after considering
such controls or factors.
As noted earlier in the section entitled �Understand the Overall Audit
Objectives and Related Scope of the Information System Controls Audit,�
if achieving the audit objectives does not require an overall
conclusion on IS controls or only relates to certain components of the
entity or a subset of controls, the auditor�s assessment would not
necessarily identify all significant IS control weaknesses. For
example, a limited review of controls over a type of operating system
may not identify any significant weaknesses, although there may be very
significant weaknesses in other areas that the auditor may not be aware
of because of the limited scope of the audit. Consequently, the auditor
should evaluate the potential limitations of the auditor�s work on the
auditor�s report and the needs and expectations of users. The auditor
may determine that, because the limitations are so significant, the
auditor (1) will communicate the limitations to the audited entity,
those charged with governance, and those requesting the audit and (2)
clearly report such limitations on the conclusions in the audit report.
For example, in reporting on an audit of an operating system, the
auditor may determine that it is appropriate to clearly report that the
scope of the assessment was limited to the operating system and that,
consequently, additional IS control weaknesses may exist that could
impact the effectiveness of IS controls related to the operating system
and to the entity as a whole.
The auditor should express the effect of identified IS control
weaknesses in terms of the audit objectives. The following sections
provide guidelines for assessing IS controls in financial and
performance audits. For financial audits and attestation engagements,
GAGAS states that auditors should report material weaknesses and other
significant deficiencies.
2.3.1 Financial Audits and Attestation Engagements:
The auditor should conclude whether IS control weaknesses, individually
or in the aggregate, constitute a significant deficiency or material
weakness in financial reporting. The auditor should coordinate these
procedures with the overall audit team. For financial audits, GAGAS and
OMB Circular A-123 state that a control deficiency exists when the
design or operation of a control does not allow management or
employees, in the normal course of performing their assigned functions,
to prevent or detect misstatements on a timely basis. A deficiency in
design exists when (a) a control necessary to meet the control
objective is missing or (b) an existing control is not properly
designed so that even if the control operates as designed, the control
objective is not always met. A deficiency in operation exists when a
properly designed control does not operate as designed or when the
person performing the control does not possess the necessary authority
or qualifications to perform the control effectively. In addition, in
financial audits of federal entities, the auditor should evaluate the
effect of IS control weaknesses on FFMIA and FMFIA reporting.
GAGAS uses the following definitions and guidelines for classifying
internal control weaknesses:
A significant deficiency is a deficiency in internal control, or
combination of deficiencies, that adversely affects the entity�s
ability to initiate, authorize, record, process, or report financial
data reliably in accordance with generally accepted accounting
principles such that there is more than a remote likelihood [Footnote
37] that a misstatement of the entity�s financial statements that is
more than inconsequential[Footnote 38] will not be prevented or
detected.
A material weakness is a significant deficiency, or combination of
significant deficiencies, that results in more than a remote likelihood
that a material misstatement of the financial statements will not be
prevented or detected.
OMB Circular A-123 uses the same definition for significant deficiency,
but continues to refer to it as a reportable condition.
In determining whether IS control deficiencies, individually or in the
aggregate, constitute a significant deficiency or material weakness,
the auditor should evaluate several factors, including the following:
* The likelihood that an individual could obtain unauthorized access to
or perform unauthorized or inappropriate activities on key entity
systems or files that could affect information recorded in the
financial statements. This might include (1) the ability to obtain root
access to systems that house key financial systems (including feeder
systems), thereby enabling unauthorized users to read, add, delete, or
modify financial data either directly or through the introduction of
unauthorized software; (2) the ability to directly access and modify
files containing financial information; or (3) the ability to assign
unauthorized application user rights, thereby entering unauthorized
transactions.
* The nature of unauthorized access that could be obtained (e.g.,
limited to system or application programmers or system administrators;
all authorized system users; or anyone through unauthorized external
access through the Internet) or the nature of unauthorized or
inappropriate activity that could be performed.
* The likelihood that financial statement amounts could be materially
affected.
* The likelihood that other controls including business process
application controls would prevent or detect such unauthorized access.
Generally, if the effectiveness of such other controls depends on
computer processed information, it is unlikely that they could
effectively prevent or detect such access, unless the identified IS
control weaknesses could not reasonably result in the ability to
compromise such other controls.
* The risk that management could override controls (such as through
excessive access rights).
Based upon these considerations, the auditor should determine whether
IS control deficiencies, individually or in the aggregate, are a
material weakness or significant deficiency. Also, the auditor should
evaluate whether significant deficiencies, in combination, result in
material weaknesses. If so, the auditor should determine them to be
material weaknesses in drawing conclusions as to the effectiveness of
internal control and reporting findings, as discussed in FAM paragraphs
580.42�.48 and 580.51�.58. If the control deficiencies constitute a
material weakness, the auditor should conclude that internal controls
are not effective.
Financial auditors may take one of two different approaches to
reporting on internal control: (1) express an opinion on internal
control (see FAM paragraphs 580.38-.48) or (2) report weaknesses found,
categorized as material weaknesses or other significant deficiencies,
but do not give an opinion (see FAM paragraphs 580.49-.50). GAO
auditors generally express an opinion on internal control. In either
case, the auditor considers whether internal control is sufficient to
meet the following control objectives insofar as those objectives
pertain to preventing or detecting misstatements, losses, or
noncompliance that would be material in relation to the financial
statements:
* Reliability of financial reporting�transactions are properly
recorded, processed, and summarized to permit the preparation of the
financial statements and supplemental information in accordance with
Generally Accepted Accounting Principles (GAAP), and assets are
safeguarded against loss from unauthorized acquisition, use, or
disposition.
* Compliance with applicable laws and regulations�transactions are
executed in accordance with laws governing the use of budget authority;
other laws and regulations that could have a direct and material effect
on the financial statements or required supplementary information
(RSI); and any other laws, regulations, and governmentwide policies
identified by OMB in its audit guidance.
The auditor may report weaknesses that do not meet the criteria for
significant deficiencies in a letter to management or orally to an
appropriate level of the entity. The auditor may include suggestions
for corrective action for these less significant weaknesses if enough
is understood about their cause. (More detailed information on how and
where to report control weaknesses for financial statement audits is
presented in sections 580.48 through 580.52 of the FAM.)
2.3.2 Performance Audits:
The auditor should draw conclusions on the effectiveness of IS controls
relevant to the audit objectives. Depending on the audit objectives,
the auditor�s report will vary. For example, the auditor�s report may:
* provide an overall conclusion (e.g., the entity�s IS controls are or
are not effective in achieving the IS control objectives relevant to
the audit) and communicate identified weaknesses;
* limit reporting to identified weaknesses without providing an overall
conclusion (e.g., �based on our work, we identified the following IS
control weaknesses�); or;
* if in support of a broader performance audit, report findings in the
context of the audit objectives, such as how they relate to the
assessment of the reliability of computer-processed data.
GAGAS state that auditors should include in their audit reports the
scope of their work on internal control (which includes IS controls)
and any deficiencies in internal control that are significant within
the context of the audit objectives and based upon the audit work
performed. Determining whether and how to communicate to officials of
the audited entity internal control deficiencies that have an
inconsequential effect on the financial statement or subject matter is
a matter of professional judgment. Auditors should document such
communications. The auditor may report such inconsequential weaknesses
orally to officials of the entity or in a separate written
communication.
In determining the significance of the IS control weaknesses, the
auditor should evaluate several factors, including the following:
* The likelihood that an individual could obtain unauthorized access to
or perform unauthorized or inappropriate activities on key entity
systems or files that could affect key areas of audit interest. This
might include (1) the ability to obtain root access to systems that
house key areas of audit interest (including supporting systems),
thereby enabling an intruder to read, add, delete, or modify data
either directly or through the introduction of unauthorized software;
(2) the ability to directly access and modify files related to key
areas of audit interest; or (3) the ability to assign unauthorized
application user rights, thereby enabling an intruder to enter
unauthorized transactions or perform unauthorized activities.
* The nature of unauthorized access that could be obtained (e.g.,
limited to system or application programmers or system administrators;
authorized system users; or anyone through unauthorized external access
through the Internet).
* The likelihood that the achievement of the audit objectives would be
significantly affected.
* The likelihood that other controls including business process
application controls would prevent or detect such unauthorized access.
Generally, if the effectiveness of such other controls depends on
computer processed information, it is unlikely that they could
effectively prevent or detect such access, unless the identified IS
control weaknesses could not reasonably result in the ability to
compromise such other controls.
* The risk that management could override controls (such as through
excessive access rights).
2.3.3 Other Audit Reporting Considerations:
It is important to report IS control weaknesses in terms that are
understandable to individuals who may have limited expertise regarding
information systems issues. In this regard, the auditor generally
should define technical terms and avoid jargon and undefined
abbreviations and acronyms.
Auditors should develop the elements of the findings to the extent
necessary to achieve the audit objectives. The extent to which the
auditor should develop the elements for a finding (criteria, condition,
cause, and effect) depends on the audit objectives. If auditors are
able to sufficiently develop the findings, they should provide
recommendations for corrective action if they are significant within
the context of the audit objectives.
Criteria describe the required or desired state, or what is expected
from the program or operation. Condition is the actual situation. Cause
is the factor or factors responsible for the difference between
condition and criteria. Effect is the impact of the difference between
the condition and the criteria. This information helps senior
management understand the significance of the weakness and develop
appropriate corrective actions. For most types of IS control
weaknesses, this manual includes a discussion of risks and potential
negative effects that can be adapted for audit reports. GAO has issued
numerous reports that can be used as models for reporting computer-
related weaknesses. Current IS reports can be obtained from GAO�s
report database on GAO�s Web site [hyperlink, http://www.gao.gov].
In many cases, auditors will have detailed information on control
weaknesses that is too technical to be meaningful to most senior
managers and other users of the audit report, but may be valuable to
the audit report, but that may be valuable to the entity�s technical
staff in understanding the precise cause of the weaknesses and in
developing corrective actions. The auditors generally should provide
this information to the entity�s technical staff in briefings. The
auditor should provide information to technical staff that is in
substance the same as that reported to senior management.
The auditor should effectively communicate the results of an IS
controls audit to the appropriate persons through appropriate reports.
This serves several purposes, including:
* informing the audited entity and those charged with governance of
control weaknesses; issues of noncompliance with laws, regulations, and
provisions of contracts or grant agreements; and instances of fraud,
illegal acts, or abuse;
* providing the audited entity with recommendations to correct such
control weaknesses;
* providing the financial or performance auditor an understanding of
the information systems control environment and the effects of IT on
the processing of transactions;
* complying with legal reporting requirements; and;
* complying with auditing standards, including generally accepted
government auditing standards.
However, the auditor should avoid the disclosure of sensitive IS data.
An individual could potentially compromise a system from any location
in the world, as long as they have access to a computer and a telephone
line or Internet connection. Technical information discussed in an
audit report could potentially assist individuals by reducing the time
and effort to obtain unauthorized access and compromise a system. Also,
to avoid disclosure of sensitive information, the auditor should
provide draft IS reports to the entity for a sensitivity review. The
auditor should evaluate entity sensitivity concerns and make
appropriate report revisions, considering legal or regulatory
requirements, including the exercise of information classification
authority.
Generally, in the federal environment, either one report with limited
distribution or two reports, one of which has limited distribution, are
issued. Information systems security audit reports may or may not be
put on agency Web sites or released under FOIA, generally depending on
the degree or extensiveness of sensitive data. Even though these
reports may not be posted on agency Web sites, they are still typically
issued to agency management. Also, state laws and regulations may
affect the form of reporting. For further information, see Information
Systems Security Auditing: Legal and Reporting Considerations.
[Footnote 39]
2.3.4 Related Reporting Responsibilities:
In addition to reporting the results of the audit, the auditor may have
other related reporting responsibilities established by law,
regulation, or policy. The auditor should identify any other reporting
requirements and respond appropriately.
In financial audits of federal entities, the auditor should determine
whether the IS control weaknesses, individually or in the aggregate,
constitute a material weakness for FMFIA reporting or a lack of
substantial compliance of the entity�s systems with FFMIA. See FAM
260.53-57 for further information. Also, further information about
reporting IS control weaknesses in relation to a financial audit are
discussed in FAM 580 (Draft Reports).
OMB Circular A-123 provides requirements for complying with FMFIA. The
Circular requires management to assess controls and provide an annual
assurance statement on the overall adequacy and effectiveness of
internal control within the agency. In addition, management is required
to provide a separate assurance statement on the effectiveness of
internal control over financial reporting, which includes safeguarding
of assets and compliance with applicable laws and regulations. Also,
OMB audit guidance requires management to include representations about
internal control in its management representation letter to the
auditor.
FMFIA requires agencies to evaluate and report on the adequacy of the
systems of internal accounting and administrative control. For the
overall assessment of internal control, OMB Circular A-123 defines a
material weakness as a reportable condition which the agency head
determines to be significant enough to report outside of the agency. It
defines a reportable condition as a control deficiency, or combination
of control deficiencies, that in management�s judgment, should be
communicated because they represent significant weaknesses in the
design or operation of internal control that could adversely affect the
organization�s ability to meet its internal control objectives. For the
assessment of internal control over financial reporting, Circular A-123
uses the same definitions for material weakness and significant
deficiency described above for financial audits, except that OMB uses
the term reportable condition rather than the term significant
deficiency. Also, FMFIA and OMB Circular A-123 require management to
report nonconformances with system requirements. The Circular defines
nonconformances as instances in which financial management systems do
not substantially conform to financial systems requirements. Financial
management systems include both financial and financially-related (or
mixed) systems.
The auditor should evaluate the material weaknesses reported under
FMFIA to determine whether they meet the definitions of material
weakness and reportable condition for reporting as part of management�s
assertion about the effectiveness of internal control.
FISMA requires federal agencies to report significant deficiencies in
IS as material weaknesses under FMFIA and, if relating to financial
management systems, as an instance of a lack of substantial compliance
of systems with FFMIA. The term �significant deficiency� used in FISMA
differs from the same term used in GAGAS. OMB defines a FISMA
significant deficiency as �a weakness in an agency�s overall
information systems security program or management control structure,
or within one or more information systems that significantly restricts
the capability of the agency to carry out its mission or compromises
the security of its information, information systems, personnel, or
other resources, operations, or assets. In this context, the risk is
great enough that the agency head and outside agencies must be notified
and immediate or near-immediate corrective action must be taken.� The
following points provide guidance in determining whether there is a
FISMA significant deficiency:
* If IS controls are ineffective with respect to one of the nine
control categories (see table 1), such ineffective control(s) represent
a FISMA significant deficiency.
* If IS controls are ineffective with respect to one or more critical
elements (that is, tasks that are essential for establishing adequate
controls within a given control category; examples are given in
Chapters 3 and 4), such ineffective control(s) represent a FISMA
significant deficiency unless, based upon the facts and circumstances,
other factors sufficiently mitigate the effect of the control
weaknesses.
* If individual weaknesses meet the above definition, such ineffective
control(s) represent FISMA significant deficiencies.
FFMIA requires agencies to implement and maintain financial management
systems that comply substantially with federal financial management
systems requirements, applicable federal accounting standards, and the
U.S. Government Standard General Ledger[Footnote 40] at the transaction
level. FFMIA requires auditors to assess whether an agency�s financial
management systems comply with system requirements. IS control
weaknesses are a major concern for federal agencies and the general
public and are one of the frequently cited reasons for noncompliance
with FFMIA.
2.3.5 Documentation of Reporting Phase:
The auditor should document appropriate IS information developed in the
reporting phase, including:
* The auditor�s conclusion about the effectiveness of IS controls (in
relation to the IS controls audit objectives) in achieving the critical
elements and the relevant control activities and the basis for the
conclusion, including the factors that the auditor considered in making
the determination.
* If part of a broader audit, the impact of any identified IS control
weaknesses on the overall audit objectives.
* Copies of any reports or written communications issued in connection
with the audit, including the draft the agency commented on and entity
management comments related to such reports and communications.
* For financial audits and attestation engagements, the auditor�s
determination of whether identified weaknesses represent material
weaknesses or significant deficiencies, and the basis for the auditor�s
conclusions.
* Other documentation required by the audit organization�s policies and
procedures, including quality assurance processes.
* Results of procedures to detect any fraud significant to the audit
objectives and the impact on the audit.
* Results of audit follow-up procedures to determine whether agency
corrective actions have been implemented, to sufficiently remediate
previously reported IS control weaknesses.
* As appropriate, the auditor�s considerations and determinations
concerning FMFIA, FFMIA, and other reporting responsibilities
2.4 Documentation:
The auditor should adequately document the IS controls audit. GAGAS has
general documentation requirements for financial and performance audits
and attestation engagements. In summary, they are as follows:
Financial Audits - Auditors must prepare audit documentation in
connection with each engagement in sufficient detail to provide a clear
understanding of the work performed (including the nature, timing,
extent, and results of audit procedures performed), the audit evidence
obtained and its source, and the conclusions reached. Auditors should
prepare audit documentation that enables an experienced auditor, having
no previous connection to the audit, to understand a. the nature,
timing, and extent of auditing procedures performed to comply with
GAGAS and other applicable standards and requirements; b. the results
of the audit procedures performed and the audit evidence obtained; c.
the conclusions reached on significant matters; and d. that the
accounting records agree or reconcile with the audited financial
statements or other audited information.
Attestation Engagements - Auditors must prepare attest documentation in
connection with each engagement in sufficient detail to provide a clear
understanding of the work performed (including the nature, timing,
extent, and results of attest procedures performed); the evidence
obtained and its source; and the conclusions reached. Auditors should
prepare attest documentation in sufficient detail to enable an
experienced auditor, having no previous connection to the attestation
engagement, to understand from the documentation the nature, timing,
extent, and results of procedures performed and the evidence obtained
and its source and the conclusions reached, including evidence that
supports the auditors� significant judgments and conclusions. Auditors
should prepare documentation that contains support for findings,
conclusions, and recommendations before they issue their report.
Auditors also should document the following for attestation engagements
performed under GAGAS: a. the objectives, scope, and methodology of the
attestation engagement; b. the work performed to support significant
judgments and conclusions, including descriptions of transactions and
records examined; c. evidence of supervisory review, before the attest
report is issued, of the work performed that supports findings,
conclusions, and recommendations contained in the attest report; and d.
the auditors� consideration that the planned procedures are designed to
achieve objectives of the attestation engagement when (1) evidence
obtained is dependent on computerized information systems, (2) such
evidence is material to the objective of the engagement, and (3) the
auditors are not relying on the effectiveness of internal control over
those computerized systems that produced the evidence. Auditors should
document (1) the rationale for determining the nature, timing, and
extent of planned procedures; (2) the kinds and competence of available
evidence produced outside a computerized information system, or plans
for direct testing of data produced from a computerized information
system; and (3) the effect on the attestation engagement report if
evidence to be gathered does not afford a reasonable basis for
achieving the objectives of the engagement.
Performance Audits � Auditors must prepare audit documentation related
to planning, conducting, and reporting for each audit. Auditors should
prepare audit documentation in sufficient detail to enable an
experienced auditor, having no previous connection to the audit, to
understand from the audit documentation the nature, timing, extent, and
results of audit procedures performed, the audit evidence obtained and
its source and the conclusions reached, including evidence that
supports the auditors� significant judgments and conclusions. Auditors
should prepare audit documentation that contains support for findings,
conclusions, and recommendations before they issue their report.
Auditors should document the following: a. the objectives, scope, and
methodology of the audit; b. the work performed to support significant
judgments and conclusions, including descriptions of transactions and
records examined; and c. evidence of supervisory review, before the
audit report is issued, of the work performed that supports findings,
conclusions, and recommendations contained in the audit report.
In addition to meeting these general requirements, the auditor should
include, in IS controls audit documentation, the specific information
discussed throughout this chapter, and summarized in Appendix XI.
2.5 Other Information System Controls Audit Considerations:
In addition to the above, the auditor should apply the following topics
and techniques to the extent they are relevant to the entity, the audit
objectives, and the audit procedures.
* Additional IS risk factors.
* Automated audit tools.
* Sampling techniques Also, guidance is provided to the auditor in the
evaluation of IS controls associated with service organizations, single
audits, and FISMA independent evaluations. Guidance on each of these
areas is included in Appendix VII, VIII, and IX, respectively.
2.5.1 Additional IS Risk Factors:
As part of the risk assessment, the auditor should also evaluate the
following additional IS risk factors to the extent that they are
relevant to the entity and the audit objectives. The auditor�s risk
assessment also includes other risk factors not listed here (e.g.,
Voice over Internet Protocol � VoIP)
2.5.1.A Defense-In-Depth Strategy:
Defense-in-Depth is a commonly accepted �best practice� for
implementing computer security controls in today�s networked
environments. In some agencies, the auditor may encounter this strategy
as part of the agency�s security management program. Where an effective
Defense-in-Depth strategy has been implemented by the entity, the
auditor�s assessment of IS risk would generally be lower. Conversely,
where this strategy is not used, the auditor�s assessment of IS risk
would generally be higher. The auditor�s IS control testing generally
provides evidence about the effectiveness of a Defense-in-Depth
strategy. See Chapter 3 (AC-1 and CM-5) for additional information on
Defense-in-Depth strategy.
According to the National Security Agency, Defense-in-Depth integrates
people, operations, and technology capabilities to protect information
systems across multiple layers and dimensions. For example, successive
layers of defense will cause an adversary who penetrates or breaks down
one barrier to promptly encounter successive barriers until the attack
ends. The strategy recommends a balance between protection capabilities
and cost, performance, and operational considerations.
The people component of Defense-in-Depth begins with a senior-level
management commitment (normally at the chief information officer level)
that is based on a clear understanding of the perceived threat. This
component must be implemented with effective information security
policies and procedures, assignment of roles and responsibilities,
commitment of resources, training and awareness programs (for both
users and system administrators), and personnel accountability, which
includes the establishment of physical and personnel security measures
to control and monitor access to facilities and critical elements of
the information technology environment.
The operations component focuses on all activities required to sustain
an agency�s security posture on a day-to-day basis. These activities
include:
* maintaining up-to-date system security policies,
* establishing certification and accreditation programs,
* managing information system security (for example, installing patches
and virus updates, maintaining access control lists),
* performing system security assessments (for example, vulnerability
assessments),
* auditing and monitoring system activity and responding to threats,
and;
* implementing recovery and reconstitution procedures in the event of a
security breach.
The technology component includes defense in multiple places and
layered defense mechanisms that provide intrusion prevention,
detection, and response to security incidents. Since attackers may
target multiple points in an information system, an agency needs to
deploy protection mechanisms at multiple locations including the
protection of local and wide area communication networks (for example,
from denial of service attacks), protection for data transmitted over
the networks (for example, use of encryption and traffic flow security
measures), defense of enclave boundaries (for example, deploy firewalls
and intrusion detection systems), and defense of the computing
environment (for example, access control on hosts and servers). Even
the best security products have inherent weaknesses, so it is only a
matter of time before an attacker finds an exploitable vulnerability.
Therefore, it is important to deploy layered defense mechanisms such as
nested firewalls coupled with intrusion detection at outer and inner
network boundaries, between the adversary and the target.
2.5.1.B Web Applications:
Web applications, which use a web browser as part of the application,
present significant additional IS risks because, if not properly
controlled, they can expose the application and the entity�s systems to
unauthorized access. In some instances, the risk related to the
application itself may be low because it is not critical or it does not
contain sensitive information. However, if not properly controlled, it
could be used to obtain unauthorized access to other entity system
resources. Therefore, due to the heightened risk, even if a web
application itself is not part of the scope of the audit, the auditor
should assess the effectiveness of web application security and, as
appropriate, general controls to determine whether the information
system controls over the application could allow unauthorized access
through the application to other system resources.
2.5.1.C ERP Systems:
ERP systems present additional IS risks. While IS control objectives
contained in the FISCAM, if properly achieved, should address such
risks, it is important for the auditor to properly consider how the
control objectives are achieved in ERP systems. This section provides
some considerations in auditing ERP systems. The auditor should
supplement the FISCAM with audit considerations and techniques that are
specific to the particular ERP system(s) being audited. Although ERP
systems share some similar functionality, the way they are implemented
and the audit techniques (e.g., specific system queries, analysis of
superuser capabilities) applied will vary with the particular vendor.
Factors affecting the overall risk related to ERP systems include the
following:
* ERP systems are highly integrated (e.g., common databases, common
security administration) and cover/include/address a broad range of
entity activities, which leads to increased risks related to several
control areas. For example, an ERP application generally includes a
broader cross-section of users in the entity, increasing the need for
access (particularly least privilege) and segregation of duties
controls. Also, because loss of an ERP system/application can have
devastating consequences to an entity, the entity needs effective
controls over (1) system development/configuration management controls
to provide reasonable assurance that the system will operate as
intended, (2) service continuity/contingency planning to recover the
more comprehensive ERP systems, and (3) access and other general
controls to prevent unauthorized access to entity system resources that
could lead to denial of service. Further, general controls over the ERP
system and supporting databases and operating systems are important to
adequately protect access to the underlying data and processing.
* Because ERP systems are on-line-real-time systems, data validation
controls are critical to reasonably assure that only valid data is
processed by the ERP systems. Controls in ERP systems tend to be
preventive rather than detective, as subsequent detection and
correction of errors may be costly or impossible. Also, fewer controls
may be in place as the data is generally entered and validated once.
* The network architectures for ERP systems are typically more
distributed, resulting in increased access controls and other risks
than for more centralized systems.
* Because security administration is generally centralized and powerful
access is provided to system administrators, access controls over
security administration and segregation of duties controls are
important. In addition, ERP systems have powerful default user IDs that
need to be adequately controlled.
* The broader number of users may also lead to an increase in external
access (wireless or other remote access), from both a broader range of
internal users as well as external users (e.g., vendors, customers),
increasing the number of access points to the entity�s systems.
* ERP systems typically have limited, if any, paper audit trails.
Consequently, controls over audit logs and other general controls are
important for the reliability of data in the ERP systems. Also,
auditing access to ERP systems is typically performed online.
* In many instances, interfaces are developed between the ERP system
and legacy applications. As a result, the adequacy of interface
controls and configuration management controls are important to ensure
that data from legacy systems is reliable, valid, complete, and
properly converted from the legacy application into the ERP system.
* ERP systems may have a program change control module that allows for
direct changes to production code. Therefore, controls related to
segregation of development, test and production facilities and
functions may not be present. Consequently, IS risks related to
configuration management and monitoring are increased, and the entity
should secure and monitor such modules.
ERP systems contain certain controls that are not changeable by the
entity. It is important to understand these controls and how they may
help to achieve the IS control objectives.
In addition, due to the increased risks discussed above, there are a
number of other controls that are of increased significance in ERP
systems, including controls relating to:
* user access to sensitive application capabilities (e.g., pages,
screens, transactions, menus, queries), including related segregation
of duties.
* powerful user roles/profiles, including defaults.
* default user IDs and default passwords.
* default system configurations.
* access to critical tables/databases.
* access to log files.
* the effectiveness of the settings of configurable controls.
* sensitive reports/outputs.
2.5.1.D Interface Controls:
Interface controls are particularly important when applications rely on
input from legacy systems. Such legacy systems are sometimes referred
to as feeder systems. In certain instances, such legacy applications
may not have been designed to fully achieve the objectives of the
application they support. Consequently, the auditor evaluates the
adequacy of interface controls and of application controls related to
such legacy applications to provide reasonable assurance that data from
legacy systems is reliable, valid, complete, and properly converted
from the legacy applications into the applications they support. In
addition, the auditor should assess the effectiveness of application
controls over the legacy applications, if the reliability of input is
relevant to the audit objectives.
2.5.1.E Database Management Systems:
Operational characteristics of various system architectures that
include Database Management Systems (DBMS) software introduce several
potential vulnerabilities to the data/application the DBMS directly
supports and the general controls environment, itself. The degree to
which these potential vulnerabilities increase risk is determined by
the characteristics of the networks and host system(s) involved. One
area of risk exists when the DBMS architecture involves multiple
installations of the DBMS, which may be located on more than one host
system. System and/or application architectures that utilize multiple
DBMS installations are commonly used to support functionally or
geographically distributed operations, high performance requirements,
high availability requirements or some combination of these factors.
When multiple DBMSs exist, the mechanisms that allow them to
communicate with each other need to be implemented and controlled to
prevent unintended data and/or system access. Additionally, modern DBMS
software contains powerful capabilities to access the host�s operating
system and other operating systems and other DBMSs across networks. The
ability to use these capabilities needs to be carefully controlled for
each DBMS installation. Finally, some administrator accounts in DBMS
software provide privileged levels of access to the host�s operating
system. So, users with system administration privileges in DBMS
software may also have significant privileges in host operating systems
and those systems and network devices accessible from the DBMS�s host.
2.5.1.F Network-based Access Control Systems:
Implementations of network-based access control systems (such as LDAPs,
including the Microsoft Active Directory�) introduce the potential for
specific vulnerabilities. Network-based access control systems are
typically hosted on one or more server-class systems. The appropriate
configuration of the operating systems and all factors that can effect
the functioning of the operating systems for these hosts needs to be
carefully controlled. A flaw in operating system-level controls on
these hosts potentially jeopardizes the reliability of the control
functions provided by the network-based access control system and/or
the sensitive access control data contained in that system. Network-
based access control systems are designed to support high performance
and simplify network administration and maintenance. To facilitate
these design considerations, the systems provide flexible methods to
connect to and transfer information with other systems. Due to these
characteristics, it is essential that effective controls be in place to
prevent unintended system functions or data access that could
compromise access controls. The nature of networks and application
architectures that employ network-based access control systems involves
a shared or common reliance on them for critical controls. Therefore, a
compromise of a network-based access control system has the potential
of contributing to the compromise of other systems.
2.5.1.G Workstations:
In modern systems best described as networks of networks, the effect of
workstation controls can be much more significant than control over the
functions nominally identified as associated with a specific
workstation. Workstations can become critical components of a network�s
perimeter as a result of the manner in which they are configured in the
network, the types of sessions they can create with other devices, the
access privileges allowed to workstation users, software running on
those workstations, and controls over both inbound and outbound network
traffic to and from the workstation. An understanding of the
configuration of controls on workstations and network-based controls
over workstations in the context of network perimeter controls is
necessary to assess risk for any network.
2.5.2 Automated Audit Tools:
Various automated audit tools can be used to improve the effectiveness
and efficiency of the IS controls audit. Sometimes referred to as
CAATs, or computer-assisted audit techniques, such tools may be used by
the auditor to gather, or assist in gathering, audit evidence. If the
auditor plans to use automated audit tools, the auditor should
understand:
* when they could be used,
* how they can be used, and,
* the associated risks.
In addition, the auditor should be adequately trained in the
use/operation of these tools and in the interpretation of the results.
Because some tools generate a significant volume of information, the
auditor should understand how to analyze such information.
Also, the auditor should obtain reasonable assurance that the tools and
their use/application produce reliable results and present a reasonably
low risk of disrupting the entity�s systems. Organizations should
develop a process to select, evaluate, and revise software security
tools. The following are some typical steps:
* Research available security tools, listing several in each category.
* Discuss with other members of your audit organization which tools
could be most useful in-house and at sites to be audited. Discuss with
other audit organizations as appropriate.
* Determine the degree of platform-specific security software needed.
* Determine a methodology to evaluate and select software.
* Develop a procedure to train personnel in its use.
* Develop a review process to determine whether the software tool has
produced results commensurate with its cost.
There are many different types of automated audit tools:
* Commercial software, such as Microsoft Excel�, etc., may be used by
the auditor for analyzing data imported from client files, writing
audit programs, etc.
* Generalized audit software may be used by the auditor to query and
extract information from the entity�s information system. For example,
data extraction tools and reporting facilities for access control
software can identify users with excess privileges that circumvent
segregation of duties. IDEA is the generalized software package
available to GAO auditors.
* An embedded audit module is a CAAT in which code prepared by the
auditor is embedded in the client�s software to replicate a specific
aspect of a control procedure, or to record details of certain
transactions in a file accessible only to the auditor.
* An integrated test facility is testing software that is integrated
into the client�s software and enables the auditor�s test data to be
integrated and processed with the client�s live input.
* Using an integrated test facility allows the auditor to be satisfied
that test data are processed in the same way that live data are
processed and to verify that the results are correct. Parallel
simulation is a technique in which actual client data are processed by
a copy of the client�s software that is under separate control of the
auditor and has undergone program code analysis to ensure that the
processing is identical to that of the client�s operational software.
* Program code analysis is the analysis of the client�s program code to
ensure that the instructions given to the computer are the same
instructions that the auditor has previously identified when reviewing
the systems documentation.
* A test data CAAT is a technique in which test data prepared by the
auditor are processed on the current production version of the client�s
software, but separately from the client�s normal input data. Using the
current production software provides evidence that the transactions
were processed in the manner expected.
* Specialized audit software is software designed to perform specific
tasks in specific circumstances, such as comparison of source and
object code, the analysis of unexecuted code, and the generation of
test data.
* Other specialized tools can be used to test IS controls. For example:
- Password crackers can identify the use of vendor-default or easily
guessed passwords.
- Network �sniffers� (software that can intercept and log traffic
passing over a network) can identify the transmission of passwords or
sensitive information in clear text.
- Network scanners, along with standard operating system commands, can
help identify an organization�s network security profile and determine
whether dangerous services are active in components.
- Modem locators (�war dialing� software) can help identify unsecured
dial-in modems.
CAATs can also be used in testing the effectiveness of controls, as a
companion to other controls testing. This would typically involve
making a small selection of transactions and walking them through the
system, or developing an integrated test facility and processing test
transactions through the system. The advantage of using CAATs in
controls testing is that it is possible to test every transaction
(either in a master file or transaction file), to determine whether
there were any control failures.
Any analysis performed using CAATS should be adequately documented. In
addition, a technical review should be performed by audit staff
independent of the preparer to determine that the implementation of
CAATS and the analysis of results is complete and accurate and that any
conclusions are supported by the analysis.
2.5.3 Use of Sampling Techniques:
Controls that leave documented evidence of their existence and
application (such as logs) may be tested by inspecting such evidence.
If sufficient evidence cannot be obtained through walkthroughs in
combination with observation, inquiry, and other tests, the auditor
generally should obtain more evidence by using sampling procedures to
select individual items for inspection. The auditor may use
multipurpose testing to use the same sample to test controls,
compliance, and/or substantive results (such as balances in financial
statements). Multipurpose testing is usually more efficient than
separately designed samples. Alternatively, the auditor may design a
sample to test controls alone. In this case, the auditor generally
should use random attribute sampling. FAM section 450 (Sampling Control
Tests) provides additional information on the use of this sampling
technique, including those that can be applied to performance audits.
[End of chapter]
Chapter 3. Evaluating and Testing General Controls:
3.0 Introduction:
General controls are the policies and procedures that apply to all or a
large segment of an agency�s information systems and help ensure their
proper operation. Examples of primary objectives for general controls
are to safeguard data, protect application programs, and ensure
continued computer operations in case of unexpected interruptions.
General controls are applied at the entitywide, system, and business
process application levels. The effectiveness of general controls at
the entitywide and system levels is a significant factor in determining
the effectiveness of business process controls at the application
level. Without effective general controls at the agency and system
levels, business process controls generally can be rendered ineffective
by circumvention or modification. For example, edits [Footnote 41]
designed to preclude users from entering unreasonably large dollar
amounts in a payment processing system can be an effective application
control. However, this control cannot be relied on if the general
controls permit unauthorized program modifications that might allow
some payments to be exempt from the edit. Consequently, the auditor may
decide that it is efficient to evaluate the effectiveness of general
controls separately from and before evaluating business process
controls.
In planning the evaluation of IS controls, the auditor identifies areas
of audit interest and critical control points. In identifying these
areas, the auditor considers business process applications that are
relevant to the audit objectives. Also, the auditor considers the
network components that are most significant to the effectiveness of IS
controls over the areas of audit interest. In planning the evaluation
of general controls, the auditor considers the most effective and
efficient manner to gather evidence to determine the effectiveness of
general controls over these critical control points. For example, if a
business process application for benefit payments is a key area of
audit interest, the auditor�s testing of general controls is designed,
to the extent possible, to focus on those general controls that most
directly affect the application.
The evaluation of general controls includes the following five general
control areas:
* security management, which provides a framework and continuing cycle
of activity for managing risk, developing security policies, assigning
responsibilities, and monitoring the adequacy of the agency�s computer-
related controls;
* access controls, which limit or detect access to computer resources
(data, programs, equipment, and facilities), thereby protecting them
against unauthorized modification, loss, and disclosure;
* configuration management, which prevents unauthorized changes to
information system resources (for example, software programs and
hardware configurations) and provides reasonable assurance that systems
are configured and operating securely and as intended;
* segregation of duties, which includes policies, procedures, and an
organizational structure to manage who can control key aspects of
computer-related operations; and;
* contingency planning, so that when unexpected events occur, critical
operations continue without disruption or are promptly resumed, and
critical and sensitive data are protected.
For each of these five general control areas, this manual identifies
several critical elements that are essential for establishing adequate
controls. For each critical element, the FISCAM provides a description
of risks, control activities, and suggested audit procedures. The
auditor can use this information to evaluate agency practices. For each
critical element, the auditor should make a summary determination as to
the effectiveness of the agency�s related controls at the entitywide,
system, and application levels. If a critical element is not achieved,
the respective control category is not likely to be achieved. The
auditor should use professional judgment in making such determinations.
To evaluate the effectiveness of general controls, the auditor
identifies control techniques implemented by the agency to address each
of the general controls and determine whether these control techniques,
as designed, are sufficient to achieve the control. If sufficient, the
auditor determines whether they are implemented (placed in operation)
and operating effectively. As discussed later in this section, if the
control techniques are not sufficient or are not implemented as
designed, the auditor should determine the effect on IS controls and
the audit objectives.
As discussed in more detail in Chapter 2, general controls are
applicable at the entitywide, system, and application levels, and so
the auditor should consider general controls at each of these levels.
The control techniques and the related audit tests vary according to
the level to which they are being applied. However, in this manual they
are described at a high level in order to be applicable to many
computer environments; they may require some technical expertise about
the subject to be effectively performed at an agency. More detailed
audit steps generally should be developed by the auditor based on the
specific software and control techniques employed by the agency. Table
2 shows the relationship between the general control areas and the
levels.
Table 2. General Control Categories Applicable at Different Levels of
Audit:
General Controls:
Control Categories: Security Management:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Access Controls:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Configuration Management:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Segregation of Duties:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Contingency Planning:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Source: GAO.
[End of table]
The auditor�s evaluation of the effectiveness of IS controls should
include system level controls related to each critical control point.
Assessing the effectiveness of controls over critical control points
should include consideration of all potential ways in which the
critical control point could be accessed. Generally, for each critical
control point, this would include assessing controls related to the
network, operating system, and infrastructure application components.
For example, if a particular router was deemed to be a critical control
point, the auditor would test controls related to the router itself (a
network component), as well as its operating system, and the
infrastructure applications used to manage the router. Access to any of
these could lead to access to the control point.
To facilitate the auditor�s evaluation, tables identifying commonly
used control techniques and related audit procedures are included after
the discussion of each critical element and also in Appendix II.
These tables can be used for both the preliminary evaluation and the
more detailed evaluation and testing of controls. For the preliminary
evaluation, the auditor can use the tables to guide and document
initial inquiries and observations; for the more detailed evaluation
and testing, the auditor can use the suggested procedures in developing
and carrying out a testing plan. Such a plan would include more
extensive inquiries; inspections of facilities, systems, and written
procedures; and tests of key control techniques, which may include
using audit or system software and vulnerability analysis tools. To
help document these evaluations and allow steps to be tailored to
individual audits, electronic versions of the tables are available on
our Web site at [hyperlink, http://www.gao.gov/aac.html].
When evaluating general controls, auditors may want to supplement the
control techniques and audit procedures contained in this document with
other guidance, including:
* National Institute of Standards and Technology (NIST) information
security standards and guidelines;
* international security standards published by the International
Organization for Standardization and the International Electrotechnical
Commission;
* Information Systems Audit and Control Association (ISACA) auditing
standards, guidelines, and procedures; and;
* requirements unique to the environment and agency being audited.
3.1. Security Management (SM):
An entitywide information security management program is the foundation
of a security control structure and a reflection of senior management�s
commitment to addressing security risks. The security management
program should establish a framework and continuous cycle of activity
for assessing risk, developing and implementing effective security
procedures, and monitoring the effectiveness of these procedures.
Overall policies and plans are developed at the entitywide level.
System and application-specific procedures and controls implement the
entitywide policy. Without a well-designed program, security controls
may be inadequate; responsibilities may be unclear, misunderstood, or
improperly implemented; and controls may be inconsistently applied.
Such conditions may lead to insufficient protection of sensitive or
critical resources and disproportionately high expenditures for
controls over low-risk resources. Through FISMA, Congress requires each
federal agency to establish an agencywide information security program
to provide security to the information and information systems that
support the operations and assets of the agency, including those
managed by a contractor or other agency.
Security Program Guidance:
General guidance on planning and managing an agency information
security program is contained in (1) NIST SP 800-12,[Footnote 42] which
provides guidance on security-related management, operational, and
technical controls and (2) our executive guide describing risk
management principles found at leading organizations (discussed in the
next section).[Footnote 43] In response to FISMA, NIST has since
published a series of information security standards and guidelines for
agencies to effectively manage risk to agency operations and agency
assets. Key publications are:
* FIPS Publication 200, Minimum Security Requirements for Federal
Information and Information Systems;
* FIPS Publication 199, Standards for Security Categorization of
Federal Information and Information Systems
* NIST SP 800-53, Recommended Security Controls for Federal Information
Systems.
FIPS Publication 200 provides:
1. a specification for minimum security requirements for federal
information and information systems;
2. a standardized approach to security control selection using the
security categorization standard, FIPS Publication 199; and;
3. links to NIST SP 800-53, containing the security controls needed for
compliance with these minimum security requirements.
In applying the provisions of FIPS 200, agencies first categorize their
systems as required by FIPS 199 (see Table 5), and then typically
select an appropriate set of security controls from NIST SP 800-53 to
satisfy their minimum security requirements. NIST reviews and updates
the controls in NIST SP 800-53 annually to ensure that the controls
represent the current state of practice in safeguards and
countermeasures for information systems.
FIPS 200 and its supporting publication NIST SP 800-53 establish
conditions to enable organizations to be flexible in tailoring their
security control baselines. Agencies, may, for example, apply scoping
guidance taking into consideration the issues related to such things as
the technologies employed by the agency, size and complexity of the
systems, unique circumstances, and risks involved. Agencies may use
compensating controls in lieu of those controls prescribed by NIST SP
800-53. Agencies may also supplement the controls in NIST SP 800-53
with additional controls that may be needed.
In addition, NIST SP 800-100 provides a broad overview of information
security program elements, including capital planning and investment
control, performance measures, and security services, to assist
managers in understanding how to establish and implement an information
security program. This handbook summarizes and augments a number of
existing NIST standards and guidance documents and provides additional
information on related topics.
Other guidance supporting implementation of FIPS 199 and FIPS 200
include:
* NIST SP 800-18, Guide for Developing Security Plans for Federal
Information Systems.
* NIST SP 800-30, Risk Management Guide for Information Technology
Systems ? NIST SP 800-37, Guide for the Security Certification and
Accreditation of Federal Information Systems.
* NIST SP 800-60, Guide for Mapping Types of Information and
Information Systems to Security Categories
These and other publications, directives, and policies that support
compliance with FISMA are available from NIST�s website [hyperlink,
http://csrc.nist.gov].
Security Management Critical Elements:
Assessing an entitywide security management program involves evaluating
the agency�s efforts to perform each of the critical elements shown in
table 3.
Table 3. Critical Elements for Security Management:
Number: SM-1;
Description: Establish a security management program;
Number: SM-2;
Description: Periodically assess and validate risks;
Number: SM-3;
Description: Document security control policies and procedures;
Number: SM-4;
Description: Implement effective security awareness and other security-
related personnel policies;
Number: SM-5;
Description: Monitor the effectiveness of the security program;
Number: SM-6;
Description: Effectively remediate information security weaknesses;
Number: SM-7;
Description: Ensure that activities performed by external third parties
are adequately secure.
Source: GAO.
[End of table]
The following sections discuss each of these critical elements and the
control activities that support their achievement. At the end of each
critical element, a summary table is presented that associates each
activity with techniques that agencies can use to perform the activity,
as well as procedures for auditing the critical elements and control
activities.
Critical Element SM-1: Establish a Security Management Program:
Agencies should have policies, plans, and procedures that clearly
describe the agency�s security management program. FISMA requires
federal agencies to develop, document, and implement an agencywide
information security program to provide security for the information
and information systems that support the operations and assets of the
agency, including those provided or managed by another agency,
contractor, or other source. The security management program should
cover all major systems and facilities and outline the duties of those
who are responsible for overseeing security and those who own, use, or
rely on the agency�s computer resources. As part of this entitywide
program, the entity should have a security management structure in
place at the system and application levels. Thus, in managing a
particular operating system or network device, the agency should have a
clearly assigned structure and responsibilities for the security of the
operating system and device. Similarly, the entity should have a
clearly assigned structure and responsibilities related to particular
business process applications. The security program policies, plans,
and procedures should be kept up-to-date and revised to reflect system
and organizational changes, problems identified during plan
implementation, and security control assessments or audit reports.
SM-1.1. The security management program is adequately documented,
approved, and up-to-date:
The entity�s security management program should be adequately
documented. The nature and extent of the documentation of the program
may vary. For federal entities, at a minimum, the program should
adequately reflect the agency�s consideration of the following eight
elements of an agency wide information security program required by
FISMA.
1. periodic risk assessments;
2. policies and procedures to ensure cost-effective risk reduction and
compliance with applicable standards and guidance and with agency-
determined system configuration requirements;
3. subordinate information security plans for networks, facilities, and
systems;
4. security awareness training for agency employees and contractors;
5. periodic management testing and evaluation that includes testing of
all major systems;
6. a remedial action process to address any deficiencies;
7. security-incident procedures for detecting, reporting, and
responding to incidents; and;
8. continuity of operations plans and procedures for information
systems.
While most of these elements are covered in this section, security
incident procedures are covered in section 3.2 on access controls, and
continuity of operations is covered in section 3.5 on contingency
planning.
The security management program may be documented in the form of a
separate written security management program plan or may consist of
several documents that collectively record the security management
program. The documentation should be supported by subordinate (system
and application level) plans and procedures; related policies should
cover all major systems and facilities and outline the duties of those
responsible for overseeing security (the security management function),
as well as those who own, use, or rely on the agency�s computer
resources. An entitywide plan may describe such things as the overall
security architecture, applicable procedures, and applicable system and
application-level plans. The system-level plans identify the system-
level architecture (for example, network configuration, control points,
etc.), operational policies and procedures, and any business process
(application-level) plans. Similarly, application-level plans should
contain structures, procedures, and controls specific to the
application.
The security management program should be approved by an appropriate
level of management. In some instances, the entity may include the
documentation in a policy document issued by management. In addition,
for federal agencies, FISMA requires that the Director of OMB review
federal agency security management programs at least annually and
approve or disapprove them.
Finally, to be effective, the security program documentation should be
maintained to reflect current conditions. It should be periodically
reviewed and, if appropriate, updated and reissued to reflect changes
in risk due to factors such as changes in entity mission or the types
and configuration of computer resources in use. Revisions to policies
and plans should be reviewed, approved, and communicated to all
employees. Outdated policies and plans not only reflect a lack of
adequate top management concern, but also may be ineffective because
they may not address current risks.
SM-1.2. A security management structure has been established:
Senior management should establish a structure to implement the
security management program throughout the entity. The structure
generally consists of a core of personnel who are designated as
security managers. These personnel play a key role in developing,
communicating, and monitoring compliance with security polices and
reporting on these activities to senior management. The security
management function also serves as a focal point for other personnel
who play a role in evaluating the appropriateness and effectiveness of
computer-related controls on a day-to-day basis. These personnel
include program managers who rely on the agency�s computer systems,
system administrators, and system users.
As an illustration of the different responsibilities of a security
management structure, FISMA establishes responsibilities for certain
agency officials as follows:
* The agency head is responsible for (1) providing risk-based
information security, (2) complying with FISMA requirements and related
NIST standards, (3) ensuring integration of information security
management with agency strategic and operational planning, (4) ensuring
adequacy of trained information security personnel, and (5) ensuring
receipt of annual reporting from the CIO.
* The CIO is to have authority from the agency head to ensure
compliance with FISMA, including responsibility for (1) designating a
senior agency information security official, (2) developing and
maintaining the agency information security program and related
policies and procedures, (3) training and overseeing information
security personnel, and (4) assisting senior agency officials with
their information security responsibilities.
* Senior agency officials are responsible for information security for
operations and assets under their control, including (1) assessing
risk, (2) determining levels of appropriate security, (3) implementing
policies and procedures to cost-effectively reduce risks to an
acceptable level, and (4) periodically testing and evaluating security
controls.
Our survey of leading organizations[Footnote 44] found that a central
management focal point is key to ensuring that the various activities
associated with managing risk are carried out. Such responsibility is
assigned to a central security program office. A central security
program office may be supplemented by individual security program
managers, designated in units within the entity who assist in the
implementation and management of the organization�s security program.
These individual unit security managers should report to or coordinate
with the central security program office.
Responsibilities of the central security program office may include:
* facilitating risk assessments,
* coordinating development and distribution of security policies and
procedures,
* routinely monitoring compliance with these policies,
* promoting security awareness among system users,
* planning and coordinating security-related activities, including
coordination of geographically dispersed security groups,
* ensuring that desktop security plans are integrated with
infrastructure and database security plans,
* providing reports to senior management on policy and control
evaluation results and advice to senior management on security policy
issues, and;
* representing the entity in the security community.
In assessing the effectiveness of the security management structure for
an entitywide, system, or application level, the auditor considers the
security function�s scope of authority, placement, training and
experience, and tools. For example, security management personnel
should:
* have sufficient authority to obtain data needed to monitor compliance
with policies, report results to senior management, and elevate
concerns regarding inappropriate risk management decisions or
practices;
* have sufficient resources to carry out their responsibilities,
including staff and tools (for example, computers, established audit
trails, and specialized security software);
* report to a level of management that maximizes the independence and
objectivity of the security function;
* not be assigned responsibilities that diminish their objectivity and
independence; and;
* have sufficient training and knowledge of control concepts, computer
hardware, software, telecommunications concepts, physical and logical
security, data architecture, database management and data access
methods, pertinent legislation, and administration and organizational
issues.
SM-1.3. Information security responsibilities are clearly assigned:
Security-related responsibilities of offices and individuals throughout
the entity that should be clearly defined include those of (1)
information resource owners and users, (2) information resources
management and data processing personnel, (3) senior management, and
(4) security administrators. Further, responsibilities for individual
employee accountability regarding the use and disclosure of information
resources should be established. Appendix III of OMB Circular A-130
requires that the rules of the system and application �shall clearly
delineate responsibilities and expected behavior of all individuals
with access...and shall be clear about the consequences of behavior not
consistent with the rules.�
Senior management and information resource management have ultimate
responsibility for providing direction and ensuring that information
security responsibilities are clearly assigned and carried out as
intended. Security plans should clearly establish who �owns� the
various computer resources, particularly data files, and what the
responsibilities of ownership are. Ownership of computer resources
should be assigned to persons responsible for their reliability and
integrity. For example, owners of data files and application programs
are generally the managers of the programs supported by these
applications. These managers are primarily responsible for the proper
operation of the program and for accurate reporting of related computer
data. Similarly, owners of computer facilities and equipment are
generally managers who are responsible for the physical protection of
these resources. If a resource has multiple owners, policies should
clearly describe whether and how ownership responsibilities are to be
shared.
Assignment of ownership responsibilities is important because the
managers who own the resources are in the best position to (1)
determine the sensitivity of the resources, (2) analyze the duties and
responsibilities of users, and (3) determine the specific access needs
of these users. Once these factors are determined, the resource owner
can identify persons authorized to access the resource and the extent
of such access. The owners should communicate these authorizations to
the security administrators, who are then responsible for implementing
access controls in accordance with the owners� authorizations. Section
3.2, Access Controls, further discusses access authorization.
If management and ownership responsibilities are not clearly assigned,
access authorizations may be left to personnel who are not in the best
position to determine users� access needs. Such personnel are likely to
authorize overly broad access in an attempt to ensure that all users
can access the resources they need. This defeats the purpose of access
controls and, depending on the sensitivity of the resources involved,
can unnecessarily provide opportunities for fraud, sabotage, and
inappropriate disclosures.
SM-1.4. Subordinate security plans are documented, approved, and kept
up-to-date:
Entities should have written security plans at the system and
application levels that cover networks, facilities, and systems or
groups of systems, as appropriate. The plans and related policies
should cover all major systems and facilities and outline the duties of
those who are responsible for overseeing security and those who own,
use, or rely on the entity�s computer resources. In addition, these
system-level plans should provide an overview of the security
requirements for the system and a description of the security controls
in place or planned for meeting those requirements. These plans should
be kept up-to-date and revised to reflect system and organizational
changes, problems identified during plan implementation, and security
control assessments or audit reports. NIST SP 800-18 requires that all
security plans should be reviewed and updated, if appropriate, at least
annually. Further, NIST SP 800-18 and Appendix III of OMB Circular A-
130 provide specific guidance on what should be included in federal
agency system security plans.
FISMA states that �each agency shall develop, document, and
implement...subordinate plans for providing adequate information
security for networks, facilities, and systems or groups of information
systems, as appropriate.� System-level plans should identify the system-
level architecture (for example, network configuration, control points,
etc.), operational policies and procedures, and any application-level
plans. Application plans should contain similar elements such as
procedures and controls specific to the application.
System security plans should be clearly documented and, according to
Appendix III of OMB Circular A-130, cover each general support system
and each major application. The circular further specifies the topics
to include in the plans. Topic names will differ depending on whether
the plan is for a general support system or a major application, but
the subject matter will be similar. The required topics are shown in
table 4.
Table 4. Security Controls to Include in System Security Plans:
General support system: rules of the system[A];
Major application: application rules[A];
General support system: training;
Major application: specialized training;
General support system: personnel controls;
Major application: personnel security;
General support system: incident-response capability;
Major application: NA;
General support system: continuity of support;
Major application: contingency planning;
General support system: technical security;
Major application: technical controls;
General support system: system interconnection;
Major application: information sharing;
General support system: NA;
Major application: public access controls.
Source: Appendix III of OMB Circular A-130.
[A] These include rules delineating responsibilities and expected
behaviors of staff.
Note: In this manual, access controls are addressed in section 3.2 and
contingency planning in section 3.5.
[End of table]
To help ensure that the system security plan is complete and supported
by the agency as a whole, senior management should obtain agreement
from all affected parties to establish policies for a security program.
Such agreements will also help ensure that policies and procedures for
security developed at lower levels within the agency are consistent
with overall organizational policies and procedures. In accordance with
Appendix III of OMB Circular A-130, final responsibility for
authorization of a system to process information should be granted by a
management official. Generally, the manager whose program operations
and assets are at risk is the most appropriate management official.
However, any disagreements between program managers and security
specialists as to the adequacy of policies and controls should be
resolved by senior management.
Like the overall security policies and plans, the subordinate security
policies and plans should be maintained to reflect current conditions.
As described in SM-1.1, they should be periodically reviewed and
updated to reflect changes in risk and revisions should be reviewed,
approved, and communicated to employees. Outdated policies and plans
may be ineffective because they may not address current risks.
SM-1.5. An inventory of systems is developed, documented, and kept up-
to-date:
To implement an effective security program, entities need to maintain a
complete, accurate, and up-to-date inventory of their systems. Without
one, the entity cannot effectively manage IS controls across the
entity. For example, effective configuration management requires the
entity to know what systems they have and whether the systems are
configured as intended. Furthermore, the inventory is necessary for
effective monitoring, testing, and evaluation of IS controls, and to
support information technology planning, budgeting, acquisition, and
management.
FISMA requires that each agency develop, maintain, and annually update
an inventory of major information systems operated by the agency or
under its control. OMB Circular A-130 defines a major information
system as a system that requires special management attention because
of its importance to an agency mission; its high development,
operating, or maintenance costs; or its significant role in the
administration of agency programs, finances, property, or other
resources. The inventory must include identification of the interfaces
between the agency systems and all other systems or networks, including
interfaces not controlled by the agency. The inventory is needed to
effectively track the agency systems for annual testing and evaluation
and contingency planning.
Control Techniques and Suggested Audit Procedures for Critical Element
SM-1:
Table 5 presents control activities for critical element SM-1,
techniques that entities may use to perform the activity and procedures
for auditing the critical element and control activities.
SM-1 Related NIST SP-800-53 Controls:
See the first control for each family (e.g., AC-1, AT-1):
PL-2 System Security Plan;
PL-3 System Security Plan Update;
PL-6 Security-Related Activity Planning;
SA-2 Allocation of Resources.
Table 5. Control Techniques and Suggested Audit Procedures for Critical
Element SM-1: Establish a security management program:
Control activities:
SM-1.1. The security management program is adequately documented,
approved, and up-to-date;
Control techniques:
SM-1.1.1. An agency/entitywide security management program has been
developed, documented, and implemented that:
* covers all major facilities and operations,
* has been approved by senior management and key affected parties, and,
* covers the key elements of a security management program:
- periodic risk assessments,
- adequate policies and procedures,
- appropriate subordinate information security plans,
- security awareness training,
- management testing and evaluation,
- a remedial action process,
- security-incident procedures, and,
- continuity of operations.
Audit procedures:
Review documentation supporting the agency/entitywide security
management program and discuss with key information security management
and staff. Determine whether the program:
* adequately covers the key elements of a security management program,
* is adequately documented, and,
* is properly approved.
Determine whether all key elements of the program are implemented.
Consider audit evidence obtained during the course of the audit.
Control activities:
SM-1.1. The security management program is adequately documented,
approved, and up-to-date;
Control techniques:
SM-1.1.2. The agency/entitywide security management program is updated
to reflect current conditions.
Audit procedures:
Based on a review of security management program documentation and
interviews with key information security management and staff,
determine whether the entity has adequate policies and procedures to
identify significant changes in its IT environment that would
necessitate an update to the program, and whether the program is
periodically updated to reflect any changes.
Control activities:
SM-1.2. A security management structure has been established.
Control techniques:
SM-1.2.1. Senior management establishes a security management structure
for the entitywide, system, and applications that has adequate
independence, authority, expertise, and resources.
Audit procedures:
Review security policies and plans, the entity�s organization chart,
and budget documentation. Interview security management staff. Evaluate
the security structure: independence, authority, expertise, and
allocation of resources required to adequately protect the information
systems.
Control activities:
SM-1.2. A security management structure has been established.
Control techniques:
SM-1.2.2. An information systems security manager has been appointed at
an agency/entity level and at appropriate subordinate (i.e., system and
application) levels and given appropriate authority.
Audit procedures:
Review security program documentation detailing security
responsibilities and rules of behavior for security officials, resource
owners, and users at the entitywide, system, and application levels.
Control activities:
SM-1.4. Subordinate security plans are documented, approved, and kept
up-to-date.
Control techniques:
SM-1.4.1. System and application security plans have been documented
and implemented that:
* cover all major facilities and operations,
* have been approved by key affected parties,
* cover appropriate topics (for federal agencies, those prescribed by
OMB Circular A-130; see table 4).
Audit procedures:
Review agency/entity policies and procedures for preparing security
plans. Review the system and application security plans encompassing
key areas of audit interest and critical control points. Determine
whether the plans adequately cover appropriate topics (for federal
agencies, those prescribed by OMB Circular A-130) and are properly
approved. When conducting the audit, determine whether the plans have
been implemented and accurately reflect the conditions noted.
Control activities:
SM-1.4. Subordinate security plans are documented, approved, and kept
up-to-date.
Control techniques:
SM-1.4.2. The subordinate security plans are updated on a regular basis
or whenever there are significant changes to the agency/entity
policies, organization, IT systems, facilities, applications,
weaknesses identified, or other conditions that may affect security.
Audit procedures:
Review relevant security plans and any related documentation indicating
whether they have been reviewed and updated and are current.
Control activities:
SM-1.5. An inventory of systems is developed, documented, and kept up-
to-date.
Control techniques:
SM-1.5.1. A complete, accurate, and up-to-date inventory exists for all
major systems that includes the identification of all system interfaces.
Audit procedures:
Obtain the agency�s/entity�s systems inventory. Discuss with
agency/entity management (1) the methodology and criteria for including
or excluding systems from the inventory and (2) procedures and controls
for ensuring the completeness, accuracy, and currency of the inventory.
Determine whether systems tested during the audit are included in the
inventory. Test the inventory for completeness, accuracy, and currency.
The objective of this step in an IS controls audit being performed as
part of a financial audit or data reliability assessment is generally
limited to understanding management�s process and controls for ensuring
the accuracy of the inventory.
Source: GAO.
[End of table]
Critical Element SM-2. Periodically assess and validate risks:
A comprehensive risk assessment should be the starting point for
developing or modifying an entity�s security policies and security
plans. Such assessments are important because they help make certain
that all threats and vulnerabilities are identified and considered,
that the greatest risks are addressed, and that appropriate decisions
are made regarding which risks to accept and which to mitigate through
security controls. Appropriate risk assessment policies and procedures
should be documented and based on the security categorizations.
FISMA, the Paperwork Reduction Act of 1995, and the Clinger-Cohen Act,
explicitly emphasize a risk-based policy for cost-effective security.
In support of and reinforcing this legislation, OMB Circular A-130,
Appendix III, Security of Federal Automated Information Resources,
requires executive agencies within the federal government to plan for
security; ensure that appropriate officials are assigned security
responsibility; review the security controls in their information
systems; and authorize system processing prior to operations and
periodically thereafter.
Risk assessments should consider threats and vulnerabilities at the
entitywide level, system level, and application levels. For example, at
the entitywide level, risk assessments should consider personnel
policies and procedures, training, and security awareness activities.
At the system level, risks related to connectivity issues (for example,
Internet, dial-up, wireless) and access controls (for example, both
logical and physical) need to be assessed. At the application level,
risk assessments need to consider specific business processes and
highly-integrated enterprise resource planning (ERP) applications
(discussed in Chapter 4).
Risk assessments should consider risks to data confidentiality,
integrity, and availability, and the range of risks that an entity�s
systems and data may be subject to, including those posed by authorized
internal and external users, as well as unauthorized outsiders who may
try to break into the systems. For example, risk assessments should
take into account observed trends in the types and frequency of hacker
activity and threats. Such analyses should also draw on reviews of
system and network configurations, as well as observations and testing
of existing security controls.
Our study of security programs at leading organizations found that the
following were key success factors for risk assessments.
* Organizations had a defined process that allowed an entitywide
understanding of what a risk assessment was and avoided individual
units developing independent definitions.
* Organizations required that risk assessments be performed and
designated a central security group to schedule and facilitate them.
* Risk assessments involved a mix of individuals who have knowledge of
business operations and technical aspects of the organization�s systems
and security controls.
* The business managers were required to provide a final sign-off
indicating agreement with risk-reduction decisions and acceptance of
the residual risk.
* Organizations required that final documentation be forwarded to more
senior officials and to internal auditors so that participants could be
held accountable for their decisions.
* Leading organizations did not attempt to precisely quantify risk.
Although they would have liked to place a dollar value on risks and
precisely quantify the costs and benefits of controls, they felt that
spending time on such an exercise was not worth the trouble. They
believed that few reliable data were available on either the actual
frequency of security incidents or on the full costs of controls and of
damage due to a lack of controls.
Risk assessments are more likely to be effective when performed by
personnel with enough independence to be objective and with enough
expertise (training and experience) to be able to adequately identify
and assess technical and security risks.
Risk assessment and risk management are ongoing efforts. Although a
formal, comprehensive risk assessment is performed periodically, such
as part of a system security plan, risk should be considered whenever
there is a change in an entity�s operations or its use of technology or
in outside influences affecting its operations. Changes to systems,
facilities, or other conditions and identified security vulnerabilities
should be analyzed to determine their impact on risk, and the risk
assessment should be performed or revised as necessary. The risk
assessment and validation and related management approvals should be
documented and maintained on file. Such documentation should include
risk assessments, security test and evaluation results, security plans,
and appropriate management approvals. Further, according to NIST SP 800-
37, systems should be certified and accredited before being placed in
operation and when major system changes occur.
The NIST SP 800-30 risk management guide discusses the development of
an effective risk management program and contains both the definitions
and the practical steps necessary for assessing and mitigating risks
within IT systems.
According to this guide, the principal goal of an entity�s risk
management process should be to protect the entity and its ability to
perform its mission, not only its information technology assets.
According to FISMA, federal agencies must periodically assess the risk
and magnitude of the harm that could result from the unauthorized
access, use, disclosure, disruption, modification, or destruction of
information and information systems that support their operations and
assets. Policies and procedures are based on risk, and the rigor of
management testing and evaluation of information security should also
be based on risk. Also, the Federal Managers� Financial Integrity Act
of 1982 requires agencies to conduct risk assessments to identify and
prioritize their vulnerabilities to waste, fraud, and abuse; Appendix
III of OMB Circular A-130 requires that agencies consider risk when
determining the need for and selecting computer-related control
techniques. However, the Circular no longer requires formal periodic
risk analyses that attempt to quantify in dollars an annual loss
exposure resulting from unfavorable events.
Pursuant to FISMA, NIST developed standards for security categorization
of federal information and information systems according to a range of
potential impacts (FIPS Pub 199). Table 6 summarizes these NIST
standards using potential impact definitions for each security
objective (confidentiality, integrity, and availability). Federal
agencies should categorize/classify their non-national security systems
according to these impact levels. The security categories are based on
the potential impact on an agency should certain events occur that
jeopardize the information and information systems needed by the agency
to accomplish its assigned mission, protect its assets, fulfill its
legal responsibilities, maintain its day-to-day functions, and protect
individuals. NIST also issued a guide for mapping types of information
and information systems to security categories (NIST SP 800-60).
Security categories are to be used in conjunction with vulnerability
and threat information in assessing the risk to an agency.
Table 6. NIST Impact Definitions for Security Objectives:
Security objective:
Confidentiality: Preserving authorized restrictions on information
access and disclosure, including means for protecting personal privacy
and proprietary information. {44 U.S.C., Sec 3542};
Potential impact, Low:
The unauthorized disclosure of information could be expected to have a
limited adverse effect on organizational operations, organizational
assets, or individuals.
Potential impact, Moderate:
The unauthorized disclosure of information could be expected to have a
serious adverse effect on organizational operations, organizational
assets, or individuals.
Potential impact, High:
The unauthorized disclosure of information could be expected to have a
severe or catastrophic adverse effect on organizational operations,
organizational assets, or individuals.
Security objective:
Integrity: Guarding against improper information modification or
destruction, and includes ensuring information non-repudiation and
authenticity. {44 U.S.C., Sec 3542}.
Potential impact, Low:
The unauthorized modification or destruction of information could be
expected to have a limited adverse effect on organizational operations,
organizational assets, or individuals.
Potential impact, Moderate:
The unauthorized modification or destruction of information could be
expected to have a serious adverse effect on organizational operations,
organizational assets, or individuals.
Potential impact, High:
The unauthorized modification or destruction of information could be
expected to have a severe or catastrophic adverse effect on
organizational operations, organizational assets, or individuals.
Security objective:
Availability: Ensuring timely and reliable access to and use of
information. {44 U.S.C. 3542}
Potential impact, Low:
The disruption of access to or use of information or an information
system could be expected to have a limited adverse effect on
organizational operations, organizational assets, or individuals.
Potential impact, Moderate:
The disruption of access to or use of information or an information
system could be expected to have a serious adverse effect on
organizational operations, organizational assets, or individuals.
Potential impact, High:
The disruption of access or use of information or an information system
could be expected to have a severe or catastrophic adverse effect on
organizational operations, organizational assets, or individuals.
Source: National Institute of Standards and Technology (NIST), FIPS
Publication 199, page 6.
[End of table]
One area that merits additional emphasis is the appropriate
consideration of risks associated with sensitive privacy information.
In addition to an appropriate consideration of related risk, specific
controls are discussed at SM-5 and AC-4.2.
In addition to FISMA, federal agencies are subject to privacy laws
aimed at preventing the misuse of personally identifiable
information.[Footnote 45] The Privacy Act of 1974 and the privacy
provisions of the E-Government Act of 2002 contain the major
requirements for the protection of personal privacy by federal
agencies. The Privacy Act places limitations on agencies� collection,
disclosure, and use of personal information maintained in systems of
records[Footnote 46] and requires that when agencies establish or make
changes to a system of records; they must notify the public by a
�system-of-records notice.�[Footnote 47] The E-Government Act of 2002
strives to enhance protection for personal information in government
information systems or information collections by requiring that
agencies conduct privacy impact assessments. These privacy impact
assessments include an analysis of how personal information is
collected, stored, shared, and managed in a federal system. According
to OMB guidance, these privacy impact assessments must analyze and
describe how the information will be secured including administrative
and technological controls and should be current.[Footnote 48]
As discussed in NIST SP 800-60[Footnote 49], in establishing
confidentiality impact levels for each information type, responsible
parties must consider the consequences of unauthorized disclosure of
privacy information (with respect to violations of Federal policy
and/or law). The impact of privacy violations will depend in part on
the penalties associated with violation of the relevant statutes and
policies. Further, it says that, in most cases, the impact on
confidentiality for privacy information will be in the moderate range.
SM-2 Related NIST SP-800-53 Controls:
CA-4 Security Certification;
CA-6 Security Accreditation;
RA-2 Security Categorization;
RA-3 Risk Assessment;
RA-4 Risk Assessment Update.
Control Techniques and Suggested Audit Procedures for Critical Element
SM-2:
Table 7 Control Techniques and Suggested Audit Procedures for Critical
Element SM-2: Periodically assess and validate risks:
Control activities:
SM-2.1. Risk assessments and supporting activities are systematically
conducted.
Control techniques:
SM-2.1.1. Appropriate risk assessment policies and procedures are
documented and based on security categorizations.
Audit procedures:
Review risk assessment policies, procedures, and guidance.
Control activities:
SM-2.1. Risk assessments and supporting activities are systematically
conducted.
Control techniques:
SM-2.1.2. Information systems are categorized based on the potential
impact that the loss of confidentiality, integrity, or availability
would have on operations, assets, or individuals.
Audit procedures:
Determine if security risk categorizations are documented and, for
federal entities, if they comply with FISMA, NIST FIPS Pub 199 and SP
800-60.
Control activities:
SM-2.1. Risk assessments and supporting activities are systematically
conducted.
Control techniques:
SM-2.1.3. Risks are reassessed for the entitywide, system, and
application levels on a periodic basis or whenever systems,
applications, facilities, or other conditions change.
Audit procedures:
Obtain the most recent risk assessments encompassing key areas of audit
interest and critical control points. Determine if the risk assessments
are up-to-date, appropriately documented, approved by management, and
supported by sufficient testing. For federal systems, consider
compliance with FISMA, OMB, and NIST requirements/guidance and whether
the technology used is appropriately considered in the risk assessment
and validations. The objective of this step in an IS controls audit
being performed as part of a financial audit or data reliability
assessment is generally limited to understanding management�s risk
assessment process (including related controls), reading the risk
assessments for the key systems relevant to the audit objectives, and
determining whether risks identified by the IS controls audit are
properly considered in the risk assessments.
Control activities:
SM-2.1. Risk assessments and supporting activities are systematically
conducted.
Control techniques:
SM-2.1.4. Risk assessments and validations, and related management
approvals are documented and maintained on file. Such documentation
includes security plans, risk assessments, security test and evaluation
results, and appropriate management approvals.
Audit procedures:
For a selection of risk assessments determine whether required
management approvals are documented and maintained on file.
Control activities:
SM-2.1. Risk assessments and supporting activities are systematically
conducted.
Control techniques:
SM-2.1.5. Changes to systems, facilities, or other conditions and
identified security vulnerabilities are analyzed to determine their
impact on risk and the risk assessment is performed or revised as
necessary based on OMB criteria.
Audit procedures:
Review criteria used for revising risk assessments. For recent changes
that meet the criteria, determine if the risk assessment was redone or
updated.
Control activities:
SM-2.1. Risk assessments and supporting activities are systematically
conducted.
Control techniques:
SM-2.1.6. Federal systems are certified and accredited before being
placed in operation and at least every 3 years, or more frequently if
major system changes occur.
Audit procedures:
For federal systems that are significant to the audit objectives,,
review certification and accreditation documentation and determine
compliance with NIST SP 800-37. The objective of this step in an IS
controls audit being performed as part of a financial audit or data
reliability assessment is generally limited to understanding the
certification and accreditation process (including related controls),
reading the certifications and accreditations for the key systems
relevant to the audit objectives, and determining whether the
certification and accreditation documentation for the systems tested is
consistent with the testing results.
Source: GAO.
[End of table]
Critical Element SM-3. Document security control policies and
procedures:
Security control policies and procedures should be documented and
approved by management. They should also appropriately consider risk,
address general and application controls, and ensure that users can be
held accountable for their actions. Control policies and procedures may
be written to be more general at the entitywide level and more specific
at the systems (for example, specific configurations) and application
levels (for example, user access rules for specific applications). For
example, access control policies may be implemented at the entitywide
level through communication of formal written guidance; at the system
level through system-level security software, firewall rules, and
access control lists; and at the application level through very
specific controls built into the application. Also, a formal sanctions
process should be established for personnel who fail to comply with
established IS control policies and procedures.
According to FISMA, each agency information security program must
include policies and procedures that are based on risk assessments that
cost-effectively reduce information security risks to an acceptable
level, and ensure that information security is addressed throughout the
life cycle of each agency information system. NIST provides guidance
pertaining to computer security policy and procedures, described here.
Security policy is senior management�s directives to create a computer
security program, establish its goals, and assign responsibilities. The
term is also used to refer to the specific security rules for
particular systems. Because policy is written at a broad level,
agencies also develop standards, guidelines, and procedures that offer
users, managers, and others a clear approach to implementing policy and
meeting organizational goals. Standards and guidelines specify
technologies and methodologies to be used to secure systems. Standards,
guidelines, and procedures may be promulgated throughout an entity via
handbooks, regulations, or manuals.
Procedures are detailed steps to be followed to accomplish particular
security-related tasks (for example, preparing new user accounts and
assigning the appropriate privileges). Procedures provide more detail
in how to implement the security policies, standards, and guidelines.
Manuals, regulations, handbooks, or similar documents may mix policy,
guidelines, standards, and procedures, since they are closely linked.
In order for manuals and regulations to serve as important tools, they
should clearly distinguish between policy and its implementation. This
can help in promoting flexibility and cost-effectiveness by offering
alternative approaches to implementing policies.
SM-3 Related NIST SP-800-53 Controls:
See the first control for each family (e.g., AC-1, AT-1).
Control Techniques and Suggested Audit Procedures for Critical Element
SM-3:
Table 8. Control Techniques and Suggested Audit Procedures for Critical
Element SM-3: Document security control policies and procedures:
Control activities:
SM-3.1 Security control policies and procedures are documented,
approved by management and implemented.
Control techniques:
SM-3.1.1. Security control policies and procedures at all levels:
* are documented,
* appropriately consider risk,
* address purpose, scope, roles, responsibilities, and compliance,
* ensure that users can be held accountable for their actions,
* appropriately consider general and application controls,
* are approved by management, and,
* are periodically reviewed and updated.
Audit procedures:
Review security policies and procedures at the entitywide level, system
level and application level. Compare the content of the policies and
procedures to NIST guidance (e.g. SP 800-30, SP 800-37,SP 800-100) and
other applicable criteria (e.g. configuration standards).
Source: GAO.
[End of table]
Critical Element SM-4. Implement effective security awareness and other
security-related personnel policies:
Effective security-related personnel policies are critical to effective
security. Ineffective personnel policies can result in employees or
contractors inadvertently or intentionally compromising security. For
example, security may be compromised due to an inadequate awareness or
understanding, inadequate security training, or inadequate screening of
employees.
An ongoing security awareness program should be implemented that
includes first-time training for all new employees, contractors, and
users; periodic refresher training for all employees, contractors and
users; and distribution of security policies detailing rules and
expected behaviors to all affected personnel. Relevant security
awareness requirements and guidance are contained in FISMA, OMB
Circular A-130, and NIST SP 800-50, Building an Information Technology
Security Awareness and Training Program. In addition, employees with
significant security responsibilities should receive specialized
training, as described in NIST SP 800-16, �Information Technology
Security Training Requirements: A Role- and Performance-Based Model�
(April 1998).
According to FISMA, an agencywide information security program must
include security awareness training for not only agency personnel but
also contractors and other users of information systems that support
the agency�s operations and assets. This training must cover (1)
information security risks associated with users� activities and (2)
users� responsibilities in complying with agency policies and
procedures designed to reduce these risks. FISMA also includes
requirements for training of personnel with significant
responsibilities for information security. Further, OMB requires
personnel to be trained before they are granted access to systems or
applications. The training is to make sure that personnel are aware of
the system or application�s rules, their responsibilities, and their
expected behavior.
Other security-related personnel policies are also relevant to
effective security. Policies related to personnel actions, such as
hiring, termination, and employee expertise, are important
considerations in securing information systems. If personnel policies
are not adequate, an entity runs the risk of (1) hiring unqualified or
untrustworthy individuals; (2) providing terminated employees
opportunities to sabotage or otherwise impair entity operations or
assets; (3) failing to detect continuing unauthorized employee actions;
(4) lowering employee morale, which may in turn diminish employee
compliance with controls; and (5) allowing staff expertise to decline.
As mentioned, FISMA requires agencies to implement agencywide security
programs that include effective policies and procedures to ensure cost-
effective risk reduction and ensure compliance with FISMA and
applicable OMB (e.g., OMB Circular A-130) and NIST (e.g., SP 800-30)
guidance. This guidance specifically addresses security-related
personnel policies and procedures. For example, NIST SP 800-53
addresses personnel security and controls related to personnel
screening, termination and transfer, and third-party security.
SM-4.1 Ensure that resource owners, system administrators, and users
are aware of security policies:
For a security program to be effective, those expected to comply with
it must be aware of it. Typical means for establishing and maintaining
security awareness include:
* informing users of the importance of the information they handle and
the legal and business reasons for maintaining its integrity and
confidentiality;
* distributing documentation describing security policies, procedures,
and users� responsibilities, including their expected behavior;
* requiring users to periodically sign a statement acknowledging their
awareness and acceptance of responsibility for security (including the
consequences of security violations) and their responsibilities for
following all organizational policies (including maintaining
confidentiality of passwords and physical security over their assigned
areas); and;
* requiring comprehensive security orientation, training, and periodic
refresher programs to communicate security guidelines to both new and
existing employees and contractors.
The leading organizations studied considered promoting awareness to be
one of the most important factors in the risk management process.
Awareness was considered to be especially important in reducing the
risks of �social engineering,� where users are talked into revealing
passwords or other sensitive information to potential thieves.
Educating users about such risks makes them think twice before
revealing sensitive data and makes them more likely to notice and
report suspicious activity.
Employee awareness is also critical in combating security threats posed
by spam, spyware, and phishing. Spam (unsolicited commercial e-mail)
consumes significant resources and is used as a delivery mechanism for
other types of cyberattacks; spyware (software that monitors user
activity without user knowledge or consent) can capture and release
sensitive data, make unauthorized changes, and decrease system
performance; and phishing (fraudulent messages to obtain personal or
sensitive data) can lead to identity theft, loss of sensitive
information, and reduced trust and use of electronic government
services. The blending of these threats creates additional risks that
cannot be easily mitigated with currently available tools.
SM-4.2. Hiring, transfer, termination, and performance policies address
security:
The security policies and procedures (including relevant personnel and
human resources policies and procedures) that should generally be in
place include the following:
* Hiring procedures include contacting references, performing
background investigations, and ensuring that periodic investigations
are performed as required by law and implementing regulations,
consistent with the sensitivity of the position, per criteria from the
Office of Personnel Management.
* Individuals are screened before they are authorized to have access to
organizational information and information systems.
* For employees and contractors assigned to work with confidential
information, confidentiality, nondisclosure, or security access
agreements specify precautions required and unauthorized disclosure
acts, contractual rights, and obligations during employment and after
termination.
* Periodic job rotations and vacations are used, if appropriate, and
work is temporarily reassigned during vacations.
* A formal sanctions process enforces (including performance ratings
for individual employees) compliance with security policies and
procedures.
* Compensation and recognition are appropriate to promote high morale.
* Where appropriate, termination and transfer procedures include:
- exit interview procedures;
- return of property, such as keys, identification cards, badges, and
passes;
- notification to security management of terminations, and prompt
termination of access to the agency�s resources and facilities
(including passwords);
- the immediate escorting of terminated employees�especially those who
have access to sensitive resources�out of the agency�s facilities; and;
- identification of the period during which nondisclosure requirements
remain in effect.
SM-4.3. Employees have adequate training and expertise:
Management should ensure that employees�including data owners, system
users, data processing personnel, and security management
personnel�have the expertise to carry out their information security
responsibilities. To accomplish this, a security training program
should be developed that includes:
* job descriptions that include the education, experience, and
expertise required;
* periodically reassessing the adequacy of employees� skills;
* annual training requirements and professional development programs to
help make certain that employees� skills, especially technical skills,
are adequate and current; and;
* monitoring employee training and professional development
accomplishments.
SM-4 Related NIST SP-800-53 Controls:
AT-2 Security Awareness;
AT-3 Security Training;
AT-4 Security Training Records;
PL-4 Rules of Behavior;
PS-1 Personnel Security Policy and Procedures;
PS-2 Position Categorization;
PS-3 Personnel Screening;
PS-4 Personnel Termination;
PS-5 Personnel Transfer;
PS-6 Access Agreements;
PS-7 Third-Party Personnel Security;
PS-8 Personnel Sanctions.
Control Techniques and Suggested Audit Procedures for Critical Element
SM-4:
Table 9. Control Techniques and Suggested Audit Procedures for Critical
Element SM-4: Implement effective security awareness and other security-
related personnel policies:
Control activities:
SM-4.1. Owners, system administrators, and users are aware of security
policies.
Control techniques:
SM-4.1.1. An ongoing security awareness program has been implemented
that includes security briefings and training that is monitored for all
employees with system access and security responsibilities. Coordinate
with the assessment of the training program in SM-4.3.
Audit procedures:
Review documentation supporting or evaluating the awareness program.
Observe a security briefing. Interview data owners, system
administrators, and system users. Determine what training they have
received and if they are aware of their security-related
responsibilities.
Control activities:
SM-4.1. Owners, system administrators, and users are aware of security
policies.
Control techniques:
SM-4.1.2. Security policies are distributed to all affected personnel,
including system and application rules and expected user behaviors.
Audit procedures:
Review memos, electronic mail files, or other policy distribution
mechanisms. Review personnel files to test whether security awareness
statements are current. If appropriate, call selected users, identify
yourself as security or network staff, and attempt to talk them into
revealing their password.
Control activities:
SM-4.2. Hiring, transfer, termination, and performance policies address
security.
Control techniques:
SM-4.2.1. For prospective employees, references are contacted and
background checks performed. Individuals are screened before they are
given authorization to access organizational information and
information systems.
Audit procedures:
Review hiring policies. For a selection of recent hires, inspect
personnel records and determine whether references have been contacted
and background checks have been performed.
Control activities:
SM-4.2. Hiring, transfer, termination, and performance policies address
security.
Control techniques:
SM-4.2.2. Periodic reinvestigations are performed as required by law,
and implementing regulations [at least once every 5 years], consistent
with the sensitivity of the position per criteria from the Office of
Personnel Management (OPM).
Audit procedures:
Review applicable laws, regulations and reinvestigation policies (e.g.
5CFR 731.106(a); OPM/Agency policy, regulations and guidance; FIPS 201
& NIST SP 800-73, 800-76, 800-78; and, any criteria established for the
risk designation of the assigned position.) For a selection of
sensitive positions, inspect personnel records and determine whether
background reinvestigations have been performed as required.
Control activities:
SM-4.2. Hiring, transfer, termination, and performance policies address
security.
Control techniques:
SM-4.2.3. Nondisclosure or security access agreements are required for
employees and contractors assigned to work with confidential
information.
Audit procedures:
Review policies on confidentiality or security agreements. For a
selection of such users, determine whether confidentiality or security
agreements are on file.
Control activities:
SM-4.2. Hiring, transfer, termination, and performance policies address
security.
Control techniques:
SM-4.2.4. When appropriate, regularly scheduled vacations exceeding
several days are required, and the individual�s work is temporarily
reassigned.
Audit procedures:
Review vacation policies. Inspect personnel records to identify
individuals who have not taken vacation or sick leave in the past year.
Determine who performed employee�s work during vacations.
Control activities:
SM-4.2. Hiring, transfer, termination, and performance policies address
security.
Control techniques:
SM-4.2.5. A formal sanctions process is employed for personnel failing
to comply with security policy and procedures.
Audit procedures:
Review the sanctions process. Determine how compliance with security
policies is monitored and how sanctions were administered.
Control activities:
SM-4.2. Hiring, transfer, termination, and performance policies address
security.
Control techniques:
SM-4.2.6. Where appropriate, termination and transfer procedures
include:
* exit interview procedures;
* return of property, keys, identification cards, passes, etc.;
* notification to security management of terminations and prompt
revocation of IDs and passwords;
* immediate escort of terminated employees out of the agency�s
facilities; and;
* identification of the period during which nondisclosure requirements
remain in effect.
Audit procedures:
Review pertinent policies and procedures. For a selection of terminated
or transferred employees, examine documentation showing compliance with
policies. Compare a system-generated list of users to a list of active
employees obtained from personnel to determine whether IDs and
passwords for terminated employees still exist.
Control activities:
SM-4.3. Employees have adequate training and expertise.
Control techniques:
SM-4.3.1. Skill needs are accurately identified and included in job
descriptions, and employees meet these requirements.
Audit procedures:
Review job descriptions for security management personnel and for a
selection of other personnel. For a selection of employees, compare
personnel records on education and experience with job descriptions.
Control activities:
SM-4.3. Employees have adequate training and expertise.
Control techniques:
SM-4.3.2. A security training program has been developed and includes
first-time security awareness training entitywide for all new
employees, contractors, and users before they are authorized to access
the system, and periodic refresher training thereafter; technical
training for personnel with significant system roles and
responsibilities before they are authorized access to the system; and
periodic refresher training thereafter; and documented entitywide
security training records that are monitored for all employees who have
system access and security responsibilities.
Audit procedures:
Review training program documentation. See NIST SP 800-16 and 800-50
for guidance. Coordinate with the assessment of security awareness in
SM-4.1.
Control activities:
SM-4.3. Employees have adequate training and expertise.
Control techniques:
SM-4.3.3. Employee training and professional development are documented
and monitored.
Audit procedures:
Review training records and related documentation showing whether such
records are monitored and whether employees are receiving the
appropriate training.
Source: GAO.
[End of table]
Critical Element SM-5. Monitor the effectiveness of the security
program:
An important element of risk management is ensuring that policies and
controls intended to reduce risk are effective on an ongoing basis.
Effective monitoring involves the entity performing tests of IS
controls to evaluate or determine whether they are appropriately
designed and operating effectively to achieve the entity�s control
objectives. Senior management�s awareness, support, and involvement are
essential in establishing the control environment needed to promote
compliance with the agency�s/entity�s information security program.
However, because security is not an end in itself, senior managers
should balance the emphasis on security with the larger objective of
achieving the agency�s/entity�s mission. To do this effectively, top
management should understand the agency�s/entity�s security risks and
actively support and monitor the effectiveness of its security
policies. If senior management does not monitor the security program,
it is unlikely that others in the organization will be committed to
properly implementing it. Monitoring is one of GAO�s five internal
control standards.[Footnote 50]
Over time, policies and procedures may become inadequate because of
changes in threats, changes in operations or deterioration in the
degree of compliance. Periodic assessments are an important means of
identifying areas of noncompliance, reminding employees of their
responsibilities, and demonstrating management�s commitment to the
security plan. Such assessments can be performed by entity staff or by
external reviewers engaged by management. Independent audits performed
or arranged by GAO and by agency inspectors general, while an important
check on management performance, should not be viewed as substitutes
for management evaluations of the adequacy of the agency�s security
program.
FISMA requires periodic testing and evaluation of the effectiveness of
information security policies, procedures, and practices. First,
agencies must provide management testing of every system every year,
but the level of rigor may vary depending on the risk. However, OMB in
past FISMA reporting guidance (M-03-19) has noted that annual FISMA
testing does not alter OMB�s policy requiring system reauthorization
(certification and accreditation) at least every 3 years or when
significant changes are made.51 Second, FISMA requires annual
independent evaluations of agency information security programs and
practices to determine their effectiveness. These independent
evaluations must test the effectiveness of control techniques for a
representative subset of systems.
As part of its monitoring function, management should have policies and
procedures for periodically assessing the appropriateness of security
policies and the agency�s compliance with them. At a minimum, such
policies and procedures should address the following areas:
* Frequency of periodic testing. The frequency, nature, and extent of
management�s assessment should appropriately consider information
security risks. Consequently, certain higher-risk systems may be tested
more frequently or more extensively than lower-risk systems. FISMA
requires periodic testing to be performed with a frequency depending on
risk, but no less than annually.
* Depth and breadth of testing. The depth and breadth of testing should
be based on a consideration of potential risk and magnitude of harm,
the relative comprehensiveness of prior reviews, the nature and extent
of tests performed as part of periodic risk and vulnerability
assessments, and the adequacy and successful implementation of
remediation plans.
* Common controls. To facilitate efficient periodic testing, entities
should identify common IS controls that can be tested and the results
used for multiple systems.
* Roles and responsibilities of personnel involved in testing.
Personnel assigned to perform and supervise periodic testing should
possess appropriate technical skills and have appropriate
organizational placement to reasonably assure that tests are properly
performed and results properly reported to entity management. In
addition, personnel should not perform tests of controls for which they
are responsible for implementation or operation.
* Documentation. Tests performed and the results and related analysis
of such tests should be documented to the extent necessary to support
effective supervisory review and independent evaluation.
An integrated testing plan or strategy helps to facilitate effective
and efficient periodic testing. Without such an integrated plan or
strategy, the nature and extent of periodic testing may be inadequate
or testing may be inefficient.
Such tests may include tests performed as part of periodic risk and
vulnerability assessments, continuous monitoring through scanning or
agent-based software tools, or specifically designed tests. Management
should periodically perform vulnerability assessments to help ensure
that entity information resources are adequately protected.
Vulnerability assessments involve analyzing a network to identify
potential vulnerabilities that would allow unauthorized access to
network resources, simulating what might be performed by someone trying
to obtain unauthorized access. Vulnerability assessments typically
consider both unauthorized access by outsiders as well as insiders.
Vulnerability assessments typically include the use of various tools
discussed in Table 10 below, such as scanning tools, password crackers,
and war dialing and war driving tools. Also, vulnerability assessments
may include penetration testing. Vulnerability assessments should be
performed in addition to testing individual access controls and other
control categories.
Since the methods used for unauthorized access vary greatly and are
becoming more sophisticated, the vulnerability assessment techniques
defined here are general in nature and should be supplemented with
techniques and tools specific to the specific environment.
The effectiveness of management�s security testing, including
vulnerability assessments, may affect the auditor�s judgements about
audit risk and consequently, the nature, timing, and extent of audit
testing. Factors to consider in assessing the effectiveness of
management�s testing include:
* the nature of management�s testing (the types of testing management
applied, the strength of the evidence obtained, the experience,
capabilities, and objectivity of the persons performing the testing,
and the quality of documentation of testing),
* the timing of management�s testing (the recentness of testing), and,
* extent of management�s testing (the completeness of testing).
The auditor should review management vulnerability assessments and may
independently perform their own vulnerability assessments to determine
whether management vulnerability assessments are effective.
The type of vulnerability assessments that are conducted by the auditor
affect the scope of the evaluation, methodology used, and the level of
assurance achieved. It is important that the methods chosen by the
auditor provide the least amount of disruption to the entity based on a
cost/risk analysis. Auditors may need to conduct these types of audits
without tools,[Footnote 52] because some audited entities will not want
to accept the risk of an auditor running tools in a �live� environment.
There should be an agreement between the auditor and the audited entity
on the type of testing to be conducted (intrusive or nonintrusive).
Section 2.1.9.E �Communication with Entity Management and Those Charged
With Governance� provides further guidance on communicating the nature
and extent of planned testing with the entity.
Due to the highly technical nature of such testing by the auditor, it
should be performed by persons possessing the necessary technical
skills (e.g., an IT specialist). See Appendix V for additional
information on the Knowledge, Skills, and Abilities needed to perform
IS control audits. Also, section 2.5.2 �Automated Audit Tools� provides
further guidance on the auditor�s use of testing tools. Audit testing
is discussed further in connection with AC-.1.1.
There are several different types of security testing. Some testing
techniques are predominantly manual, requiring an individual to
initiate and conduct the test. Other tests are highly automated and
require less human involvement. Testing may also be conducted from
external connections (for example, from the Internet, dial-up,
wireless), from wide area network connections, or from internal
connections. Regardless of the type of testing, staff that set up and
conduct security testing should have significant security and
networking knowledge, including significant expertise in the following
areas: network security, firewalls, intrusion detection systems,
operating systems, programming and networking protocols (such as
Transmission Control Protocol/Internet Protocol (TCP/IP) � which is a
low-level communication protocol that allows computers to send and
receive data).
Table 10 summarizes types of security testing.
Table 10. Types of Security Testing:
Test type: Network scanning;
What it does:
* Enumerates the network structure and determines the set of active
hosts and associated software;
* Identifies unauthorized hosts connected to a network;
* Identifies open ports;
* Identifies unauthorized services.
Test type: General vulnerability scanning;
What it does:
* Enumerates the network structure and determines the set of active
hosts and associated software;
* Identifies a target set of computers to focus vulnerability analysis;
* Identifies potential vulnerabilities on the target set;
* Verifies that software (e.g., operating systems and major
applications) is up-to-date with security patches and software
versions.
Test type: Penetration testing;
What it does:
* Determines how vulnerable an organization�s network is to penetration
and the level of damage that can be incurred;
* Tests IT staff�s response to perceived security incidents and their
knowledge of and implementation of the organization�s security policy
and system�s security requirements;
* Verifies potential impact of multiple security weaknesses.
Test type: Password cracking;
What it does:
* Verifies that the policy is effective in producing passwords that are
more or less difficult to break;
* Verifies that users select passwords that are compliant with the
organization�s security policy.
Test type: Log reviews;
What it does:
* Verifies that the system is operating according to policy.
Test type: Integrity checkers;
What it does:
* Detects unauthorized file modifications.
Test type: Virus detectors;
What it does:
* Detects and deletes viruses before successful installation on the
system.
Test type: War dialing;
What it does:
* Detects unauthorized modems and prevents unauthorized access to a
protected network.
Test type: War driving;
What it does:
* Detects unauthorized wireless access points and prevents unauthorized
access to a protected network.
Test type: Specialty scanning tools;
What it does:
* Detects security risks related to specific IS control areas (e.g.,
weaknesses in web pages, application code, and databases, network
sniffers[Footnote 53]).
Source: Guideline on Network Security Testing (NIST SP 800-42, October
2003).
[End of table]
Often, several of these testing techniques are used together for a more
comprehensive assessment of the overall network security posture. For
example, penetration testing usually includes network scanning and
vulnerability scanning to identify vulnerable hosts and services that
may be targeted for later penetration. Some vulnerability scanners
incorporate password cracking. None of these tests by themselves will
provide a complete picture of the network or its security posture. NIST
SP 800-42 describes these testing types in detail and summarizes the
strengths and weaknesses of each test.
However, since penetration testing requires extensive planning and
experienced staff to conduct, the auditor typically considers several
factors before deciding to perform this testing. For example,
penetration testing may be a desirable testing option when significant
changes have been made to the entity�s network (e.g., upgrades to
server, routers, switches, network software), there are no recent
penetration tests performed, or results of recent penetration testing
identified significant security weaknesses that management represented
were substantially corrected. Conversely, if recent penetration testing
disclosed few security weaknesses and the scope and level of testing is
determined by the auditor to be sufficient, then the use of other types
of testing may be more appropriate.
Other tools that may be used include specialty scanning tools (for
example, application code, Web, database, SNMP[Footnote ]54), host data
extraction tools, packet analyzers or sniffers (for example, ethereal),
and patch assessment tools. Separate patch assessment tools are more
reliable than vulnerability scanners for this purpose. Also, the
auditor is more likely to check for the presence of integrity checkers
and virus detectors than to use them in an audit. After running any
tests, certain procedures should be followed, including documenting the
test results, informing system owners of the results, and ensuring that
vulnerabilities are patched or mitigated.
When implementing system security plans for federal systems, as
required by FISMA and OMB Circular A-130, management should monitor
their implementation and adjust the plans in accordance with changing
risk factors. Management should:
* develop and document appropriate testing policies and procedures (all
levels),
* test and document security controls related to each major system at
least annually (system level),
* ensure that the frequency and scope of testing is commensurate with
risk (all levels), and,
* employ automated mechanisms to verify the correct operation of
security functions when anomalies are discovered (system and
application level).
In addition to the FISMA provisions in the E-Government Act of 2002,
Section 208 requires that agencies conduct privacy impact assessments.
A privacy impact assessment is an analysis of how information is
handled (1) to ensure handling conforms to applicable legal,
regulatory, and policy requirements regarding privacy; (2) to determine
the risks and effects of collecting, maintaining, and disseminating
information in identifiable form in an electronic information system;
and (3) to examine and evaluate protections and alternative processes
for handling information to mitigate potential privacy risks (OMB
Memorandum M-03-22). OMB combined the FISMA and privacy annual
reporting beginning in fiscal year 2005 (OMB Memorandum M-05-15).
Further, OMB has developed performance measures for federal agency
reporting and requires that agencies provide quarterly performance
metric updates. For example, one such measure requests the number of
systems for which security controls have been tested and evaluated in
the past year. Incomplete reporting on OMB�s performance measures will
be noted in OMB�s public report to Congress and will be a consideration
in OMB�s annual approval or disapproval of the agency�s security
program. NIST SP 800-55 provides additional guidance on performance
measures and compliance metrics to monitor the security process and
periodically report on the state of compliance.
In addition, NIST SP 800-100 provides information on how entities can
develop information security metrics that measure the effectiveness of
their security program, and provide data to be analyzed and used by
program managers and system owners to isolate problems, justify
investment requests, and target funds specifically to the areas in need
of improvement. It describes metric types and discusses development and
implementation approaches.
As mentioned, OMB Circular A-130 requires that federal agencies review
and test the security of their general support systems and major
applications at least once every 3 years�sooner if significant
modifications have occurred or where the risk and magnitude of harm are
high. Although not required, it would be appropriate for an agency to
describe its evaluation program, including the expected type of testing
and frequency of evaluations, in its security plan. (Security plans are
discussed in critical element SM-1.)
OMB also requires that a management official authorize in writing the
use of each general support system and major application. NIST SP 800-
37 refers to this authorization as accreditation. OMD Circular A-130
allows self-reviews of controls for general support systems, but
requires an independent review or audit of major applications. The
authorizations or accreditations are to be provided by the program or
functional managers whose missions are supported by the automated
systems; these represent the managers� explicit acceptance of risk
based on the results of any security reviews, including those performed
as part of financial statement audits and during related risk
assessments. Additional guidance on accrediting federal automated
systems can be found in NIST SP 800-37, Guide for the Security
Certification and Accreditation of Federal Information Systems.
In addition, the Federal Managers� Financial Integrity Act of 1982
(FMFIA) and OMB Circular A-123[Footnote 55] require agencies to
annually assess their internal controls, including computer-related
controls, and report any identified material weaknesses to the
President and the Congress. The quality of the FMFIA process is a good
indicator of management�s (1) philosophy and operating style, (2)
methods of assigning authority and responsibility, and (3) control
methods for monitoring and follow-up. Weaknesses identified during
security reviews conducted under OMB Circular A-130 are to be
considered for reporting under FMFIA and OMB Circular A-123,
particularly if the weakness involves no assignment of security
responsibility, an inadequate security plan, or missing management
authorization.
FISMA requires that each agency conduct an annual independent
evaluation to determine the effectiveness of its information security
program and practices. This evaluation must include testing of
information security policies, procedures, and practices of a
representative subset of the agency�s information systems. The head of
each agency must report the evaluation results to OMB, which summarizes
the results in a report to the Congress. GAO must also provide Congress
with its independent assessment of agency information security policies
and practices, including compliance with the annual evaluation and
reporting requirements.
SM-5 Related NIST SP-800-53 Controls:
CA-2 Security Assessments;
CA-7 Continuous Monitoring;
PL-5 Privacy Impact Assessment;
RA-5 Vulnerability Scanning.
Control Techniques and Suggested Audit Procedures for Critical Element
SM-5:
Table 11. Control Techniques and Suggested Audit Procedures for
Critical Element SM-5: Monitor the effectiveness of the security
program:
Control activities:
SM-5.1. The effectiveness of security controls are periodically
assessed.
Control techniques:
SM-5.1.1. Appropriate monitoring and testing policies and procedures
are documented.
Audit procedures:
Review testing policies and procedures. Determine if there is an
overall testing strategy or plan.
Control activities:
SM-5.1. The effectiveness of security controls are periodically
assessed.
Control techniques:
SM-5.1.2. Management routinely conducts vulnerability assessments and
promptly corrects identified control weaknesses.
Audit procedures:
Interview officials who conducted the most recent agency/entity
vulnerability assessment. Review the methodology and tools used, test
plans and results obtained, and corrective action taken. Determine if
testing is performed that complies with OMB and NIST certification and
accreditation and other testing requirements. If appropriate, perform
independent testing with the approval of management. Determine if
identified control weaknesses are promptly corrected.
Control activities:
SM-5.1. The effectiveness of security controls are periodically
assessed.
Control techniques:
SM-5.1.3. Management routinely conducts privacy impact assessments and
promptly corrects identified control weaknesses.
Audit procedures:
Review privacy impact assessments, including the methodology, a sample
of test plan, and related testing results.
Control activities:
SM-5.1. The effectiveness of security controls are periodically
assessed.
Control techniques:
SM-5.1.4. The frequency and scope of security control testing is
commensurate with risk.
Audit procedures:
Determine if control testing is based on risk.
Control activities:
SM-5.1. The effectiveness of security controls are periodically
assessed.
Control techniques:
SM-5.1.5. Performance measures and compliance metrics monitor the
security processes and report on the state of compliance in a timely
manner.
Audit procedures:
Review agency/entity performance measures and compare to OMB�s
performance measures and NIST guidance.
Control activities:
SM-5.1. The effectiveness of security controls are periodically
assessed.
Control techniques:
SM-5.1.6. An annual independent evaluation of the federal agency�s
information security program tests the effectiveness of the security
policies, procedures, and practices.
Audit procedures:
Review the results of these annual evaluations for both FISMA and
privacy reporting and any assessments of their adequacy and
effectiveness.
Control activities:
SM-5.1. The effectiveness of security controls are periodically
assessed.
Control techniques:
SM-5.1.7. Federal agencies report on the results of the annual
independent evaluations to appropriate oversight bodies. Under OMB
guidance, the head of each agency must submit security and privacy
reports to OMB, which consolidates the information for a report to
Congress. The Comptroller General must also periodically evaluate and
report to Congress on the adequacy and effectiveness of agency
information security policies and practices.
Audit procedures:
Evaluate the reporting process and identify any significant
discrepancies between reports at each level and whether the reports
agree with independent audit evaluations. Note that OMB has annual
requirements for FISMA and privacy reporting.
Source: GAO.
[End of table]
Critical Element SM-6. Effectively Remediate Information Security
Weaknesses:
When weaknesses are identified, the related risks should be reassessed,
appropriate corrective or remediation actions taken, and follow-up
monitoring performed to make certain that corrective actions are
effective. Procedures should be established to reasonably assure that
all IS control weaknesses, regardless of how or by whom they are
identified, are included in the entity�s remediation processes. For
each identified IS control weakness, the entity should develop and
implement appropriate action plans and milestones. Action plans and
milestones should be developed based on findings from security control
assessments, security impact analyses, continuous monitoring of
activities, audit reports, and other sources. When considering
appropriate corrective actions to be taken, the entity should, to the
extent possible, consider the potential implications throughout the
entity and design appropriate corrective actions to systemically
address the deficiency. Limiting corrective action only to identified
deficiencies would not necessarily address similar weaknesses in other
systems or applications or result in the most effective and efficient
corrective action.
In addition to developing action plans and modifying written policies
to correct identified problems, entities should test the implementation
of the corrective actions to determine whether they are effective in
addressing the related problems. Management should continue to
periodically review and test such corrective actions to determine if
they remain effective on a continuing basis. This is an important
aspect of managers� risk management responsibilities.
FISMA specifically requires that agencywide information security
programs include a �process for planning, implementing, evaluating, and
documenting remedial action to address any deficiencies in the
information security policies, procedures, and practices of the
agency.� Further, agencies must report on the adequacy and
effectiveness of the information security program and practices in
annual reports to OMB, Congress, and GAO and in annual budget and
management plans and reports. The latter include reporting a FISMA
�significant deficiency� in information security as a material
weakness. Government Performance and Results Act performance plans must
describe time periods and resources needed to effectuate a risk-based
program.
SM-6 Related NIST SP-800-53 Controls:
CA-5 Plan of Action and Milestones.
Control Techniques and Suggested Audit Procedures for Critical Element
SM-6:
Table 12. Control Techniques and Suggested Audit Procedures for
Critical Element SM-6: Effectively remediate information ssecurity
weaknesses:
Control activities:
SM-6.1. Information security weaknesses are effectively remediated.
Control techniques:
SM-6.1.1. Management initiates prompt action to correct deficiencies.
Action plans and milestones are documented.
Audit procedures:
Review recent POA&Ms, FMFIA reports and prior year audit reports and
determine the status of corrective actions. The objective of this
procedure in an IS controls audit being performed as part of a
financial audit or data reliability assessment is generally limited to
understanding management�s POAM process and related controls to ensure
the accuracy of the information in the POA&Ms, determining whether IS
control weaknesses identified by the IS controls audit are included in
the POA&Ms, and, if not, determining the cause.
Control activities:
SM-6.1. Information security weaknesses are effectively remediated.
Control techniques:
SM-6.1.2. Deficiencies are analyzed in relation to the entire
agency/entity, and appropriate corrective actions are applied
entitywide.
Audit procedures:
Evaluate the scope and appropriateness of corrective actions.
Control activities:
SM-6.1. Information security weaknesses are effectively remediated.
Control techniques:
SM-6.1.3. Corrective actions are tested and are monitored after they
have been implemented and monitored on a continuing basis.
Audit procedures:
Determine if implemented corrective actions have been tested and
monitored periodically.
Source: GAO.
[End of table]
Critical Element SM-7. Ensure that activities performed by external
third parties are adequately secure:
Appropriate policies and procedures should be developed, implemented,
and monitored to ensure that the activities performed by external third
parties (for example, service bureaus, contractors, other service
providers such as system development, network management, and security
management) are documented, agreed to, implemented, and monitored for
compliance. These should include provisions for (1) security clearances
(where appropriate and required), (2) background checks, (3) required
expertise, (4) confidentiality/nondisclosure agreements, (5) security
roles and responsibilities, (6) connectivity agreements, (7) individual
accountability (for example, expectations, remedies), (8) audit access
and reporting, (9) termination procedures, and (10) security awareness
training. In addition, checks should be performed to periodically
ensure that the procedures are being correctly applied and consistently
followed, including the security of relevant contractor systems.
Appropriate controls also need to be applied to outsourced software
development.
FISMA information security requirements apply not only to information
systems used or operated by an agency but also to information systems
used or operated by a contractor of an agency or other agency on behalf
of an agency. In addition, the Federal Acquisition Regulation (FAR)
requires that federal agencies prescribe procedures for ensuring that
agency planners on information technology acquisitions comply with the
information technology security requirements of FISMA, OMB�s
implementing policies including Appendix III of OMB Circular A-130, and
guidance and standards from NIST.[Footnote 56] For example, NIST SP 800-
35 Guide to Information Technology Security Services provides guidance
pertaining to the acquisition or outsourcing of dedicated information
system security services such that (1) incident monitoring, analysis,
and response; (2) operation of information system security devices (for
example, firewalls); and (3) key management services are supported by a
risk assessment and approved by the appropriate, designated agency
official. Acquisition or outsourcing of information system services
explicitly addresses government, service provider, and end-user
security roles and responsibilities. Governmental and private entities
face a range of risks from contractors and other users with privileged
access to their systems, applications and data. Contractors that
provide systems and services or other users with privileged access to
agency/entity systems, applications, and data can introduce risks to
their information and systems; for example, contractors often provide
unsupervised remote maintenance and monitoring of agency/entity
systems. Contractor risks to people, processes, and technology are
summarized in table 13.
Table 13. Examples of Agency-Identified Risks to Federal Systems and
Data Resulting from Reliance on Contractors:
Category: People;
Risk description: Unauthorized personnel having physical access to
agency IT resources (including systems, applications, facilities, and
data).
Category: People;
Risk description: Unauthorized personnel having electronic access to
agency IT resources (including systems, applications, and data).
Category: People;
Risk description: Increased use of foreign nationals.
Category: People;
Risk description: Contractor or privileged users of federal data and
systems who may not receive appropriate, periodic background
investigations.
Category: People;
Risk description: Inadequate segregation of duties (for example,
software developer is the same individual who puts the software into
production).
Category: Processes;
Risk description: Failure by contractor or privileged users of federal
data and systems to follow agency IT security requirements.
Category: Processes;
Risk description: Possible disclosure of agency-sensitive information
to unauthorized individuals or entities.
Category: Processes;
Risk description: Lack of effective compliance monitoring of
contractors performing work off-site or privileged users of federal
data and systems.
Category: Processes;
Risk description: Contractor or privileged users of federal data and
systems may have ineffective patch management processes.
Category: Technology;
Risk description: Incorporation of unauthorized features in customized
application software. For example, a third-party software developer has
the potential to incorporate �back doors,� spyware, or malicious code
into customized application software that could expose agency IT
resources to unauthorized loss, damage, modification, or disclosure of
data.
Category: Technology;
Risk description: Encryption technology may not meet federal standards.
Category: Technology;
Risk description: Intentional or unintentional introduction of viruses
and worms.
Source: Improving Oversight of Access to Federal Systems and Data by
Contractors Can Reduce Risk (GAO-05-362, April 2005).
Note: The various risks identified could represent multiple risks
(i.e., risks in one or more of the identified categories of people,
processes, and technology).
[End of table]
In addition to the risks identified in the table, there are specific
risks from contractor software development activities and off-site
operations. These risks include a poor patch management process that
could impact entity operations (for example, entity Web sites), a
hosting infrastructure that may not separate customer and company data,
and inadequate oversight at an off-site facility.
SM-7 Related NIST SP-800-53 Controls:
AC-20 Use of External Information Systems;
MA-4 Remote Maintenance;
PS-7 Third-Party Personnel Security;
SA-9 External Information System Services.
Control Techniques and Suggested Audit Procedures for Critical Element
SM-7:
Table 14. Control Techniques and Suggested Audit Procedures for
Critical Element SM-7: Ensure that activities performed by external
third parties are adequately secure:
Control activities:
SM-7.1. External third party activities are secure, documented, and
monitored.
Control techniques:
SM-7.1. External third party activities are secure, documented, and
monitored. SM-7.1.1. Appropriate policies and procedures concerning
activities of external third parties (for example, service bureaus,
contractors, other service providers such as system development,
network management, security management) are documented, agreed to,
implemented, and monitored for compliance and include provisions for:
* clearances,
* background checks,
* required expertise,
* confidentiality agreements,
* security roles and responsibilities,
* connectivity agreements,
* expectations,
* remedies,
* audit access/audit reporting,
* termination procedures, and,
* security awareness training.
Audit procedures:
Review policies and procedures pertaining to external third parties for
the entitywide, system, and application levels. Identify use of
external third parties and review activities including compliance with
FISMA, and applicable policies and procedures. See NIST SP 800-35 for
guidance on IT security services. Determine how security risks are
assessed and managed for systems operated by a third party. Determine
whether external third party services that relate to the technology are
adequately controlled. Coordinate assessment of security awareness
training with SM-4.
Control activities:
SM-7.1. External third party activities are secure, documented, and
monitored.
Control techniques:
SM-7.1.2. Security requirements are included in the information system
acquisition contracts based on an assessment of risk.
Audit procedures:
Review security provisions of selected contracts and determine that
requirements are implemented. See FAR requirements for acquisition
plans (48 CFR 7.1, 7.103 (u).
Source: GAO.
[End of table]
3.2. Access Controls (AC):
Access controls limit or detect inappropriate access to computer
resources (data, equipment, and facilities), thereby protecting them
from unauthorized modification, loss, and disclosure. Such controls
include both logical and physical controls. Logical access controls
require users[Footnote 57] to authenticate themselves (through the use
of secret passwords or other identifiers) and limit the files and other
resources that authenticated users can access and the actions that they
can execute. Physical access controls involve restricting physical
access to computer resources and protecting them from intentional or
unintentional loss or impairment. Without adequate access controls,
unauthorized individuals, including outside intruders and former
employees, can surreptitiously read and copy sensitive data and make
undetected changes or deletions for malicious purposes or personal
gain. In addition, authorized users can intentionally or
unintentionally read, add, delete, or modify data or execute changes
that are outside their span of authority.
Access control policies and procedures should be formally developed,
documented, disseminated, and periodically updated. Policies should
address purpose, scope, roles, responsibility, and compliance issues;
procedures should facilitate the implementation of the policy and
associated access controls. NIST SP 800-12 provides guidance on
security policies and procedures. It is fundamental that control
techniques for both logical and physical access controls be risk-based.
Access control policies and procedures and risk assessments are covered
in section 3.1 of the manual.
For access controls to be effective, they should be properly
authorized, implemented, and maintained. First, an entity should
analyze the responsibilities of individual computer users to determine
what type of access (for example, read, modify, delete) users need to
fulfill their responsibilities. Then, specific control techniques, such
as specialized access control software, should be implemented to
restrict access to these authorized functions alone. Such software can
be used to limit a user�s activities associated with specific systems
or files and keep records of individual users� actions on the computer.
Finally, access authorizations and related controls should be
monitored, maintained, and adjusted on an ongoing basis to accommodate
new and departing employees and changes in users� responsibilities and
related access needs.
Inadequate access controls diminish the reliability of computerized
data and increase the risk of destruction or inappropriate disclosure
of data. The following examples illustrate the potential consequences
of such vulnerabilities.
* By obtaining direct logical access to data files, an individual could
make unauthorized changes for personal gain or obtain sensitive
information. For example, a person could (1) alter the address of a
payee and thereby direct a disbursement to himself or herself, (2)
alter inventory quantities to conceal a theft of assets, (3) alter
critical data needed to make a strategic policy decision, or (4) obtain
confidential personal, commercial, and governmental information.
* By obtaining logical access to business process applications
[Footnote 58] used to process transactions, an individual could grant
unauthorized access to the application, make unauthorized changes to
these programs, or introduce malicious programs, which, in turn, could
be used to access data files, resulting in situations similar to those
just described, or the processing of unauthorized transactions. For
example, a person could alter a payroll or payables program to
inappropriately generate a check for him/herself.
* By obtaining access to system-level resources, an individual could
circumvent security controls to read, add, delete, or modify critical
or sensitive business information or programs. Further, authorized
users could gain unauthorized privileges to conduct unauthorized
actions or to circumvent edits and other controls built into the
application programs.
* By obtaining physical access to computer facilities and equipment, an
individual could (1) obtain access to terminals or telecommunications
equipment that provide input into the computer, (2) obtain access to
confidential or sensitive information on magnetic or printed media, (3)
substitute unauthorized data or programs, or (4) steal or inflict
malicious damage on computer equipment and software.
The objectives of limiting access are to ensure that:
* outsiders (for example, hackers) cannot gain unauthorized access to
the agency�s systems or data;
* authorized users have only the access needed to perform their duties;
* access to very sensitive resources, such as operating systems and
security software programs, are limited to very few individuals;
* employees/contractors are restricted from performing incompatible
functions or functions beyond their responsibility. (Segregation of
duties is discussed in greater detail in section 3.4.)
If these objectives are met, the risk of inappropriate modification or
disclosure of data can be reduced without interfering with users�
practical needs. However, establishing the appropriate balance between
user needs and security requires a careful analysis of the criticality
and sensitivity of information resources available and the tasks
performed by users. Access controls also apply to alternate work sites
(for example, employee residence or contractor facility).
Implementing adequate access controls involves first determining what
level and type of protection is appropriate for individual resources
based on a risk assessment and on who needs access to these resources.
These tasks should be performed by the resource owners. For example,
program managers should determine how valuable their program data
resources are and what access is appropriate for personnel who must use
an automated system to carry out, assess, and report on program
operations. Similarly, managers in charge of systems development and
modification should determine the sensitivity of hardware and software
resources under their control and the access needs of systems analysts
and programmers, and system administration officials should determine
the access needs of their personnel. Levels of access granted to
information resources should be consistent with FIPS 199 risk levels.
This section defines a set of critical elements that should be
considered when conducting a comprehensive assessment of access
controls. Today�s networks and control environments are highly diverse,
complex, and interconnected. Devices that are interconnected develop
control dependencies (discussed in Chapter 2), directly and indirectly,
on other devices such as routers, firewalls, switches, domain name
servers, Web servers, network management stations, e-mail systems, and
browser software. Audit objectives that are limited to targeted
assessments such as a UNIX or Windows audit may not fully recognize the
control dependencies on these systems.
Unfortunately, there are no simple solutions to controlling logical
access. Each entity decides what combination of technologies to deploy
and to what degree, based on business needs and priorities, risk
management, and other factors. For instance, an entity may decide not
to require users to periodically change passwords for e-mail because
initial entry to the system relies on a two-factor token-based
authentication system. Other entities may rely less on boundary
protection but place more emphasis on audit and monitoring.
Accordingly, the collection of controls used will vary from entity to
entity.
The six critical elements for access controls are described here.
* Boundary Protection. Boundary protection pertains to the protection
of a logical or physical boundary around a set of information resources
and implementing measures to prevent unauthorized information exchange
across the boundary in either direction. Firewall devices represent the
most common boundary protection technology at the network level.
* Identification and authentication. If logical connectivity is
allowed, then the users, processes acting on behalf of users, services,
and specific devices are identified and authenticated by the
information system. For example, users� identities may be authenticated
through something they know (a traditional password), something they
have (such as a smart card), or something about them that identifies
them uniquely (such as a fingerprint).
* Authorization. If authentication is successful, authorization
determines what users can do; i.e., it grants or restricts user,
service, or device access to various network and computer resources
based on the identity of the user, service, or device.
* Sensitive system resources. Controls over sensitive system resources
are designed to ensure the confidentiality, integrity, and availability
of system data such as passwords and keys during transmission and
storage. Technologies used to control sensitive data include
encryption, certificate management, hashing, checksums, and
steganography.[Footnote 59]
* Audit and monitoring. Audit and monitoring control involves the
collection, review, and analysis of auditable events for indications of
inappropriate or unusual activity. These controls should be used to
routinely assess the effectiveness of information security controls,
perform investigations during and after an attack, and recognize an
ongoing attack.
* Physical security. Physical security controls restrict physical
access or harm to computer resources and protect these resources from
intentional or unintentional loss or impairment. Such controls include
guards, gates, and locks, and also environmental controls such as smoke
detectors, fire alarms and extinguishers, and uninterruptible power
supplies.
Although the primary relevance of these concepts is to access controls,
they are also relevant to other areas, such as security management and
configuration management. For example, configuration management
assurance controls help ensure that network devices are configured and
are operating as intended. This would include verifying operational
patch levels, disabling unnecessary and dangerous services, correcting
poorly configured services, and protecting against viruses and worms.
Also, these concepts are relevant to activities such as periodic self-
assessment programs (covered in Section 3.1, Security Management).
Assessing access controls involves evaluating the agency�s success in
performing each of the critical elements listed in Table 15. When
evaluating control techniques and performing audit procedures for
access controls, the auditor considers access to networks, access to
operating systems, and access to infrastructure applications.[Footnote
60]
Table 15. Critical Elements for Access Control:
Number:AC-1.
Description: Adequately protect information system boundaries.
Number:AC-2.
Description: Implement effective identification and authentication
mechanisms.
Number:AC-3.
Description: Implement effective authorization controls.
Number:AC-4.
Description: Adequately protect sensitive system resources.
Number:AC-5.
Description: Implement an effective audit and monitoring capability.
Number:AC-6.
Description: Establish adequate physical security controls.
Source: GAO.
[End of table]
Critical Element AC-1. Adequately protect information system
boundaries:
Boundary protection controls logical connectivity into and out of
networks and controls connectivity to and from network connected
devices. At the entitywide level, access control policy is developed
and promulgated through procedures, manuals, and other guidance. At the
system level, any connections to the Internet, or to other external and
internal networks or information systems, should occur through
controlled interfaces (for example, proxies, gateways, routers and
switches, firewalls, and concentrators). At the host or device level,
logical boundaries can be controlled through inbound and outbound
filtering provided by access control lists and personal firewalls. At
the application level, logical boundaries to business process
applications may be controlled by access control lists in security
software or within the applications.
Implementing multiple layers of security to protect information system
internal and external boundaries provides Defense-in-Depth(described
earlier in Additional IS Risk Factors). According to security experts,
a best practice for protecting systems against cyber attacks is for
entities to build successive layers of defense mechanisms at strategic
points in their information technology infrastructures. By using the
strategy of Defense-in-Depth, entities can reduce the risk of a
successful cyber attack. For example, multiple firewalls could be
deployed to prevent both outsiders and trusted insiders from gaining
unauthorized access to systems: one firewall could be deployed at the
network�s Internet connection to control access to and from the
Internet, while another firewall could be deployed between wide area
networks and local area networks to limit employees� access.
In addition to deploying a series of security technologies at multiple
layers, deploying diverse technologies at different layers also
mitigates the risk of successful cyber attacks. If several different
technologies are deployed between the adversary and the targeted
system, the adversary must overcome the unique obstacle presented by
each of the technologies. For example, firewalls and intrusion
detection technologies can be deployed to defend against attacks from
the Internet, and antivirus software can be used to provide integrity
protection for data transmitted over the network. Thus, Defense-in-
Depth can be effectively implemented through multiple security measures
among hosts, local area networks and wide area networks, and the
Internet.
Defense-in-Depth also entails implementing an appropriate network
configuration, which can, in turn, affect the selection and
implementation of cybersecurity technologies. For example, configuring
the agency�s network to channel Internet access through a limited
number of connections improves security by reducing the number of
points that can be attacked from the Internet. At the same time, the
entity can focus technology solutions and attention on protecting and
monitoring the limited number of connections for unauthorized access
attempts. Figure 4 depicts how applying a layered approach to security
through deploying both similar and diverse cybersecurity technologies
at multiple layers can deflect different types of attacks.
Figure 4. Layered Approach to Network Security:
[See PDF for image]
This figure is an illustration of a layered approach to network
security, as follows:
Internet:
Virus:
through firewall;
through Intrusion detection system;
through Wide area network;
through firewall;
through Local area network;
stopped at PC by Antivirus software.
Remote user:
through firewall;
through Intrusion detection system;
through Wide area network;
through firewall;
through Local area network;
through to PC.
Hacker:
through firewall;
stopped by Intrusion detection system.
Source: GAP analysis and Corel Draw.
Note: Excerpt from GAO, Technologies to Secure Federal Systems, GAO-04-
467 (Washington, D.C.: March 2004). AC-1.1.
[End of table]
Appropriately control connectivity to system resources:
Users obtain access to data files and software programs through one or
more access paths through the networks and computer hardware and
software. Accordingly, to implement an appropriate level of security,
it is important that the entity, to the extent possible, identify,
document, and control all access paths. Further, connectivity between
systems should be approved only when appropriate by entity management.
Consideration should be given to the risk and corresponding safeguards
needed to protect sensitive data. NIST SP 800-47 provides guidance on
interconnecting information systems.
Networks should be appropriately configured to adequately protect
access paths between systems and consider the existing technologies.
For standalone computers, identifying access paths may be relatively
simple. However, in a networked environment, careful analysis is needed
to identify all of the system�s entry points and paths to sensitive
files. Networked systems typically consist of multiple personal
computers that are connected to each other and to larger computers,
such as file servers or mainframe processors. Many allow remote access
(for example, dial-up, wireless, Internet) to the information systems
from virtually any remote location. As a result, the entry points to
the system can be numerous. Also, once the system has been entered, the
programs available may provide multiple paths to various data resources
and sensitive applications. Consequently, it is very important that all
access paths be appropriately controlled and protected based on risk.
It is critical that access paths are identified as part of a risk
analysis and documented in an access path diagram or similar network
schematic. Such a diagram or schematic identifies the users of the
system, the type of device from which they can access the system, the
software used to access the system, the resources they may access, the
system on which these resources reside, and the modes of operation and
telecommunications paths. The goal in identifying access paths is to
assist in identifying the points from which system resources could be
accessed and the data stored�points that, therefore, must be
controlled. Specific attention should be given to �backdoor� methods of
accessing data by operators and programmers. As with other aspects of
risk analysis, the access path diagram should be reviewed and updated
whenever any changes are made to the system or to the nature of the
program and program files maintained by the system.
If entry points and access paths are not identified, they may not be
adequately controlled and may be exploited by unauthorized users to
bypass existing controls to gain access to sensitive data, programs, or
password files. Should this happen, managers will have an incomplete
understanding of the risks associated with their systems and,
therefore, may make erroneous risk management decisions.
Connecting to the Internet presents a multitude of vulnerabilities for
an entity due to the Internet�s potential access to billions of people
worldwide. Some Internet users are motivated to try to penetrate
connected systems and have sophisticated software tools as aids, such
as to repeatedly attempt access using different passwords. A variety of
specialized software and hardware is available to limit access by
outside systems or individuals through telecommunications networks.
Examples of network components that can be used to limit access include
secure gateways (firewalls) that restrict access between networks (an
important tool to help reduce the risk associated with the Internet);
teleprocessing monitors, which are programs incorporated into the
computer�s operating system that can be designed to limit access; and
communications port protection devices, such as a security modem that
requires a password from a dial-in terminal before establishing a
network connection. Also available is the smart card, a device about
the size of a credit card that contains a microprocessor, which can be
used to control remote access to a computer with authenticating
information generated by the microprocessor and communicated to the
computer. Encryption is often used to protect the confidentiality of
remote access sessions and is extremely important to protecting
wireless access to information systems.
Information systems may identify and authenticate specific devices
before establishing a connection. Device authentication typically uses
either shared known information (for example, media access control or
transmission control program/Internet protocol addresses) or an
organizational authentication solution to identify and authenticate
devices on local and wide area networks. Thus, it is important for the
auditor to identify the controls over devices that provide this type of
protection.
Emerging threats from the Internet (for example, spam and spyware)
require new and updated protection mechanisms. The entity should employ
spam and spyware protection mechanisms at critical information system
entry points (for example, firewalls, electronic mail servers, remote
access servers) and at workstations, servers, or mobile computing
devices on the network. Consideration should be given to using spam and
software protection products from multiple vendors (for example, using
one vendor for boundary devices and another vendor for workstations) to
provide additional layers of defense. It is also important to centrally
manage spam and software protection mechanisms and to have the system
automatically update these mechanisms.
Depending on how access control techniques and devices are implemented,
they can be used to:
* verify terminal identifications to restrict access through specific
terminals,
* verify IDs and passwords for access to specific applications,
* control access between telecommunications systems and terminals,
* restrict an application�s use of network facilities,
* automatically disconnect at the end of a session,
* provide network activity logs that can be used to monitor network use
and configuration,
* allow authorized users to shut down network components,
* monitor dial-in access to the system by monitoring the source of
calls or by disconnecting and then dialing back users at preauthorized
phone numbers,
* restrict in-house access to communications software,
* control changes to communications software, and,
* restrict and monitor access to telecommunications hardware or
facilities.
As with other access controls, to be effective, remote access controls
should be properly implemented in accordance with authorizations that
have been granted. In addition, tables or lists used to define security
limitations should be protected from unauthorized modification, and in-
house access to communications security software should likewise be
protected from unauthorized access and modification. Dial-in phone
numbers should not be published, and should be changed periodically.
An understanding of the system and network configurations and the
control techniques that have been implemented is necessary to assess
the risks associated with external access through telecommunications
networks and the effectiveness of related controls. This is likely to
require assistance from an auditor with special expertise in
communications-related controls.
Connectivity should only be approved when appropriate to perform
assigned official duties. Significant threats are posed by portable and
mobile devices and personally owned information systems. Portable and
mobile devices (for example, notebook computers, workstations, personal
digital assistants) should not be allowed access to entity networks
without first complying with security policies and procedures. Security
policies and procedures might include activities such as scanning the
devices for malicious code, updating virus protection software,
scanning for critical software updates and patches, conducting primary
operating system (and possibly other resident software) integrity
checks, and disabling unnecessary hardware (for example, wireless).
Security controls include:
* usage restrictions and implementation guidance,
* authorization by appropriate organizational officials, and,
* documentation and monitoring of device access to entity networks.
The entity should also establish strict terms and conditions for the
use of personally-owned information systems. The terms and conditions
should address, at a minimum: (1) the types of applications that can be
accessed from personally-owned information systems; (2) the maximum
FIPS 199 security category of information that can be processed,
stored, and transmitted; (3) how other users of the personally-owned
information system will be prevented from accessing federal
information; (4) the use of virtual private networking and firewall
technologies; (5) the use of and protection against the vulnerabilities
of wireless technologies; (6) the maintenance of adequate physical
security controls; (7) the use of virus and spyware protection
software; and (8) how often the security capabilities of installed
software are to be updated (for example, operating system and other
software security patches, virus definitions, firewall version updates,
spyware definitions).
AC-1.2. Appropriately control network sessions:
It is desirable that information systems prevent further access to the
system by initiating a session lock that remains in effect until the
user reestablishes access using appropriate identification and
authentication procedures. Users should be able to directly initiate
session-lock mechanisms. The information system may also activate
session-lock mechanisms automatically after a specified period of
inactivity defined by the entity. A session lock is not, however, a
substitute for logging out of the information system. When connectivity
is not continual, network connections should automatically disconnect
at the end of a session. OMB Memorandum M-06-16[Footnote 61] requires
that all federal agencies use a �time-out� function for remote access
and mobile devices requiring user re-authentication after 30 minutes
inactivity.
In addition to technical controls, the initial screen viewed by an
individual accessing an agency�s systems through a telecommunications
network should provide a warning banner to discourage unauthorized
users from attempting access, and make it clear that unauthorized
browsing will not be tolerated. For example, an opening warning screen
should state that the system is for authorized users only and that
activity will be monitored. The information system should also display
the agency�s privacy policy before granting access. Previous logon
notification is another control that can identify unauthorized access.
The information system notifies the user on successful logon, of the
date and time of the last logon, the location of the last logon, and
the number of unsuccessful logon attempts since the last successful
logon.
AC-1 Related NIST SP-800-53 Controls:
AC-4 Information Flow Enforcement;
AC-8 System use Notification;
AC-9 Previous Logon Notification;
AC-11 Session Lock;
AC-12 Session Termination;
AC-17 Remote Access;
AC-18 Wireless Access Restrictions;
AC-19 Access Control for Portable and Mobile Devices;
CA-3 Information System Connections;
SC-7 Boundary Protection;
SC-10 Network Disconnect.
Control Techniques and Suggested Audit Procedures for Critical Element
AC-1:
Table 16. Control Techniques and Suggested Audit Procedures for
Critical Element AC-1: Adequately protect information system
boundaries:
Control activity:
AC-1.1. Appropriately control connectivity to system resources.
Control techniques:
AC-1.1.1. Connectivity, including access paths and control technologies
between systems and to internal system resources, is documented,
approved by appropriate entity management, and consistent with risk.
Audit procedures:
Review access paths in network schematics, interface agreements,
systems documentation, and in consultation with IT management and
security personnel identify control points; determine whether the
access paths and related system documentation is up-to-date, properly
approved by management, and consistent with risk assessments.
Control activity:
AC-1.1. Appropriately control connectivity to system resources.
Control techniques:
AC-1.1.2. Networks are appropriately configured to adequately protect
access paths within and between systems, using appropriate
technological controls (e.g. routers, firewalls, etc.).
Audit procedures:
Interview the network administrator; determine how the flow of
information is controlled and how access paths are protected. Identify
key devices, configuration settings, and how they work together.
Perform security testing by attempting to access and browse computer
resources including critical files, security software, and the
operating system. These tests may be performed as (1) an �outsider�
with no information about the agency�s computer systems, (2) an
�outsider� with prior knowledge about the systems�for example, an ex-
insider, and (3) an �insider� with and without specific information
about the agency�s computer systems and with access to the agency�s
facilities. Note: Due to the highly technical nature of such testing,
it should be performed by persons possessing the necessary technical
skills (e.g., an IT specialist). See Appendix V for additional
information on the Knowledge, Skills, and Abilities needed to perform
IS control audits. When performing insider tests, use an ID with no
special privileges to attempt to gain access to computer resources
beyond those available to the account. Also, try to access the agency�s
computer resources using default/generic IDs with easily guessed
passwords. See NIST SP 800-42 for more details. When performing
outsider tests, test the controls over external access to computer
resources, including networks, dial-up, wireless, local area network,
wide area network, and the Internet. See NIST SP 800-42 for more
details.
Control activity:
AC-1.1. Appropriately control connectivity to system resources.
Control techniques:
AC-1.1.3. The information system identifies and authenticates specific
network devices before establishing a connection. (for example, Media
Access Control (MAC) or TCP/IP addresses).
Audit procedures:
When performing outsider tests, test the controls over external access
to computer resources, including networks, dial-up, wireless, local
area network, wide area network, and the Internet. See NIST SP 800-42
for more details.
Control activity:
AC-1.1. Appropriately control connectivity to system resources.
Control techniques:
AC-1.1.4. Remote dial-up access is appropriately controlled and
protected.
Audit procedures:
Interview network administrator and users; determine how remote dial-up
access is controlled and protected (for example, monitor the source of
calls and dial back mechanism); identify all dial-up lines through
automatic dialer software routines and compare with known dial-up
access; discuss discrepancies with management.
Control activity:
AC-1.1. Appropriately control connectivity to system resources.
Control techniques:
AC-1.1.5. Remote Internet access is appropriately controlled and
protected.
Audit procedures:
Interview network administrator and users; determine how connectivity
is controlled and protected. Determine if federal agency policies,
procedures, and practices comply with NIST SP 800-63 guidance on remote
electronic authentication. Supplement with appropriate assessments in
NIST 800-53A.
Control activity:
AC-1.1. Appropriately control connectivity to system resources.
Control techniques:
AC-1.1.6. Remote wireless access is appropriately controlled and
protected.
Audit procedures:
Interview network administrator and users; determine how connectivity
is controlled and protected. Refer to NIST SP 800-97 Establishing
Wireless Robust Security Networks: A guide to IEEE.802.11i for
additional security assessment guidance. Test and validate entity
controls: (1) use a wireless sniffer to capture data (for example,
service set IDs (SSID), (2) if an SSID is obtained, associate the SSID
to the access point, (3) identify what network resources are available,
(4) determine if a security protocol[Footnote 62] such as wired
equivalent privacy (WEP) is implemented, and (5) if a security protocol
is used, employ a program to test the strength of the encryption
algorithm. Test and validate entity controls to identify rogue wireless
access points. Test for rogue wireless access points.
Control activity:
AC-1.1. Appropriately control connectivity to system resources.
Control techniques:
AC-1.1.7. Connectivity is approved only when appropriate to perform
assigned official duties. This includes portable and mobile devices,
and personally-owned information systems.
Audit procedures:
Interview network administrator and users; review justifications for a
sample of connections. Determine if these systems use appropriate
safeguards such as automatic updates for virus protection and up-to-
date patch protection, etc.
Control activity:
AC-1.2. Appropriately control network sessions.
Control techniques:
AC-1.2.1. The information system prevents further access to the system
by initiating a session lock, after a specified period of inactivity
that remains in effect until the user reestablishes access using
identification and authentication procedures.
Audit procedures:
Observe whether the system automatically initiates a session lock
during a period of inactivity, and how the user can directly initiate a
session lock, and then unlock the session.
Control activity:
AC-1.2. Appropriately control network sessions.
Control techniques:
AC-1.2.2 Where connectivity is not continual, network connection
automatically disconnects at the end of a session.
Audit procedures:
Interview network administrator and users; observe whether the control
is implemented.
Control activity:
AC-1.2. Appropriately control network sessions.
Control techniques:
AC-1.2.3. Appropriate warning banners are displayed before logging onto
a system:
* system use notification (for example, U.S. Government system, consent
to monitoring, penalties for unauthorized use, privacy notices);
* previous logon notification (for example, date and time of last logon
and unsuccessful logons).
Audit procedures:
Interview network administrator and users; observe whether the control
is fully implemented and complies with NIST guidance.
Source: GAO.
[End of table]
Critical Element AC-2. Implement effective identification and
authentication mechanisms:
Users (or processes on behalf of users), and devices should be
appropriately identified and authenticated through the implementation
of adequate logical access controls. User authentication establishes
the validity of a user�s claimed identity, typically during access to a
system or application (for example, login). Users can be authenticated
using mechanisms such as requiring them to provide something they have
(such as a smart card); something they alone know (such as a password
or personal identification number); or something that physically
identifies them uniquely (such as a biometric fingerprint or retina
scan). Logical controls should be designed to restrict legitimate users
to the specific systems, programs, and files that they need, and
prevent others, such as hackers, from entering the system at all.
At the entitywide level, information systems accounts need to be
managed to effectively control user accounts and identify and
authenticate users. Account management includes the identification of
account types (i.e., individual, group, system), establishment of
conditions for group membership, and assignment of associated
authorizations. Resource owners should identify authorized users of the
information system and specify access rights. Access to the information
system should be granted based on a valid need to know that is
determined by assigned official duties and should also consider proper
segregation of duties. The entity should require proper identification
for requests to establish information system accounts and approve all
such requests. The entity should also specifically authorize and
monitor the use of guest/anonymous accounts and remove, disable, or
otherwise secure unnecessary accounts. Finally, the entity should
ensure that account managers are notified when information system users
are terminated or transferred and associated accounts are removed,
disabled, or otherwise secured.
AC-2.1. Users are appropriately identified and authenticated:
Identification and authentication is unique to each user (or processes
acting on behalf of users). Account policies (for example, password
policies, account lock out policies) should be formally established and
enforced based on risk. Passwords, tokens, or other devices are used to
identify and authenticate users. Identification is the process of
distinguishing one user from all others, usually through user IDs.
These are important because they are the means by which specific access
privileges are assigned and recognized by the computer. However, the
confidentiality of user IDs is typically not protected. For this
reason, other means of authenticating users�that is, determining
whether individuals are who they say they are�are typically implemented
(for example, passwords, security tokens, etc.). In addition, the
information system should limit the number of concurrent sessions for
any user.
An entity may allow limited user activity without identification and
authentication for publicly available information systems and Web
sites. However, for actions without identification and authentication,
management should consider the risk and only allow such actions to the
extent necessary to accomplish mission objectives.
The most widely used means of authentication is through the use of
passwords. However, passwords are not conclusive identifiers of
specific individuals since they may be guessed, copied, overheard, or
recorded and played back. Typical controls for protecting the
confidentiality of passwords include the following:
* Individual users are uniquely identified rather than having users
within a group share the same ID or password; generic user IDs and
passwords should not be used.
* Passwords are not the same as user IDs.
* Password selection is controlled by the assigned user and not subject
to disclosure.
* Passwords are changed periodically, about every 30 to 90 days. The
more sensitive the data or the function, the more frequently passwords
should be changed.
* Passwords are not displayed when they are entered.
* Passwords contain alphanumeric and special characters and do not use
names or words that can be easily guessed or identified using a
password-cracking mechanism.
* A minimum character length, at least 8 characters, is set for
passwords so that they cannot be easily guessed.
* Use of old passwords (for example, within six generations) is
prohibited.
* Vendor-supplied passwords such as SYSTEM, DEFAULT, USER, DEMO, and
TEST, are replaced immediately on implementation of a new system.
To help ensure that passwords cannot be guessed, attempts to logon to
the system with invalid passwords should be limited. Typically,
potential users are allowed 3 to 7 attempts to log on. This, in
conjunction with the use of pass phrases or other complex passwords,
reduces the risk that an unauthorized user could gain access to a
system by using a computer to try thousands of words or names until
they found a password that provided access. NIST SP 800-63 provides
guidance on password selection and content.
Another technique for reducing the risk of password disclosure is
encrypting the password file. Encryption may be used to transform
passwords into a form readable only by using the appropriate key, held
only by authorized parties. Access to this file should be restricted to
only a few people; encryption further reduces the risk that passwords
could be accessed and read by unauthorized individuals. Passwords
transmitted on the network may likewise be encrypted to prevent
disclosure. Cryptographic controls and related audit procedures are
covered in section AC-4.3.
In addition to passwords, identification devices such as ID cards,
access cards, tokens, and keys may be used. Factors affecting the
effectiveness of such devices include (1) the frequency that possession
by authorized users is checked and (2) users� understanding that they
should not allow others to use their identification devices and should
report the loss of such devices immediately. Procedures should also be
implemented to handle lost or compromised passwords, access cards, or
tokens. OMB Memorandum M-06-16 requires that federal agencies allow
remote access to personally identifiable information and other
sensitive information only with two-factor authentication where one of
the factors is provided by a device separate from the computer gaining
access. Also see AC-4.2.
A less common means of authentication is based on biometrics, an
automated method of verifying or recognizing the identity of a person
based on physiological or behavioral characteristics. Biometrics
devices include fingerprints, retina patterns, hand geometry, speech
patterns, and keystroke dynamics. Tests of biometric techniques include
reviewing the devices, observing the operations, and taking whatever
other steps may be necessary to evaluate their effectiveness, including
obtaining the assistance of a specialist.
To further increase security, identification and authentication may be
accomplished using any combination of multiple mechanisms such as a
token ID in conjunction with a number, or a biometric reader in
conjunction with a password (also known as multifactor identification).
Management should implement effective procedures to determine
compliance with authentication policies. Whatever technique is used,
the implementation cost versus the risk and potential loss to the
agency�s operations from a breach in security should be taken into
consideration.
Electronic signatures such as digital signatures and public key
infrastructure (PKI) are used to identify the sender of information and
ensure the integrity of critical information received from the sender.
Several technologies such as personal identification numbers, smart
cards, biometrics, or digital signatures (an encrypted set of bits that
identify the user) can be used to create electronic signatures. The
most common electronic signature in use today is the digital signature,
which is unique to each individual and to each message. Digital
signatures are used in conjunction with certificate authorities and
other PKI encryption hardware, software, policies, and people to verify
that the individuals on each end of a communication are who they claim
to be and to authenticate that nothing in the message has been changed.
A digital certificate or shared secret may also be used to authenticate
the identity of a device or devices involved in system communications,
as opposed to the users.
In addition, appropriate session-level identification and
authentication controls should be implemented, such as those related to
name/address resolution service and the authenticity of communication
sessions.
AC-2 Related NIST SP-800-53 Controls:
AC-7 Unsuccessful Login Attempts;
AC-10 Concurrent Session Control;
AC-14 Permitted Actions Without Identification or Authentication;
AU-10 Non-Repudiation;
IA-2 User Identification and Authentication;
IA-3 Device Identification and Authentication;
IA-4 Identifier Management;
IA-5 Authenticator Management;
IA-6 Authenticator Feedback;
SC-17 Public Key Infrastructure Certificates;
SC-20 Secure Name/Address Resolution Service (Authoritative Source);
SC-21 Secure Name/Address Resolution Service (Recursive or Caching
Resolver);
SC-22 Architecture and Provisioning for Names/Address Resolution
Service;
SC-23 Session Authenticity.
Control Techniques and Suggested Audit Procedures for Critical Element
AC-2:
Table 17. Control Techniques and Suggested Audit Procedures for
Critical Element AC-2: Implement effective identification and
authentication mechanisms:
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.1. Identification and authentication is unique to each user (or
processes acting on behalf of users), except in specially approved
instances (for example, public Web sites or other publicly available
information systems).
Audit procedures:
Review pertinent policies and procedures and NIST guidance pertaining
to the authentication of user identities; interview users; review
security software authentication parameters.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.2. Account policies (including authentication policies and
lockout policies) are appropriate given the risk, and enforced.
Audit procedures:
Review account policies and determine if they are based on risk and
seem reasonable, based on interviews with system administrator and
users. Determine how they are enforced, and test selected policies.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.3. Effective procedures are implemented to determine compliance
with authentication policies.
Audit procedures:
Review adequacy of procedures for monitoring compliance with
authentication policies; selectively test compliance with key policies.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.4. Selection of authentication methods (for example, passwords,
tokens, biometrics, key cards, PKI certificates, or a combination
therein) are appropriate, based on risk.
Audit procedures:
Determine whether authentication methods used are appropriate, based on
risk.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.5. Authenticators are unique for specific individuals, not
groups;
* are adequately controlled by the assigned user and not subject to
disclosure; and;
* cannot be easily guessed or duplicated.
Additional considerations for passwords are described below.
Audit procedures:
Review pertinent entity policies and procedures; assess procedures for
generating and communicating authenticators to users; interview users;
review related security software parameters. Observe users using
authenticators; attempt to logon without a valid authenticator. Assess
compliance with NIST guidance on authenticator selection, content, and
usage.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.6. Password-based authenticators:
* are not displayed when entered;
* are changed periodically (e.g., every 30 to 90 days);
* contain alphanumeric and special characters;
* are sufficiently long (e.g., at least 8 characters in length);
* have an appropriate minimum life (automatically expire);
* are prohibited from reuse for a specified period of time (e.g., at
least 6 generations); and;
* are not the same as the user ID.
Audit procedures:
Review pertinent entity policies and procedures; assess procedures for
generating and communicating passwords to users; interview users;
review security software password parameters. Observe users keying in
passwords; attempt to logon without a valid password; make repeated
attempts to guess passwords. Assess entity compliance with NIST SP 800-
63, which provides guidance on password selection and content.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.7. Attempts to log on with invalid passwords are limited (e.g.,
3�7 attempts).
Audit procedures:
Examine security parameters for failed log-on attempts; review security
logs to determine whether attempts to gain access are logged and
reviewed by entity security personnel; if appropriate, repeatedly
attempt to logon using invalid passwords.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.8. Use of easily guessed passwords (such as names or words) are
prohibited.
Audit procedures:
Review a system-generated list of current passwords; search password
file using audit software to identify use of easily guessed passwords.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.9. Generic user IDs and passwords are not used.
Audit procedures:
Interview users and security managers; review a list of IDs and
passwords to identify generic IDs and passwords in use.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.10. Vendor-supplied default passwords are replaced during
installation.
Audit procedures:
Attempt to log on using common vendor-supplied passwords; search
password file using audit software.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.11. Passwords embedded in programs are prohibited. (Note: An
embedded password is a password that is included into the source code
of an application or utility. Applications often need to communication
with other applications and systems and this requires an
�authentication� process which is sometimes accomplished through the
use of embedded passwords).
Audit procedures:
Determine if passwords are embedded in programs and if this practice is
explicitly prohibited.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.12. Use of and access to authenticators is controlled (e.g.,
their use is not shared with other users).
Audit procedures:
Interview users. To evaluate biometrics or other technically
sophisticated authentication techniques, the auditor may need to obtain
the assistance of a specialist.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.13. Effective procedures are implemented to handle lost,
compromised, or damaged authenticators (e.g., tokens, PKI certificates,
biometrics, passwords, and key cards).
Audit procedures:
Identify procedures for handling lost or compromised authenticators;
interview users and selectively test compliance with procedures.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.14. Concurrent sessions are appropriately controlled.
Audit procedures:
Review procedures for controlling and auditing concurrent logons from
different workstations.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.15. Where appropriate, digital signatures, PKI, and electronic
signatures are effectively implemented.
Audit procedures:
Determine how nonrepudiation is assured and if PKI and
electronic/digital signatures are effectively implemented.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.16. PKI-based authentication:
* validates certificates by constructing a certification path to an
accepted trust anchor;
* establishes user control of the corresponding private key; and;
* maps the authenticated identity to the user account.
Audit procedures:
Review pertinent entity policies and procedures; assess procedures for
generating and communicating certificates to users; interview users;
review security software certificate parameters; obtain the help of
experts if needed.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.17. Authentication information is obscured (e.g., password is
not displayed).
Audit procedures:
Review procedures for controlling the display of authentication
information.
Control activity:
AC-2.1. Users are appropriately identified and authenticated.
Control techniques:
AC-2.1.18. Appropriate session-level controls are implemented (e.g.,
name/address resolution service, session authenticity).
Audit procedures:
Assess the adequacy of session-level controls.
Source: GAO.
[End of table]
Critical Element AC-3. Implement effective authorization controls:
Once a user is authenticated, authorization[Footnote 63] is used to
allow or prevent actions by that user based on predefined rules.
Authorization includes the principles of legitimate use, least
privilege, and separation of duties (discussed in section 3.4).
Operating systems have some built-in authorization features such as
user rights and privileges, groups of users, and permissions for files
and folders. Network devices, such as routers, may have access control
lists that can be used to authorize users who can access and perform
certain actions on the device.
Access rights and privileges are used to implement security policies
that determine what a user can do after being allowed into the system.
Access rights, also known as permissions, allow the user to look, read,
or write to a certain file or directory. Privileges are a set of access
rights permitted by the access control system. In a Microsoft Windows�
system, rights are what give the user or members of a group the access
needed to perform management tasks or simply to access a system.
Information system access permissions are a Unix term that describe the
kind of access to files a user is granted. A set of permissions is
associated with every file and directory that determines who can read
it, write to it, or execute it. Only the owner of the file (or the
super user[Footnote 64]) can change these permissions. Maintaining
access rights, permissions, and privileges is one of the most important
aspects of administering system security.
AC-3.1. User accounts are appropriately controlled:
In order to adequately control user accounts, an entity should
institute policies and procedures for authorizing logical access to
information resources and document such authorizations. These policies
and procedures should cover user access needed for routine operations,
emergency access, and the sharing and disposition of data with
individuals or groups outside the entity. Further, logical access
controls should enforce segregation of duties.
The computer resource owner should identify the specific user or class
of users authorized to obtain direct access to each resource for which
they are responsible. Access should be limited to individuals with a
valid business purpose (least privilege). Unnecessary accounts
(default, guest accounts) should be removed, disabled, or otherwise
secured. This process can be simplified by developing standard
profiles, which describe access needs for groups of users with similar
duties, such as accounts payable clerks.
The owner should also identify the nature and extent of access to each
resource that is available to each user. This is referred to as the
user�s profile. In general, users may be assigned one or more of the
following types of access to specific computer resources:
* read access�the ability to look at and copy data or a software
program;
* update access�the ability to change data or a software program;
* delete access�the ability to erase or remove data or programs;
* merge access�the ability to combine data from two separate sources;
* execute access�the ability to execute a software program.
Access may be permitted at the file, record, or field level. Files are
composed of records, typically one for each item or transaction.
Individual records are composed of fields that contain specific data
elements relating to each record.
Owners should periodically review access authorization listings and
determine whether they remain appropriate. Access authorizations should
be documented on standard forms and maintained on file. Listings of
authorized users and their specific access needs and any modifications
should be approved by an appropriate senior manager and directly
communicated in writing by the resource owner to the security
management function. A formal process for transmitting these
authorizations, including the use of standardized access request forms,
should be established to reduce the risk of mishandling, alterations,
and misunderstandings.
Security managers should review access authorizations for new or
modified access privileges and discuss any questionable authorizations
with the resource owners (authorizing officials).
Approved authorizations should be maintained on file. Compliance with
access authorizations should be monitored by periodically comparing
authorizations to actual access activity. Access control software
typically provides a means of reporting user access authorizations and
access activity. All changes to security access authorizations should
be automatically logged and periodically reviewed by management
independent of the security function. Unusual activity should then be
investigated.
Broad or special access privileges, such as those associated with
operating system software that allow normal controls to be overridden,
are only appropriate for a small number of users who perform system
maintenance or manage emergency situations. Such special privileges may
be granted on a permanent or temporary basis. However, any such access
should also be approved by a senior security manager, written
justifications should be kept on file, and the use of highly sensitive
files or access privileges should be routinely reviewed by management.
Special access privileges, access to sensitive files, and related audit
procedures are covered in section AC-4.1.
For systems that can be accessed through public telecommunications
lines, some users may be granted dial-up access. This means that these
individuals can use a modem to access and use the system from a remote
location, such as their home or a field office. Because such access can
significantly increase the risk of unauthorized access, it should be
limited and the associated risks weighed against the benefits. To help
manage the risk of dial-up access, justification for such access should
be documented and approved by owners. (See section AC-1 for controls to
help manage the risks of dial-up access, such as dial-back procedures
to preauthorized phone numbers or the use of security modems, tokens,
or smart cards to authenticate a valid user.)
Inactive accounts and accounts for terminated individuals should be
disabled or removed in a timely manner. It is important to notify the
security function immediately when an employee is terminated or, for
some other reason, is no longer authorized access to information
resources.
Notification may be provided by the human resources department or by
others, but policies should exist that clearly assign responsibility
for such notification. Terminated employees who continue to have access
to critical or sensitive resources pose a major threat, as do
individuals who may have left under acrimonious circumstances.
Owners should determine disposition and sharing of data. A mechanism
should be established so that the owners of data files and programs
determine whether and when these resources are to be maintained,
archived, or deleted. Standard disposition forms can be used and
maintained on file to document the users� approvals. In addition,
resource owners should determine if, with whom, and by what means
information resources can be shared. When files are shared with other
entities, it is important that (1) data owners understand the related
risks and approve such sharing and (2) receiving entities understand
the sensitivity of the data involved and safeguard the data
accordingly. This should require a written agreement before sensitive
information is shared.
Required access to shared file systems should be restricted to the
extent possible (for example, only to particular hosts, and only for
the level of access required). Many scientific agencies, such as the
National Aeronautics and Space Administration (NASA) and the National
Institutes of Health (NIH) use file sharing networks. File sharing
facilitates connections between persons who are looking for certain
types of files. A type of file sharing known as peer-to-peer (P2P)
refers to any software or system allowing individual users of the
Internet to connect directly to each other and trade files. While there
are many appropriate uses of this technology, several studies show that
the vast majority of files traded on P2P networks are copyrighted music
files and pornography. Data also suggest that P2P is a common avenue
for the spread of computer viruses within IT systems. As required by
FISMA, agencies are to use existing NIST standards and guidance to
complete system risk and impact assessments in developing security
plans and authorizing systems for operation. Operational controls
detailing procedures for handling and distributing information and
management controls outlining rules of behavior for users should ensure
that proper controls are in place to prevent and detect improper file
sharing.[Footnote 65]
Emergency and temporary access authorization needs to be controlled.
Occasionally, there will be a need to grant temporary access privileges
to an individual who is not usually authorized access. Such a need may
arise during emergency situations, when an individual is temporarily
assigned duties that require access to critical or sensitive resources,
or for service or maintenance personnel. In addition, contractor
personnel may require temporary access while involved in systems
development or other work. As with normal access authorizations,
temporary access should be approved and documented and the related
documentation maintained on file. Temporary user identifications and
authentication devices, such as passwords, should be designed to
automatically expire after a designated date. Also, management should
periodically review emergency and temporary access accounts to
determine that they are still necessary.
AC-3.2. Processes and services are adequately controlled:
Only authorized processes and services should be permitted in
information systems and they should be limited to what is essential to
effectively perform an agency�s mission and business functions. In an
information system, processes are systematic sequences of operations to
produce a specified result. This includes all functions performed
within a computer such as editing, calculating, summarizing,
categorizing, and updating. Services refer to �customer or product-
related business functions� such as file transfer protocol (FTP),
hypertext transfer protocol (HTTP), and mainframe supervisor calls.
Each system provides a set of services. For example, a computer network
allows its users to send packets to specified destinations; a database
system responds to queries; and a processor performs a number of
different instructions.
Controls related to processes and services include all of the
technological and managerial safeguards established and applied to an
information system to protect hardware, software, and data from
accidental or malicious modification, destruction, or disclosure.
When evaluating an agency�s processes and services, it is important to
consider the following:
* available processes and services should be minimized,
* the functions and purposes of processes and services should be
documented and approved by management, and,
* information available to unauthorized users should be restricted.
Proper control of information system processes and services is critical
to ensuring the confidentiality, integrity, and availability of user
data and, ultimately, the accomplishment of an agency�s mission. Access
control policies and enforcement mechanisms are employed by entities to
control access between users (or processes acting on behalf of users)
and objects (for example, segments, devices, files, records, fields,
processes, programs) in the information system. Access control policies
can be identity-based, role-based, or rule-based. [Footnote 66]
Associated enforcement mechanisms include access control lists, access
control matrices, and cryptography. Where encryption of stored
information is used as an access enforcement mechanism, the
cryptography used should be in compliance with applicable standards.
Configuring systems only for necessary capabilities minimizes processes
and services. First, only required services should be installed.
Second, the number of individuals with access to such services should
be restricted based on the concept of least privilege; this means that
users should have the least amount of privileges (access to services)
necessary to perform their duties. Third, the use of information
services needs to be monitored. Fourth, it is important to maintain
current service versions. According to NIST guidance, the information
system should be periodically reviewed to identify and eliminate
unnecessary services (for example, FTP, HTTP, mainframe supervisor
calls) and protocols that would introduce an unacceptable level of risk
should be disabled.[Footnote 67] The information system that supports
the server functionality should be, as much as possible, dedicated to
that purpose. In addition, the function and purpose of processes and
services should be documented and approved by appropriate entity
officials.
According to NIST SP 800-53, additional process and service controls
should be implemented to:
* prohibit remote activation of collaborative computing mechanisms
(e.g. video and audio devices),
* ensure that lower priority process do not interfere with higher
priority processes, and,
* ensure proprietary information and applications is protected from
processes and systems available to the public.
AC-3 Related NIST SP-800-53 Controls:
AC-2 Account Management;
AC-3 Access Enforcement;
AC-6 Least Privilege;
CM-7 Least Functionality;
SC-6 Resource Priority;
SC-14 Public Access Protections;
SC-15 Collaborative Computing.
Control Techniques and Suggested Audit Procedures for Critical Element
AC-3:
Table 18. Control Techniques and Suggested Audit Procedures for
Critical Element AC-3: Implement effective authorization controls:
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.1. Resource owners have identified authorized users and the
access they are authorized to have.
Audit procedures:
These audit procedures should be coordinated with section 3.4
(segregation of duties) to ensure that users do not have access to
incompatible functions. Review written policies and procedures; for a
selection of users (both application and information security
personnel), review access authorization documentation and applicable
rights and privileges in the information system.
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.2. Security administration personnel set parameters of security
software to provide access as authorized and restrict access that has
not been authorized. This includes access to data files, load and
source code libraries (if applicable), security files, and operating
system files. Standard naming conventions are established and used
effectively as a basis for controlling access to data, and programs.
Audit procedures:
Determine directory names for sensitive or critical files and obtain
security reports of related access rules. Using these reports,
determine who has access to sensitive files and whether the access
matches the level and type of access authorized. Determine whether
standard naming conventions are established and used effectively.
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.3. Security managers review access authorizations and discuss
any questionable authorizations with resource owners.
Audit procedures:
Interview security managers and review documentation provided to them.
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.4. All changes to security access authorizations are
automatically logged and periodically reviewed by management
independent of the security function; unusual activity is investigated.
Audit procedures:
Review a selection of recent changes to security access authorizations
and related logs for evidence of management review and unusual
activity; determine if unusual activity is being/has been investigated.
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.5. Resource owners periodically review access authorizations for
continuing appropriateness.
Audit procedures:
Interview owners and review supporting documentation; determine whether
inappropriate access rights are removed in a timely manner.
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.6. Access is limited to individuals with a valid business
purpose (least privilege).
Audit procedures:
Identify who has access to user accounts and sensitive system resources
and the business purpose for this access.
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.7. Unnecessary accounts (default, guest accounts) are removed,
disabled, or otherwise secured.
Audit procedures:
Verify that unnecessary accounts are removed, disabled, or secured.
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.8. Inactive accounts and accounts for terminated individuals are
disabled or removed in a timely manner.
Audit procedures:
Review security software parameters; review system-generated list of
inactive logon IDs, and determine why access for these users has not
been terminated. Obtain a list of recently terminated employees from
Personnel and, for a selection, determine whether system access was
promptly terminated.
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.9. Access to shared file systems are restricted to the extent
possible (for example, only to particular hosts, and only for the level
of access required).
Audit procedures:
Determine how access to shared file systems is restricted and verify
that it works effectively.
Control activity:
AC-3.1. User accounts are appropriately controlled.
Control techniques:
AC-3.1.10. Emergency or temporary access is appropriately controlled,
including:
* documented and maintained,
* approved by appropriate managers,
* securely communicated to the security function,
* automatically terminated after a predetermined period, and,
* all activity is logged.
Audit procedures:
Review pertinent policies and procedures; compare a selection of both
expired and active temporary and emergency authorizations (obtained
from authorizing parties) with a system-generated list of authorized
users. Determine the appropriateness of access documentation and
approvals and the timeliness of terminating access authorization when
no longer needed.
Control activity:
AC-3.2. Processes and services are adequately controlled.
Control techniques:
AC-3.2.1. Available processes and services are minimized, such as
through:
* installing only required processes and services based on least
functionality,
* restricting the number of individuals with access to such services
based on least privilege,
* monitoring the use of such services, and,
* maintaining current service versions.
Audit procedures:
Review procedures for minimizing processes and services; interview
system administrator; identify what services are installed and
determine if they are required; determine who has access to these
services and if they need them; determine how access to these services
is monitored; and determine if the service versions are kept current.
If appropriate, scan for poorly configured, unnecessary, and dangerous
processes and services.
Control activity:
AC-3.2. Processes and services are adequately controlled.
Control techniques:
AC-3.2.2. The function and purpose of processes and services are
documented and approved by management.
Audit procedures:
Obtain documentation describing the function and purpose of processes
and services, and evidence of management approval.
Control activity:
AC-3.2. Processes and services are adequately controlled.
Control techniques:
AC-3.2.3. Information available to potential unauthorized users is
appropriately restricted.
Audit procedures:
Determine if information about available processes and services is
appropriately restricted.
Control activity:
AC-3.2. Processes and services are adequately controlled.
Control techniques:
AC-3.2.4. The information system prohibits remote activation of
collaborative computing mechanisms (for example, video and audio
conferencing) and provides an explicit indication of use to the local
users (for example, use of camera or microphone).
Audit procedures:
Determine if remote activation of collaborative computing services have
been physically disconnected.
Control activity:
AC-3.2. Processes and services are adequately controlled.
Control techniques:
AC-3.2.5. The information system limits the use of resources by
priority. (Priority protection ensures that a lower-priority process is
not able to interfere with the information system servicing any higher-
priority process.)
Audit procedures:
Interview the systems administrator and review appropriate systems
documentation.
Control activity:
AC-3.2. Processes and services are adequately controlled.
Control techniques:
AC-3.2.6. For publicly available systems, the information system
controls protect the integrity and availability of the information and
applications.
Audit procedures:
Identify controls used to protect the integrity and availability of the
information and applications on such systems and test controls to
ensure their effectiveness.
Source: GAO.
[End of table]
Critical Element AC-4. Adequately protect sensitive system resources:
Certain system resources are more sensitive than others because, if
compromised, serious security breaches could occur. Three areas related
to sensitive system resources are: (1) restricting and monitoring
access, (2) implementing adequate media controls over sensitive data,
and (3) where appropriate, implementing effective cryptographic
controls. Such sensitive system resources include system software,
system utilities, configuration management systems, file maintenance
systems, security software, data communications systems, and database
management systems. Restricting access to sensitive system resources
such as system software and related documentation is critical to
controlling the overall integrity of information systems. For example,
if system software is not adequately protected, an individual could
gain access to capabilities that would allow him or her to bypass
security features found in either operating system security software or
access controls built into application software. The individual would
then be able to read, modify, or destroy application programs, master
data files, and transaction data, and subsequently erase any electronic
audit trail of his or her activities. In addition, inadequate media
controls can result in a loss of confidentiality of sensitive data.
Further, cryptographic controls may be needed to protect sensitive
information where it is not otherwise possible or practical to
adequately restrict access through either physical or logical access
controls.
AC-4.1. Access to sensitive system resources is restricted and
monitored:
Access to sensitive system resources, such as system software and
powerful system utilities, should be appropriately restricted and
monitored. System software is a set of programs designed to operate and
control the processing activities of computer equipment. Generally, one
set of system software is used to support and control a variety of
applications that may run on the same computer hardware. System
software helps control and coordinates the input, processing, output,
and data storage associated with all of the applications that run on a
system. Some system software can change data and program code on files
without leaving an audit trail. The following are examples of system
software:
* operating system software;
* system utilities;
* configuration management systems;
* file maintenance software;
* security software;
* data communications systems;
* database management systems.
Access to sensitive system resources should be restricted to
individuals or processes that have a legitimate need for this access
for the purposes of accomplishing a valid business purpose. For
example, access to system software should be restricted to a limited
number of personnel who have job responsibilities associated with the
use of that software. Responsibilities for using system utilities
should be clearly defined and understood by systems programmers.
Application programmers and computer operators should be specifically
prohibited from accessing system software. Justification and approval
by appropriate entity officials for access to system software should be
documented and retained. Appropriate entity officials should
periodically review the use of privileged system software and utilities
to ensure that access permissions correspond with position descriptions
and job duties. Further, the use of sensitive/privileged accounts
should be adequately monitored. Responsibilities for monitoring use
should be clearly defined and understood by entity officials.
Typically, access to operating system software is restricted to a few
systems programmers whose job it is to modify the system, when needed,
and intervene when the system will not operate properly. In addition,
database administrators need access to the system�s database management
system and a designated senior-level security administrator needs
access to security software. However, application programmers and
computer operators should not have access to system software, as this
would be incompatible with their assigned responsibilities and could
allow unauthorized actions to occur. (See section 3.4 for details on
segregation of duties.)
The number of personnel authorized to access the system will vary
depending on the size and needs of the entity and, therefore, should be
determined based on an analysis of the agency�s operations. For
example, a large entity that must maintain operations on a 24-hour
basis will need more operating systems analysts and programmers than a
smaller entity that operates on a less intensive schedule. There may be
a tendency for entities to authorize access to many individuals so that
emergency operating problems can be handled promptly. However,
management should balance the need for efficiency with the need for
security.
Because of the powerful capabilities at the disposal of those who have
access to system software and related tools, use of the tools should be
adequately controlled and monitored to identify any inappropriate or
unusual behavior. Such behavior may indicate unauthorized access or an
individual who is improperly exploiting access privileges. For example,
greater than normal use of system software or use at odd hours may
indicate that an individual is using the software to search for system
weaknesses to exploit or to make unauthorized changes to system or
application software or data. For monitoring to be effective in both
detecting and deterring inappropriate use, personnel authorized to use
system software should understand which uses are appropriate and which
are not and also that their activities may be monitored. Such policies
should be documented and distributed to all personnel.
Policies and techniques should be implemented for using and monitoring
the use of system tools and utilities. Some system utilities are used
to perform system maintenance routines that are frequently required
during normal processing operations. Other utilities aid the
development and documentation of applications systems. These utilities
can aid individuals who have fraudulent or malicious intentions in
understanding how the programs or data in an application system operate
and in how to make unauthorized modifications.
Following is a listing of some utilities with their intended functions
that could be misused without proper monitoring and control:
* Flowcharters, transaction profile analyzers, execution path
analyzers, and data dictionaries can be used to understand application
systems.
* Data manipulation utilities, data comparison utilities, and query
facilities can be used to access and view data, with manipulation
utilities also allowing data modification.
* Online debugging facilities permit online changes to program object
code leaving no audit trail and can activate programs at selected start
points.
* Library copiers can copy source code from a library into a program,
text and online editors permit modification of program source code, and
online coding facilities permit programs to be coded and compiled in an
interactive mode.
To prevent or detect the misuse of systems utilities, policies should
be clearly documented regarding their use. In addition, the use of
utilities should be monitored. Generally, system software contains a
feature that provides for logging and reporting of its use. Such
reports should identify when and by whom the software was used. It is
important that this software operation work properly and that the
reports are reviewed on a regular basis.
The availability of standard usage data may assist the systems manager
in identifying unusual activity. Some systems can be designed to
compare standard usage data with actual use and report significant
variances, thus making it easier for the system manager to identify
unusual activity. When questionable activity is identified, it should
be investigated. If improper activity is determined to have occurred,
in accordance with security violation policies, the incident(s) should
be documented, appropriate disciplinary action taken, and, when
appropriate, higher-level management notified. Further, the possibility
of damage or alteration to the system software, application software,
and related data files should be investigated and corrective action
taken if needed. Such action should include notifying the resource
owner of the violation.
In addition to controlling access to sensitive system resources, it is
also important to control a number of other activities. First, default
permissions and rights to system software and network devices should be
changed during installation. Second, system libraries should be
appropriately controlled. For example, the migration of system software
from the testing environment to the production environment may be
performed, after approval, by an independent library control group.
Outdated versions of system software should be removed from the
production environment to preclude their use. Some changes may be made
specifically to correct security or integrity vulnerabilities, and
using outdated versions allows the agency�s data and systems to remain
exposed to these vulnerabilities. Third, access to authentication
services and directories should also be appropriately controlled.
Finally, access to mobile code[Footnote 68] (see next paragraph) should
be appropriately controlled due to its potential to cause damage to the
information system if used maliciously.
Mobile code refers to programs (for example, script, macro, or other
portable instruction) that can be shipped unchanged to a heterogeneous
collection of platforms and executed with identical semantics. Being
able to download files and electronic documents off the Internet is a
useful function and a common practice today. Web pages serve as an
electronic counterpart to paper documents; however, unlike paper
documents, Web pages can entail active content that is capable of
delivering digitally encoded multimedia information enlivened through
embedded computer instructions. The popularity of the World Wide Web
has spurred the trend toward active content. A dynamic weather map, a
stock ticker, and live camera views or programmed broadcasts appearing
on a Web page are common examples of the use of this technology. Like
any technology, active content can provide a useful capability, but can
also become a source of vulnerability for an attacker to exploit.
Mobile code controls should include registration, approval, and control
procedures to prevent the development, acquisition, or introduction of
unacceptable mobile code within the information system. All mobile code
or executable content employed should be registered unless otherwise
approved by the authorizing official. Uploading of mobile code or
executable content from one organizational information system to
another should also be similarly authorized.
Sensitive system resources may be further protected by partitioning
applications, isolating security functions, and establishing a trusted
communication path. First of all, through application partitioning, the
information system physically or logically separates user interface
services (for example, public Web pages) from information storage and
management services (for example, database management). Separation may
be accomplished through the use of different computers, different
central processing units, different instances of the operating system,
different network addresses, combinations of these methods, or other
methods as appropriate. Secondly, it is desirable for the information
system to isolate security functions from nonsecurity functions by
means of partitions, domains, etc., including control of access to and
integrity of the hardware, software, and firmware that perform those
security functions. The information system maintains a separate
execution domain (for example, address space) for each executing
process. Thirdly, the information system should establish a trusted
communication path between the user and the security functionality of
the system. Technical experts may be needed to examine and test these
controls. Finally, as appropriate, controls should be in place over
information leakage through electromagnetic signals emanations.
AC-4.2. Adequate media controls have been implemented:
Media controls should be implemented to control unauthorized physical
access to digital and printed media removed from the information system
and during pick up, transport, and delivery to authorized users. Media
should also be properly labeled to identify its sensitivity and
distribution limitations. Finally, all sensitive information should be
removed from media before its disposal or transfer to another use.
As discussed in NIST SP 800-53, information system media includes both
digital media (e.g., diskettes, magnetic tapes, external/removable hard
drives, flash/thumb drives, compact disks, digital video disks) and non-
digital media (e.g., paper, microfilm). Media controls also apply to
portable and mobile computing and communications devices with
information storage capability (e.g., notebook computers, personal
digital assistants, cellular telephones).
NIST SP 800-53 also states that an organizational assessment of risk
guides the selection of media and associated information contained on
that media requiring restricted access. Organizations document in
policy and procedures, the media requiring restricted access,
individuals authorized to access the media, and the specific measures
taken to restrict access. The rigor with which this control is applied
is commensurate with the FIPS 199 security categorization of the
information contained on the media. For example, fewer protection
measures are needed for media containing information determined by the
organization to be in the public domain, to be publicly releasable, or
to have limited or no adverse impact on the organization or individuals
if accessed by other than authorized personnel. In these situations, it
is assumed that the physical access controls where the media resides
provide adequate protection.
One sensitive area is the storage of personally identifiable
information on portable media. The ability to store and transport
substantial volumes of data on portable devices creates an additional
exposure to information confidentiality. The entity should have
adequate controls in place over such portable media. OMB Memorandum M-
06-16 recommends federal agencies encrypt all data on mobile
computers/devices which carry agency data unless the data is determined
to be non-sensitive, in writing, by the agency�s Deputy Secretary or an
individual they may designate in writing.
In addition, as part of the risk assessment process, entities should
identify information that is sensitive, including personally
identifiable information. Entities should implement controls to
adequately protect the confidentiality of such information, including
any copies of such data. OMB Memorandum M-06-16 recommends federal
agencies to log all computer-readable data extracts from databases
holding sensitive information and verify each extract including
sensitive data has been erased within 90 days or its use is still
required. This OMB Memorandum provides additional guidance on controls
over personally identifiable and other sensitive information. Also see
AC-1.2 and AC-2.1. Automated marking and labeling of information helps
to enforce information security access policy. Information system
outputs should be marked using standard naming conventions to identify
any special dissemination, handling, or distribution instructions.
Similarly, information in storage, in process, and transmission should
be appropriately labeled. Further, a means should be provided for the
information system to ensure that the labels a user associates with
information provided to the system are consistent with the information
that the user is allowed to access. It is important that security
parameters are exchanged between systems to authenticate services
requested by another system. Security parameters include, for example,
security labels and markings. Security parameters may be explicitly or
implicitly associated with the information contained within the
information system.
The entity should have policies and procedures in place to remove
sensitive information[Footnote 69] and software from computers, disks,
and other equipment or media when they are disposed of or transferred
to another use. Further, approved equipment and techniques should be
used and periodically tested to ensure correct performance. If
sensitive information is not fully cleared, it may be recovered and
inappropriately used or disclosed by individuals who have access to the
discarded or transferred equipment and media. The responsibility for
clearing information should be clearly assigned. Also, standard forms
or a log should be used to document that all discarded or transferred
items are examined for sensitive information and that this information
is cleared before the items are released.
AC-4.3. Cryptographic controls are effectively used:
Where appropriate, cryptographic tools help provide access control by
rendering data unintelligible to unauthorized users and/or protecting
the integrity of transmitted or stored data. In some cases�especially
those involving telecommunications�it is not possible or practical to
adequately restrict access through either physical or logical access
controls. In these cases, cryptographic tools can be used to identify
and authenticate users and help protect the integrity and
confidentiality of data and computer programs, both while these data
and programs are �in� the computer system and while they are being
transmitted to another computer system or stored on removable media.
As discussed in FIPS Pub 140-2, cryptographic-based security systems
may be utilized in various computer and telecommunication applications
(e.g., data storage, access control and personal identification,
network communications, radio, facsimile, and video) and in various
environments (e.g., centralized computer facilities, office
environments, and hostile environments). The cryptographic services
(e.g., encryption, authentication, digital signature, and key
management) provided by a cryptographic module are based on many
factors that are specific to the application and environment. The
security level to which a cryptographic module is validated should be
chosen to provide a level of security appropriate for the security
requirements of the application and environment in which the module
will be utilized and the security services that the module will
provide. The security requirements for a particular security level
include both the security requirements specific to that level and the
security requirements that apply to all modules regardless of the
level.
Cryptography involves the use of algorithms (mathematical formulae) and
combinations of keys (strings of bits) to do any or all of the
following:
* encrypt, or electronically scramble a message or file so that it is
unintelligible to those who do not have the secret key needed to
decrypt it, thus keeping the contents of the message or file
confidential,
* provide an electronic signature that can be used to determine if any
changes have been made to the related file, thus ensuring the file�s
integrity, and,
* link a message or document to a specific individual�s or group�s key,
thus ensuring that the �signer� of the file can be identified.
Cryptographic tools are especially valuable for any application that
involves �paperless� transactions or for which the users want to avoid
relying on paper documents to substantiate data integrity and validity.
Examples include:
* electronic commerce, where purchase orders, receiving reports, and
invoices are created, approved, and transmitted electronically;
* travel administration, where travel orders and travel vouchers are
created, approved, and transmitted electronically; and;
* protection of documents or digital images, such as contracts,
personnel records, or diagrams, which are stored on electronic media.
Cryptographic tools may be linked to an individual application or
implemented so that they can be used to sign or encrypt data associated
with multiple applications. For example, the personal computers
connected to a local area network may each be fitted with hardware
and/or software that identifies and authenticates users and allows them
to encrypt, sign, and authenticate the messages and files that they
send or receive, regardless of the application that they are using.
There are a number of technical issues to consider concerning
cryptography. Some of the key considerations are listed here.
* Are the cryptographic tools implemented in software or through the
use of a hardware module? (Hardware modules are generally more secure.)
* How is the data transmitted between the computer�s memory and the
cryptographic module, and is this path protected?
* How strong, or complex, is the algorithm used to encrypt and sign
data?
* How are keys managed and distributed?
* Does the agency�s use of cryptographic tools comply with related
Federal Information Processing Standards issued by NIST?
* Has the entity chosen cryptographic techniques that are appropriate
to cost-effectively meet its defined control objectives?
If the auditor encounters cryptographic tools and determines that their
reliability is important to his or her understanding of the controls,
they should obtain the most recent guidance available from OMB, NIST,
and GAO, as well as technical assistance from an auditor experienced in
assessing cryptographic tools.
Control Techniques and Suggested Audit Procedures for Critical Element
AC-4:
AC-4 Related NIST SP-800-53 Controls:
AC-15 Automated Marking;
AC-16 Automated Labeling;
IA-7 Cryptographic Module Authentication;
MP-2 Media Access;
MP-3 Media Labeling;
MP-4 Media Storage;
MP-5 Media Transport;
MP-6 Media Sanitization and Disposal;
PE-19 Information Leakage;
SC-2 Application Partitioning;
SC-3 Security Function Isolation;
SC-4 Information Remnance;
SC-8 Transmission Integrity;
SC-9 Transmission Confidentiality;
SC-11 Trusted Path;
SC-12 Cryptographic Key Establishment and Management;
SC-13 Use of Cryptography;
SC-16 Transmission of Security Parameters;
SC-18 Mobile Code.
Table 19. Control Techniques and Suggested Audit Procedures for
Critical Element AC-4: Adequately protect sensitive system resources:
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
Review pertinent policies and procedures.
Audit procedures:
Interview management and systems personnel regarding access
restrictions.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.1. Access to sensitive/privileged accounts is restricted to
individuals or processes having a legitimate need for the purposes of
accomplishing a valid business purpose.
Audit procedures:
Identify and test who has access to sensitive/privileged accounts and
determine the reason for that access.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.2. Use of sensitive/privileged accounts is adequately monitored.
Audit procedures:
Determine if the use of sensitive and privileged accounts is monitored
and evaluate its effectiveness.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.3. Logical access to utilities and tools is adequately
controlled (for example, remote maintenance).
Audit procedures:
Determine the last time the access capabilities of system programmers
were reviewed. Review security software settings to identify types of
activity logged. Observe personnel accessing system software, such as
sensitive utilities and note the controls encountered to gain access.
Attempt to access the operating system and other system software.
Select some application programmers and determine whether they are
authorized access.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.4. System libraries are appropriately controlled.
Audit procedures:
Determine if access to system libraries is adequately controlled.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.5. Passwords/authentication services and directories are
appropriately controlled and encrypted when appropriate.
Audit procedures:
Determine if password files and authentication services are adequately
protected from unauthorized access.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.6. Mobile code is appropriately controlled.
Audit procedures:
Interview system administrator and determine if mobile code is
adequately controlled.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.7. Where appropriate, access is restricted based on time and/or
location.
Audit procedures:
Determine if access is appropriately restricted based on time and/or
location.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.8. The information system partitions or separates user
functionality (including user interface services) from information
system management functionality.
Audit procedures:
Interview officials and review related system documentation. Coordinate
with vulnerability analysis.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.9. The information system isolates security functions from
nonsecurity functions.
Audit procedures:
Interview officials and review related system documentation. Coordinate
with vulnerability analysis.
Control activity: AC-4.1. Access to sensitive system resources is
restricted and monitored.
Control techniques:
AC-4.1.10. The information system establishes a trusted communications
path between the user and the security functionality of the system.
Audit procedures:
Interview officials with system and communication responsibilities and
examine appropriate records such as developer design documents.
Control activity: AC-4.2. Adequate media controls have been
implemented.
Control techniques:
AC-4.2.1. Only authorized users have access to printed and digital
media removed from the information system.
Audit procedures:
Interview personnel and review procedures. Observe entity practices and
review selected access logs.
Control activity: AC-4.2. Adequate media controls have been
implemented.
Control techniques:
AC-4.2.2. The information system automatically identifies how
information is to be used:
* output is marked using standard naming conventions, and;
* internal data in storage, process and transmission is labeled.
Audit procedures:
Interview appropriate personnel. For output, identify standard naming
conventions and examine the system configuration. For internal data,
examine the labeling mechanism and internal data for accurate labels.
Test output and internal data for appropriate results.
Control activity: AC-4.2. Adequate media controls have been
implemented.
Control techniques:
AC-4.2.3. The organization controls the pickup, transport, and delivery
of information system media (paper and electronic) to authorized
personnel.
Audit procedures:
Interview officials and review appropriate policy and procedures.
Observe selected media transport practices and receipts.
Control activity: AC-4.2. Adequate media controls have been
implemented.
Control techniques:
AC-4.2.4. Systems media is securely stored according to its
sensitivity.
Audit procedures:
Determine if media storage practices are adequate and comply with
applicable requirements (for federal agencies, FIPS 199 security
categories).
Control activity: AC-4.2. Adequate media controls have been
implemented.
Control techniques:
AC-4.2.5. Security parameters are clearly associated with information
exchanged between information systems.
Audit procedures:
Determine if security parameters are clearly associated with
information exchanged.
Control activity: AC-4.2. Adequate media controls have been
implemented.
Control techniques:
AC-4.2.6. Approved equipment, techniques, and procedures are
implemented to clear sensitive data from digital media before its
disposal or release for reuse outside of the organization.
Audit procedures:
Review written procedures; interview personnel responsible for clearing
data from digital media. For a selection of recently discarded or
transferred items, examine documentation related to clearing of data
and disposal of software. For selected items still in the agency�s
possession, test to determine whether they have been appropriately
sanitized.
Control activity: AC-4.3. Cryptographic controls are effectively used.
Control techniques:
AC-4.3.1. Cryptographic tools have been implemented to protect the
integrity and confidentiality of sensitive and critical data and
software programs.
Audit procedures:
Determine if cryptographic tools are properly implemented. (See NIST
standards for federal agencies) To evaluate the use of cryptographic
tools, the auditor should obtain the assistance of a specialist.
Control activity: AC-4.3. Cryptographic controls are effectively used.
Control techniques:
AC-4.3.2. Encryption procedures are implemented in data communications
where appropriate based on risk.
Audit procedures:
Capture passwords transmitted over the network and determine if they
are encrypted; for federal system, determine if cryptographic
authentication complies with FIPS 140-2. To evaluate cryptographic
tools, the auditor should obtain the assistance of a specialist.
Control activity: AC-4.3. Cryptographic controls are effectively used.
Control techniques:
AC-4.3.3. For authentication to a cryptographic module, the information
system employs appropriate authentication methods.
Audit procedures:
Interview appropriate officials and review supporting documentation.
For federal agencies, compare the authentication process to FIPS 140-2
requirements.
Control activity: AC-4.3. Cryptographic controls are effectively used.
Control techniques:
AC-4.3.4. The information system employs automated mechanisms with
supporting procedures or manual procedures for cryptographic key
establishment and key management.
Audit procedures:
Compare policy and practices to appropriate guidance, such as NIST
guidance in SP 800-56 and SP 800-57 for cryptographic key establishment
and management, respectively.
Source: GAO.
[End of table]
Critical Element AC-5. Implement an effective audit and monitoring
capability:
Audit and monitoring involves the regular collection, review, and
analysis of auditable events for indications of inappropriate or
unusual activity, and the appropriate investigation and reporting of
such activity. Automated mechanisms may be used to integrate audit
monitoring, analysis, and reporting into an overall process for
investigation and response to suspicious activities. Audit and
monitoring controls can help security professionals routinely assess
computer security, perform investigations during and after an attack,
and even recognize an ongoing attack. Audit and monitoring technologies
include network and host-based intrusion detection systems, audit
logging, security event correlation tools, and computer forensics.
Network-based intrusion detection systems (IDSs) capture or �sniff� and
analyze network traffic in various parts of a network. On the other
hand, host-based IDSs analyze activity on a particular computer or
host. Both types of IDS have advantages and disadvantages.
FISMA requires that each agency implement an information security
program that includes procedures for detecting, reporting, and
responding to security incidents. Further, OMB is to ensure the
operation of a central federal information security incident center to:
* provide timely technical assistance to system operators,
* compile and analyze incident information,
* inform system operators about threats and vulnerabilities, and;
* consult with NIST, national security agencies, and other designated
agencies such as the Department of Homeland Security.
NIST issued two relevant special publications that provide additional
information:
* SP 800-94, Guide to Intrusion Detection and Prevention Systems
(IDPS), and;
* SP 800-61, Computer Security Incident Handling Guide.
SP 800-61 discusses four steps in incident handling:
* preparation,
* detection and analysis,
* containment, eradication, and recovery, and,
* post-incident activity.
An IDS detects inappropriate, incorrect, or anomalous activity aimed at
disrupting the confidentiality, integrity, or availability of a
protected network and its computer systems. An IDS collects information
on a network, analyzes the information on the basis of a preconfigured
rule set, and then responds to the analysis. A description of the
technologies, their effectiveness, and how they work is described in
Technologies to Secure Federal Systems, GAO-04-467 (Washington, D.C.:
March 2004).
AC-5.1. An effective incident response program is documented and
approved:
An effective incident response program should be implemented. Control
techniques include:
* documented policies and procedures, including an incident response
plan;
* documented testing of the incident response plan;
* a means of prompt centralized reporting;
* active monitoring of alerts and advisories;
* response team members with the necessary knowledge, skills, and
abilities;
* training on roles and responsibilities and periodic refresher
training;
* links to other relevant groups;
* protection against denial of service attacks; and;
* appropriate incident response assistance and consideration of
computer forensics.
OMB tasks NIST with coordinating activities governmentwide for agencies
sharing information concerning common vulnerabilities and threats.
Finally, Appendix III of OMB Circular A-130 directs the Department of
Justice to provide appropriate guidance on pursuing legal remedies in
the case of serious incidents.
According to NIST, the two main benefits of an incident-handling
capability are (1) containing and repairing damage from incidents and
(2) preventing future damage. Other, less obvious, benefits of an
incident-handling capability include:
* improved threat data for use in the risk assessment and control
selection process,
* enhanced internal communication and organizational preparedness, and,
* enhanced training and awareness programs by providing trainers with
better information on users� knowledge and providing real-life
illustrations for classes.
Also, according to NIST, the characteristics of a good incident-
handling capability include:
* an understanding of the constituency being served, including computer
users and program managers;
* an educated constituency that trusts the incident-handling team;
* a means of prompt centralized reporting, such as through a hotline;
* a response team with the necessary knowledge, skills, and abilities,
including technical expertise with the computer technology used by the
agency, and the ability and willingness to respond when and where
needed; and,
* links to other groups�such as law enforcement agencies, response
teams, or security groups external to the agency�and to the agency�s
public relations office (in case the incident receives media
attention).
One aspect of incident response that can be especially problematic is
gathering the evidence to pursue legal action. Incident response
training and assistance is important for users of information systems
to understand the proper handling and reporting of security incidents.
Resources should be available to provide adequate computer forensics of
security incidents. To gather evidence, an entity may need to allow an
intruder or violator to continue his or her inappropriate activities�a
situation that puts the system and data at continued risk. However,
fear of detection and prosecution can serve as a deterrent to future
violations.
The United States Computer Emergency Readiness Team (US�CERT) was
established in September 2003 to provide a national incident response
capability. US�CERT is a partnership of the Department of Homeland
Security and the public and private sectors. Established to protect the
nation�s Internet infrastructure, US-CERT coordinates defense against
and responses to cyber attacks across the nation. Specifically, it is
responsible for analyzing and reducing cyber threats and
vulnerabilities, disseminating cyber threat warning information, and
coordinating incident response activities.
As the nation�s focal point for preventing, protecting against, and
responding to cyber security vulnerabilities, US�CERT interacts with
all federal agencies, private industry, the research community, state
and local governments, and others on a 24X7 basis to disseminate
reasoned and actionable cyber security information. To provide security
information to the public, US�CERT:
* integrates content contributed by numerous organizations from both
the public and private sectors,
* aggregates and analyzes the various types of data provided by
contributing organizations,
* serves as the focal point for promoting common and comprehensive
analysis of security trends and risks, and,
* maintains quality control standards and works to ensure technical
accuracy as well as timeliness.
Worldwide, there are more than 250 organizations that use the name CERT
or a similar name and deal with cyber security response. US�CERT and
the CERT Coordination Center at Carnegie Mellon University work jointly
on cyber security activities. When a cyber security problem warrants,
US-CERT coordinates a response by working with computer security
experts from public and private state and local incident response
teams. See [hyperlink, http://www.us-cert.gov/aboutus.html].
In addition, the incident response program is affected by and should be
responsive to the configuration of the entity�s networks. For example,
it can affect the placement of intrusion detection systems.
Also, the network and related access controls can be designed to aid in
containment of security breaches to limited areas of the network. Also,
the incident response program should appropriately consider treatment
of privacy information. Specifically, federal entities should comply
with applicable statutes and the following OMB Memoranda:
* M-06-15, Safeguarding Personally Identifiable Information (5/22/06);
* M-06-16, Protection of Sensitive Agency Information (6/23/06);
* M-06-19, Reporting Incidents Involving Personally Identifiable
Information and Incorporating the Cost for Security in Agency
Information Technology Investments (7/12/06);
* OMB Reporting Instructions for the Federal Information Security
Management Act and Agency Privacy Management (generally annual OMB
memorandums);
* Recommendations for Identity Theft Related Data Breach Notifications
(9/20/06);
* M-07-04, Use of Commercial Credit Monitoring Services Blanket
Purchase Agreements (12/22/06).
AC-5.2. Incidents are effectively identified and logged:
Entity policies and procedures should establish criteria for the
identification of significant system events that should be logged.
Based on such criteria, the entity should identify significant system
events. At a minimum, all such significant events,[Footnote 70]
including access to and modification of sensitive or critical system
resources, should be logged. However, to be effective:
* this feature should be activated to log critical activity, maintain
critical audit trails, and report unauthorized or unusual activity;
* access to audit logs should be adequately controlled; and;
* managers should review logs for unusual or suspicious activity and
take appropriate action.
Access control software should be used to maintain an audit trail of
security access containing appropriate information for effective review
to determine how, when, and by whom specific actions were taken. For
example, time stamps of audit records should be generated using
internal information system clocks that are synchronized systemwide.
Such information is critical to monitoring compliance with security
policies and when investigating security incidents. The settings of the
access control software control the nature and extent of audit trail
information provided. Typically, audit trails may include user ID,
resource accessed, date, time, terminal location, and specific data
modified. The information system should have the capability to
determine whether or not a given individual took a particular action
(non-repudiation).
The completeness and value of the audit trails maintained will only be
as good as the agency�s ability to thoroughly identify the critical
processes and the related information that may be needed. Procedures
for maintaining such audit trails should be based on:
* the value or sensitivity of data and other resources affected;
* the processing environment, for example, systems development,
testing, or production;
* technical feasibility; and;
* legal and regulatory requirements.
Audit trails, including automated logs, need to be retained for an
appropriate period of time. Therefore, the entity needs to allocate
sufficient audit record storage capacity and configure auditing to
prevent the storage capacity from being exceeded. The information
system should provide a warning when storage capacity reaches a certain
level. If storage capacity is reached, the system should alert
appropriate officials and take appropriate, predefined actions such as
saving the oldest data offline, shutting down the system, overwriting
the oldest audit records, or stop generating audit records.
An effective intrusion detection system (IDS) should be implemented,
including appropriate placement of intrusion-detection sensors and
setting of incident thresholds. IDS security software generally
provides a means of determining the source of a transaction or an
attempted transaction and of monitoring users� activities (audit
trail).
AC-5.3. Incidents are properly analyzed and appropriate actions taken:
Because all of the audit trail and log information maintained is likely
to be too voluminous to review on a routine basis, the IDS security
software should be implemented to selectively identify unauthorized,
unusual, and sensitive access activity, such as:
* attempted unauthorized logical and physical access;
* access trends and deviations from those trends;
* access to sensitive data and resources;
* highly-sensitive privileged access, such as the ability to override
security controls;
* access modifications made by security personnel; and;
* unsuccessful attempts to logon to a system.
Modern information systems may have an audit-reduction and report-
generation capability to automatically process audit records for events
of interest based on selectable event criteria. The security software
should be designed to report such activity and, in some cases, respond
by actions such as:
* disabling passwords,
* terminating repeated failed attempts to access sensitive resources,
* terminating processing,
* shutting down terminals,
* issuing warning or error messages, and,
* writing audit trail records that would not normally be maintained.
Once unauthorized, unusual, or sensitive access activity is identified,
it should be reviewed and apparent or suspected violations
investigated. If it is determined that a security violation has
occurred, appropriate action should be taken to identify and remedy the
control weaknesses that allowed the violation to occur, repair any
damage that has been done, and determine and discipline the
perpetrator. It is important that an entity have formal written
procedures for reporting security violations or suspected violations to
a central security management office so that multiple related incidents
can be identified, other employees can be alerted to potential threats,
and appropriate investigations can be performed. Such incidents might
include multiple attacks by a common hacker or repeated infections with
the same computer virus.
Without prompt and appropriate responses to security incidents,
violations could continue to occur and cause damage to an agency�s
resources indefinitely. Further, violators will not be deterred from
continuing inappropriate access activity, which could cause
embarrassment to the entity and result in disclosure of confidential
information and financial losses.
An entity should have documented procedures in place for responding to
security violations. These should include procedures and criteria for:
* incident containment, eradication, and recovery,
* documenting offenses,
* determining the seriousness of violations,
* reporting violations to higher levels of management,
* investigating violations,
* imposing disciplinary action for specific types of violations,
* notifying the resource owner of the violation,
* sharing incident and threat information with owners of connected
systems, and,
* reporting suspected criminal activity to law enforcement officials.
Further, access control policies and techniques should be modified when
violations, incidents, and related risk assessments indicate that such
changes are appropriate.
In addition, the frequency and magnitude of security violations and the
corrective actions that have been taken should periodically be
summarized and reported to senior management. Such a report can assist
management in its overall management of risk by identifying the most
attractive targets, trends in types of violations, cost of securing the
agency�s operations, and any need for additional controls.
Finally, since even the best incident response program may not catch
increasingly sophisticated system intrusions, critical system resources
should be periodically reviewed for integrity. For example, an
organization may employ integrity verification applications on the
information system to automatically look for evidence of information
tampering, errors, and omissions.
AC-5 Related NIST SP-800-53 Controls:
AC-13 Supervision and Review�Access Control;
AT-5 Contacts with Security Groups and Associations;
AU-2 Auditable Events;
AU-3 Content of Audit Records;
AU-4 Audit Storage Capacity;
AU-5 Response to Audit Processing Failures;
AU-6 Audit Monitoring, Analysis, and Reporting;
AU-7 Audit Reduction and Report Generation;
AU-8 Time Stamps;
AU-9 Protection of Audit Information;
AU-11 Audit Record Retention;
IR-1 Incident Response Policy and Procedures;
IR-2 Incident Response Training;
IR-3 Incident Response Testing and Exercises;
IR-4 Incident Handling;
IR-5 Incident Monitoring;
IR-6 Incident Reporting;
IR-7 Incident Response Assistance;
SC-5 Denial Of Service Protection;
SI-4 Information System Monitoring Tools and Techniques;
SI-6 Security Functionality Verification.
Control Techniques and Suggested Audit Procedures for Critical Element
AC-5:
Table 20. Control Techniques and Suggested Audit Procedures for
Critical Element AC-5: Implement an effective audit and monitoring
capability:
Control activity:
AC-5.1. An effective incident response program is documented and
approved.
Control techniques:
AC-5.1.1. An effective incident-response program has been implemented
and include:
* documented policies, procedures, and plans;
* documented testing of the incident response plan and follow-up on
findings;
* a means of prompt centralized reporting;
* active monitoring of alerts/advisories;
* response team members with the necessary knowledge, skills, and
abilities;
* training on roles and responsibilities and periodic refresher
training;
* links to other relevant groups;
* protection against denial-of-service attacks (see [hyperlink,
http://icat.nist.gov]);
* appropriate incident-response assistance; and;
* consideration of computer forensics.
Audit procedures:
Interview security manager, response team members, and system users;
review documentation supporting incident handling activities; compare
practices to policies, procedures, and related guidance such as NIST SP
800-61 that provides guidance on incident-handling and reporting.
Determine qualifications of response team members; review training
records; identify training in incident response roles and
responsibilities. Identify the extent to which computer forensics is
used and compare to applicable guidelines and industry best practices.
Control activity:
AC-5.2. Incidents are effectively identified and logged.
Control techniques:
AC-5.2.1. An effective intrusion detection system has been implemented,
including appropriate placement of intrusion-detection sensors and
incident thresholds.
Audit procedures:
Obtain the design and justification for the intrusion detection system;
determine if the placement of sensors and incident thresholds is
appropriate based on cost and risk.
Control activity:
AC-5.2. Incidents are effectively identified and logged.
Control techniques:
AC-5.2.2. An effective process has been established based on a risk
assessment, to identify auditable events that will be logged.
Audit procedures:
Interview the security manager to determine the process for determining
what actions are logged. Determine if security event correlation tools
are used to identify anomalous network activity.
Control activity:
AC-5.2. Incidents are effectively identified and logged.
Control techniques:
AC-5.2.3. All auditable events, including access to and modifications
of sensitive or critical system resources, are logged.
Audit procedures:
Review security software settings to identify types of activity logged;
compare to NIST guidance on auditable events.
Control activity:
AC-5.2. Incidents are effectively identified and logged.
Control techniques:
AC-5.2.4. Audit records contain appropriate information for effective
review including sufficient information to establish what events
occurred, when the events occurred (for example, time stamps), the
source of the events, and the outcome of the events.
Audit procedures:
Determine if audit records/logs are reviewed and whether they contain
appropriate information; see appropriate NIST guidance.
Control activity:
AC-5.2. Incidents are effectively identified and logged.
Control techniques:
AC-5.2.5. Audit record storage capacity is adequate and configured to
prevent such capacity from being exceeded. In the event of an audit
failure or audit storage capacity being reached, the information system
alerts officials and appropriate action is taken.
Audit procedures:
Determine the retention period for audit records and logs and whether
it complies with applicable guidance. Determine if audit capacity is
sufficient and what happens should it be exceeded.
Control activity:
AC-5.2. Incidents are effectively identified and logged.
Control techniques:
AC-5.2.6. Audit records and tools are protected from unauthorized
access, modification, and deletion. Audit records are effectively
reviewed for unusual or suspicious activity or violations.
Audit procedures:
Determine how access to audit records/logs is controlled; review logs
for suspicious activity and evidence of entity follow-up and
appropriate corrective action.
Control activity:
AC-5.2. Incidents are effectively identified and logged.
Control techniques:
AC-5.2.7. Audit records are retained long enough to provide support for
after-the-fact investigations of security incidents and to meet
regulatory and organizational information retention requirements.
Audit procedures:
Determine if audit record retention (for example, logs etc.) meet legal
requirements and entity policy for computer forensics.
Control activity:
AC-5.3. Incidents are properly analyzed and appropriate actions taken.
Control techniques:
AC-5.3.1. Security violations and activities, including failed logon
attempts, other failed access attempts, and sensitive activity, are
reported and investigated.
Audit procedures:
Review pertinent policies and procedures; review security violation
reports; examine documentation showing reviews of questionable
activities.
Control activity:
AC-5.3. Incidents are properly analyzed and appropriate actions taken.
Control techniques:
AC-5.3.2. Security managers investigate security violations and
suspicious activities and report results to appropriate supervisory and
management personnel.
Audit procedures:
Test a selection of security violations to verify that follow-up
investigations were performed and reported to appropriate supervisory
and management personnel.
Control activity:
AC-5.3. Incidents are properly analyzed and appropriate actions taken.
Control techniques:
AC-5.3.3. Appropriate disciplinary actions are taken.
Audit procedures:
For the sample in AC-5.3.2, determine what action was taken against the
perpetrator.
Control activity:
AC-5.3. Incidents are properly analyzed and appropriate actions taken.
Control techniques:
AC-5.3.4. Violations and incidents are analyzed, summarized, and
reported to senior management and appropriate government authorities.
Interview senior management and personnel responsible for summarizing
violations; review any supporting documentation.
Audit procedures:
Determine if automated tools are used to analyze network activity and
whether it complies with security policy.
Control activity:
AC-5.3. Incidents are properly analyzed and appropriate actions taken.
Control techniques:
AC-5.3.5. Alerts and advisories are issued to personnel when
appropriate.
Audit procedures:
Identify recent alerts and advisories and determine if they are up-to-
date; interview entity personnel to determine what actions were taken.
Control activity:
AC-5.3. Incidents are properly analyzed and appropriate actions taken.
Control techniques:
AC-5.3.6 Incident and threat information is shared with owners of
connected systems.
Audit procedures:
Determine if incident and threat data are shared with owners of
connected systems; follow up with owners of connected systems to see if
they received this information in a timely manner.
Control activity:
AC-5.3. Incidents are properly analyzed and appropriate actions taken.
Control techniques:
AC-5.3.7. Access control policies and techniques are modified when
violations, incidents, and related risk assessments indicate that such
changes are appropriate.
Audit procedures:
Review policies and procedures and interview appropriate personnel;
review any supporting documentation.
Control activity:
AC-5.3. Incidents are properly analyzed and appropriate actions taken.
Control techniques:
AC-5.3.8. Critical system resources are periodically reviewed for
integrity.
Audit procedures:
Determine how frequently alterations to critical system files are
monitored (for example, integrity checkers, etc.).
Control activity:
AC-5.3. Incidents are properly analyzed and appropriate actions taken.
Control techniques:
AC-5.3.9. Appropriate processes are applied to gather forensic evidence
in support of investigations.
Audit procedures:
Review entity processes to gather forensic information and determine
whether they are adequate. Discuss with appropriate entity management.
Source: GAO.
[End of table]
Critical Element AC-6. Establish adequate physical security controls:
Adequate physical security controls should be established that are
commensurate with the risks of physical damage or access. In evaluating
the effectiveness of physical security controls, the auditor should
consider the effectiveness of the agency�s policies and practices
pertaining to both the overall facility and areas housing sensitive
information technology components. Consequently, an entity should
implement physical security controls in the following areas:
* security planning and management (security management),
* securing the perimeter of the facility (perimeter security),
* controlling access into a facility (entry security),
* controlling access within a facility (interior security), and,
* protection from emerging physical security threats (emerging
threats).
Physical security controls restrict physical access to computer
resources and protect them from intentional or unintentional loss or
impairment. Computer resources to be protected include:
* primary computer facilities,
* cooling system facilities,
* network devices such as routers and firewalls,
* terminals used to access a computer,
* microcomputers and mobile or portable systems,
* devices that display or output information,
* access to network connectivity, such as through �live� network jacks,
* computer file storage areas, and ? telecommunications equipment and
transmission lines.
In June 1995, the Department of Justice (DOJ) published minimum-
security standards for the protection of federal facilities. It
identified and evaluated the various types of security measures that
could be used to counter potential vulnerabilities. The standards cover
perimeter security, entry security, interior security, and security
planning. Because of the considerable differences among facilities and
their security needs, physical holdings are divided into five security
levels to determine which minimum standards are appropriate for which
security levels.[Footnote 71] For federal agency facilities,
appropriate criteria for physical safeguards in place for the overall
facility are Justice standards unless the facility has adopted
different standards. To illustrate, information technology resources
may be housed in a facility that has been designated a national
critical asset in accordance with Homeland Security Presidential
Directive 7[Footnote 72] and therefore require physical security
measures above those required by DOJ standards. For non-federal
entities, appropriate criteria are equivalent guidance or the federal
standards.
Physical controls also include environmental controls, such as smoke
detectors, fire alarms, extinguishers, and uninterruptible power
supplies (see section 3.5, service continuity).
In an IS controls audit being performed as part of a financial audit or
data reliability assessment, the auditor should tailor the
identification of control techniques and audit procedures related to
the entity�s physical security management program to the extent
necessary to achieve the audit objectives, considering the IS controls
identified by the auditor as significant to the audit objectives (e.g.,
internal control over financial reporting). Generally, this would
include consideration of the overall design of the entity�s physical
security program at relevant facilities.
AC-6.1. Establish a physical security management program based on risk:
Risk management is the foundation of an effective physical security
program. The approach to good security is fundamentally similar,
regardless of the assets being protected�information systems,
buildings, or critical infrastructure. Risk management principles for
an effective security program are discussed in section 3.1. In
addition, the testimonies Technologies to Secure Federal Buildings (GAO-
02-687T) and Key Elements of a Risk Management Approach (GAO-02-150T)
elaborate on specific risk management steps that may be applied to the
protection of any critical asset.
The effectiveness of physical security controls depends on the
effectiveness of the agency�s policies and practices pertaining to the
overall facility and to areas housing sensitive information technology
components, including:
* granting and discontinuing access authorizations,
* controlling badges, ID cards, smartcards, passkeys, and other entry
devices,
* controlling entry during and after normal business hours,
* controlling the entry and removal of computer resources (for example,
equipment and storage media) from the facility,
* managing emergencies,
* controlling reentry after emergencies,
* establishing compensatory controls when restricting physical access
is not feasible, as is often the case with telecommunications lines,
and;
* storing computer assets such as equipment and sensitive documents.
In some instances an entity may not be able to fully control their
physical security posture. For example, leased space in a building
managed by another organization. In this case, the entity should
consider compensating controls and ensure that contingency planning
adequately considers their lack of control over physical security.
As with any type of business activity, physical security should be
monitored to ensure that controls are accomplishing their intended
purpose. FISMA specifically requires that federal agencies periodically
test and evaluate information security controls and techniques to
ensure that they are effectively implemented.
Visitors should be controlled. On occasion, persons other than
regularly authorized personnel may be granted access to sensitive areas
or facilities, such as employees from another facility, maintenance
personnel, contractors, and the infrequent or unexpected visitor. None
of these visitors should be granted unrestricted access.[Footnote 73]
Controls should include:
* preplanned appointments,
* identification checks,
* controlling the reception area,
* logging in visitors,
* escorting visitors while in sensitive areas, and,
* periodically changing entry codes to prevent reentry by previous
visitors who might have knowledge of the code.
AC-6.2. Establish adequate perimeter security based on risk:
Perimeter security is the first line of defense against threats that
can cause catastrophic damages to facilities and internal computer
resources. Considerations for perimeter security include:
* controlling vehicle and pedestrian traffic around the facility,
* controlling employee and visitor parking,
* monitoring the perimeter with closed circuit TV (CCTV),
* providing emergency backup power supply, and,
* extending perimeter barriers to prevent unauthorized access and
reduce exposure to explosions.
Perimeter security includes protective controls such as fencing around
sensitive buildings, concrete and earthen and other barriers,
appropriate gates and locks, exterior lighting, guard posts, security
patrols, and detection and monitoring systems.
AC-6.3. Establish adequate security at entrances and exits based on
risk:
Access to facilities should be limited to personnel having a legitimate
need for access to perform their duties. Management should regularly
review the list of persons authorized to have physical access to
sensitive facilities, including contractors and other third parties. In
addition, procedures should be implemented to terminate access
privileges for terminated or separated employees or contractors.
Physical security controls at entrances and exits vary, but may
include:
* manual door or cipher key locks,
* magnetic door locks that require the use of electronic keycards,
* biometrics authentication,
* security guards,
* photo IDs,
* entry logs, and,
* electronic and visual surveillance systems.
Unissued keys or other entry devices should be secure. Issued keys or
other entry devices should be regularly inventoried.
AC-6.4. Establish adequate interior security based on risk:
The effectiveness of physical security controls over sensitive and
critical IT resources within a facility include consideration of
whether the entity has:
* identified all sensitive areas�such as individual rooms or equipment,
software and tape libraries, or telecommunication closets and
lines�that are susceptible to physical access, loss, or impairment;
* identified all physical access points and threats to the sensitive
areas; and;
* developed cost-effective security controls over all physical access
points and addressed all significant threats to sensitive areas.
In addition, the entity should have controls to prevent or detect
surreptitious entry into sensitive areas. For example, could
unauthorized persons gain entry by:
* observing lock combinations entered by authorized personnel?
* obtaining unsecured keycards?
* going over the top of a partition that stops at the underside of a
suspended ceiling when the partition serves as a wall for a sensitive
facility?
* cutting a hole in a plasterboard wall in a location hidden by
furniture?
Many of the control techniques for interior security are similar to
those for perimeter and entry security (for example, locks,
surveillance systems, as well as using and controlling badges, ID
cards, smartcards, passkey, and other entry devices). Additional
considerations include:
* logs and authorization for removal and return of tapes and other
storage media to the library,
* computer terminal locks,
* controlled access to powerful consoles in data centers, and,
* segregation of duties (discussed in section 3.4).
AC-6.5. Adequately protect against emerging threats based on risk:
In addition to traditional physical security considerations, it may be
important to protect building environments from new threats such as
airborne chemical, biological, and radiological (CBR) attacks. Such
protective measures may include the installation of early warning
sensors, the location and securing of air intakes, and plans and
procedures to mitigate the effect of a CBR release. The decisions
concerning which protective measures should be implemented for any
building should be based on several factors, including the perceived
risk associated with the building and its tenants, engineering and
architectural feasibility, and cost.
Appropriate audit procedures related to emerging threats include:
* Interview appropriate officials to identify the level of physical
security controls needed for the facility.
* Review the facility risk and independent assessments (for example,
internal audit, internal office of physical security, outside
consultants) to identify their assessment of risk and the adequacy of
controls in place.
* Observe and document the controls in place. Assess the organization�s
preparations based on what the organization has stated it needs based
on risk, including an evacuation plan for a possible CBR attack.
* Identify any planned projects to enhance physical security controls
in this area through discussions with physical security and building
management/operations staff.
Control Techniques and Suggested Audit Procedures for Critical Element
AC-6:
AC-6 Related NIST SP-800-53 Controls:
PE-2 Physical Access Authorizations;
PE-3 Physical Access Control;
PE-4 Access Control for Transmission Medium;
PE-5 Access Control Policy for Display Medium;
PE-6 Monitoring Physical Access;
PE-7 Visitor Control;
PE-8 Access Records.
Table 21. Control Techniques and Suggested Audit Procedures for
Critical Element AC-6: Establish adequate physical security controls:
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Audit procedures:
Coordinate with sections SM-2 (assess and validate risks), SM-3
(policies and procedures), SD-1 (segregation of duties), and CP-2
(environmental controls).
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Control techniques:
AC-6.1.1. Use a risk management approach to identify the level of
physical security needed for the facility and implement measures
commensurate with the risks of physical damage or access.
Audit procedures:
Interview entity officials to discuss how their physical security
program is organized and whether they use a risk management approach.
Obtain and review any facility risk assessments performed by the entity
or by independent entities.
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Control techniques:
AC-6.1.2. Facilities and areas housing sensitive and critical resources
have been identified. The following generally constitute sensitive
areas: computer rooms, tape libraries, telecommunication closets,
mechanical/electrical rooms, cooling facilities and data transmission
and power lines.
Audit procedures:
Review diagram of physical layout of the computer network,
telecommunications, and cooling system facilities (for example, HVAC);
Inspect these areas for physical access control weaknesses.
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Control techniques:
AC-6.1.3. All significant threats to the physical well-being of these
resources have been identified and related risks determined. Interview
agency officials.
Audit procedures:
Review risk analysis to ensure that it includes physical threats to
employees and assets. Review any recent audit reports or other
evaluations of the facility�s physical security.
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Control techniques:
AC-6.1.4. Establish law enforcement security liaisons that facilitate
the accurate flow of timely security information between appropriate
government agencies, provide procedures for the timely receipt and
dissemination of threat information, and implement a standardized
security/threat classifications and descriptions (for example, alert
levels).
Audit procedures:
Check if the organization has established law enforcement security
liaisons that facilitate the accurate flow of timely security
information between appropriate government agencies. Review how the
organization receives and disseminates security alerts. [Identify
governmental agencies involved in the flow of security information and
interview appropriate officials. Review procedures and nomenclature for
threat information.]
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Control techniques:
AC-6.1.5. Conduct annual employee physical security awareness training.
Coordinate this step with SM-4.
Audit procedures:
Review information (for example, individual training records, training
program content) on security awareness training and its frequency.
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Control techniques:
AC-6.1.6. Security control procedures (for example, trusted
vendors/suppliers, background checks, etc.) are established for non-
employees (contractors, custodial personnel).
Audit procedures:
Review security control procedures for scope and adequacy.
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Control techniques:
AC-6.1.7. Periodic monitoring and independent evaluations of the
physical security program are conducted. Physical security incidents
are effectively monitored and appropriate countermeasures are
implemented.
Audit procedures:
Check if the agency evaluates its physical security program and
controls. Obtain and review the agency�s most recent self assessments
and compliance review report. Determine if security incidents are
recorded, effectively analyzed, and result in appropriate
countermeasures. Coordinate with SM-5: Monitor the effectiveness of the
security program, and AC-5: Implement an effective audit and monitoring
capability.
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Control techniques:
AC-6.1.8. When possible, do not co-locate high risk operations with non-
essential support organizations (for example, cafeteria, day care,
banks, news media). If not possible, place appropriate security between
such support organizations and critical facilities.
Audit procedures:
Identify co-located operations and their respective risk levels.
Determine if the agency co-locates high risk operations with support
operations and assess the security impact.
Control activity:
AC-6.1. Establish an effective physical security management program
based on risk.
Control techniques:
AC-6.1.9. Visitors, contractors, and maintenance personnel are
authenticated through the use of preplanned appointments and
identification checks.
Audit procedures:
Review appointment and verification procedures for visitors,
contractors, and maintenance personnel. Compare actual practices to
procedures.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.2.1. Control/restrict vehicle and pedestrian traffic around the
facility based on the facility�s risk level. Specific measures include
fences, gates, locks, guard posts, perimeter patrols and inspections.
Audit procedures:
Determine if vehicle and pedestrian traffic around the facility is
adequately controlled for the risk level. Inspect the perimeter for
physical security and access control weaknesses. Assess the
effectiveness of perimeter guard procedures and practices for
controlling access to facility grounds.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.2.2. Control employee and visitor parking. For example, restrict
access to facility parking and parking adjacent to the facility
(including leases), use ID systems and procedures for authorized
parking (for example, placard, decal, card key), have signs and
arrangements for towing of unauthorized vehicles and adequate lighting
for parking areas.
Audit procedures:
Observe parking area and related controls. Check if identification
systems and procedures for authorized parking are in place. Determine
what is done about unauthorized vehicles (e.g. towing).
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.2.3. Monitor the perimeter with closed circuit television (CCTV)
including cameras with time lapse video recording and warning signs
advising of 24 hour video surveillance.
Audit procedures:
Inspect the facility surveillance camera system to assess its capacity
and ability to assist in protecting the facility�s perimeter.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.2.4. Lighting is adequate for effective surveillance and
evacuation operations. Emergency power backup exists for lighting (as
well as for alarm and monitoring systems).
Audit procedures:
Observe perimeter and exterior building lighting to determine its
adequacy. Also, determine if emergency power is available for security
systems. Request test results.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.2.5. Extend perimeter barriers (for example, concrete, steel) and
parking barriers, as needed, to prevent unauthorized access and reduce
exposure to explosions.
Audit procedures:
Determine if perimeter barriers are used and extended if appropriate.
AC-6.3. Establish adequate security at entrances and exits based on
risk.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.3.1. All employee access is authorized and credentials (for
example, badges, identification cards, smart cards) are issued to allow
access.
Audit procedures:
Observe and document all access control devices used to secure the
facility.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.3.2. Access is limited to those individuals who routinely need
access through the use of guards, identification badges, or entry
devices such as key cards.
Audit procedures:
Observe entries to and exits from facilities during and after normal
business hours. Obtain a list of employees and contractors with badged
access and check the justification for such access. Check whether
terminated employees/contractors have turned in their badge.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.3.3. Management conducts regular reviews of individuals with
physical access to sensitive facilities to ensure such access is
appropriate.
Audit procedures:
Review procedures used by management to ensure that individuals
accessing sensitive facilities are adequately restricted. Evaluate
support for physical access authorizations and determine
appropriateness.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.3.4. Intrusion detection systems with central monitoring
capability are used to control access outside of normal working hours
(for example, nights and weekends).
Audit procedures:
Determine if an intrusion detection system is used and test its use for
appropriate exterior and interior apertures.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.3.5. Visitor access logs are maintained and reviewed.
Audit procedures:
Compare entries in the log to a list of personnel authorized access.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.3.6. X-ray and magnetometer equipment is used to screen people,
possessions, and packages.
Audit procedures:
Observe how this equipment is used and test its effectiveness.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.3.7. The entity controls information system-related items (i.e.,
hardware, firmware, software) entering and exiting the facility and
maintains appropriate records of those items.
Audit procedures:
Review procedures and interview officials. Attempt to enter and exit
the facility with information systems items at various entry points and
times.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.3.8. Entry and exit points are monitored by using CCTV capability.
Also, high security locks and alarm systems are required for all doors
that are not guarded.
Audit procedures:
Observe use of these devices and test as appropriate. Inspect the
building(s) for physical access control weaknesses.
Control activity:
AC-6.2. Establish adequate perimeter security based on risk.
Control techniques:
AC-6.3.9. Emergency exit and re-entry procedures ensure that only
authorized personnel are allowed to reenter the facility after fire
drills, etc.
Audit procedures:
Review written emergency procedures. Examine documentation supporting
prior fire drills. Observe a fire drill.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.1. An ID badge should generally be displayed at all times. [All
individuals must display an ID at all times.]
Audit procedures:
Observe use of employee and visitor IDs. See what happens if you do not
display your own ID.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.2. Visitors such as vendors, contractors, and service personnel
who need access to sensitive areas are prescreened, formally signed in,
badged and escorted. Review visitor entry logs.
Audit procedures:
Observe entries to and exits from sensitive areas during and after
normal business hours. Interview guards at facility entry.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.3. Sensitive information technology and infrastructure resources
are adequately secured (for example, using keys, alarm systems,
security software and other access control devices), including:
* the badging system,
* computer room, master consoles, and tape libraries,
* display and output devices,
* data transmission lines,
* power equipment and power cabling,
* mobile or portable systems, and,
* utility and mechanical areas (HVAC, elevator, water).
Audit procedures:
Interview officials. Walk through facilities and observe potential
vulnerabilities and security controls [measures] used to protect
sensitive information technology resources. Observe entries to and
exits from sensitive areas during and after normal business hours.
Review security software features and settings. Evaluate the badging
system: who has access to the badging system and how it is protected;
how is physical control is maintained over unissued and visitor badges.
Test the controls.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.4. Management conducts regular reviews of individuals with
physical access to sensitive areas to ensure such access is
appropriate.
Audit procedures:
Review procedures used by management to ensure that individuals
accessing sensitive areas are adequately restricted. Determine if there
is a periodic (e.g. annual) auditing and reconciliation of ID cards.
Evaluate support for physical access authorizations and determine
appropriateness.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.5. As appropriate, physical access logs to sensitive areas are
maintained and routinely reviewed.
Audit procedures:
Compare entries in the logs to a list of personnel authorized access.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.6. Unissued keys, badges, or other entry devices are secured.
Issued keys or other entry devices are regularly inventoried.
Audit procedures:
Observe practices for safeguarding keys, badges, and other devices.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.7. Entry codes are changed periodically.
Audit procedures:
Review documentation of entry code changes.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.8. All deposits and withdrawals of storage media from the
library are authorized and logged.
Audit procedures:
Review procedures for the removal and return of storage media to and
from the library. Select from the log some returns and withdrawals,
verify the physical existence of the tape or other media, and determine
whether proper authorization was obtained for the movement.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.9. Documents/equipment are appropriately stored and are subject
to maintenance and accountability procedures.
Audit procedures:
Examine and verify maintenance and accountability procedures for
storage of documents and equipment.
Control activity:
AC-6.4. Establish adequate interior security based on risk.
Control techniques:
AC-6.4.10. Critical systems have emergency power supplies (for example,
all alarm systems, monitoring devices, entry control systems, exit
lighting, communication systems).
Audit procedures:
Verify that critical systems, (e.g., alarm systems, monitoring devices,
entry control systems, exit lighting, and communication systems) have
emergency power supplies. Identify back up systems and procedures and
determine the frequency of testing. Review testing results.
Control activity:
AC-6.5. Adequately protect against emerging threats, based on risk.
Control techniques:
AC-6.5.1. Appropriate plans have been developed and controls
implemented based on a risk assessment such as a shelter in place plan
and/or evacuation plan for a potential CBR attack. [A plan is in place
and tested to respond to emerging threats such as a CBR attack (e.g. an
appropriate shelter in place and/or evacuation plan.)
Audit procedures:
Interview officials, review planning documents, and related test
results. Observe and document the controls in place to mitigate
emerging threats.
Control activity:
AC-6.5. Adequately protect against emerging threats, based on risk.
Control techniques:
AC-6.5.2. Outdoor areas such as air intakes, HVAC return air grilles,
and roofs have been secured by restricting public access and relocating
or protecting critical entry points (for example, air intake vents,
protective grills, etc.)
Audit procedures:
Observe location of these devices and identify security measures that
have been implemented.
Control activity:
AC-6.5. Adequately protect against emerging threats, based on risk.
Control techniques:
AC-6.5.3. All outdoor air intakes are monitored by CCTV, security
lighting, and/or intrusion detection sensors.
Audit procedures:
Verify the existence of these controls.
Control activity:
AC-6.5. Adequately protect against emerging threats, based on risk.
Control techniques:
AC-6.5.4. The ventilation and air filtration system has been evaluated
for vulnerabilities to CBR agents and remedial action taken based on
cost and risks.
Audit procedures:
Interview officials and review the results of any evaluations.
Source: GAO.
[End of table]
3.3. Configuration Management (CM):
Configuration management (CM) involves the identification and
management of security features for all hardware, software, and
firmware components of an information system at a given point and
systematically controls changes to that configuration during the
system�s life cycle. At an entitywide level, management develops
security policies that establish the agency�s configuration management
process and may establish the configuration settings for the
organization. Policy enforcement applications can be used to help
administrators define and perform centralized monitoring and
enforcement of an agency�s security policies. These tools examine
desktop and server configurations that define authorized access to
specified devices and they compare these settings against a baseline
policy. At a system level, network management provides system
administrators with the ability to control and monitor a computer
network from a central location. Network management systems obtain
status data from network components, enable network managers to make
configuration changes, and alert them of problems. For each critical
control point, at each system sublevel (for example, network, operating
systems, and infrastructure applications), the entity should have
configuration management controls to ensure that only authorized
changes are made to such critical components. At a business process
application level, all applications and changes to those applications
should go through a formal, documented systems development process that
identifies all changes to the baseline configuration. Also, procedures
should ensure that no unauthorized software is installed.
In some instances, the entity may not have an effective entitywide
configuration management process, but may nonetheless have
configuration management controls at the systems and business process
application level. Therefore, evaluation of configuration controls at
all levels is important to determine whether they are effective.
FISMA requires each federal agency to determine minimally acceptable
system configuration requirements and ensure compliance with them.
Systems with secure configurations have less vulnerability and are
better able to thwart network attacks. In response to both FISMA and
the Cyber Security Research and Development Act, NIST developed a
central repository for information technology security configuration
checklists:[hyperlink, http://checklists.nist.gov]. Typically,
checklists are created by information technology vendors for their own
products; however, checklists are also created by other entities such
as consortia, academia, and government agencies. Security configuration
checklists are a series of instructions for configuring a product to a
particular operational environment. Some examples of the types of
devices and software for which security checklists are intended are as
follows:
* general purpose operating systems;
* common desktop applications such as e-mail clients, Web browsers,
word processing, personal firewalls, and antivirus software;
* infrastructure devices such as routers, firewalls, virtual private
network (VPN) gateways, intrusion detection systems (IDS), wireless
access points (WAP), and telecom systems;
* application servers such as domain name system (DNS) servers, dynamic
host configuration protocol (DHCP) servers, Web servers, simple mail
transfer protocol (SMTP) servers, file transfer protocol (FTP) servers,
and database servers;
* other network devices such as mobile devices, scanners, printers,
copiers, and fax appliances.
Industry best practices, NIST, and DOD guidance[Footnote 74] all
recognize the importance of configuration management when developing
and maintaining a system or network. Through configuration management,
the composition of a system is formally defined and tracked to ensure
that an unauthorized change is not introduced. Changes to an
information system can have a significant impact on the security of the
system. Documenting information system changes and assessing the
potential impact on the security of the system on an ongoing basis is
an essential aspect of maintaining the security posture. An effective
entity configuration management and control policy and associated
procedures are essential to ensuring adequate consideration of the
potential security impact of specific changes to an information system.
Configuration management and control procedures are critical to
establishing an initial baseline of hardware, software, and firmware
components for the entity and subsequently controlling and maintaining
an accurate inventory of any changes to the system.
An effective configuration management process consists of four primary
concepts, each of which should be described in a configuration
management plan and implemented according to the plan. The four are:
* configuration identification: procedures for identifying,
documenting, and assigning unique identifiers (for example, serial
number and name) to a system�s hardware and software component parts
and subparts, generally referred to as configuration items;
* configuration control: procedures for evaluating and deciding whether
to approve changes to a system�s baseline configuration; decision
makers such as a configuration control board evaluate proposed changes
on the basis of costs, benefits, and risks, and decide whether to
permit a change;
* configuration status accounting: procedures for documenting and
reporting on the status of configuration items as a system evolves.
Documentation, such as historical change lists and original designs or
drawings, are generated and kept in a library, thereby allowing
entities to continuously know the state of a system�s configuration and
be in a position to make informed decisions about changing the
configuration;
* configuration auditing: procedures for determining alignment between
the actual system and the documentation describing it, thereby ensuring
that the documentation used to support decision making is complete and
correct. Configuration audits are performed when a significant system
change is introduced and help to ensure that only authorized changes
are being made and that systems are operating securely and as intended.
Establishing controls over the modification of information system
components and related documentation helps to ensure that only
authorized systems and related program modifications are implemented.
This is accomplished by instituting policies, procedures, and
techniques that help make sure all hardware, software, and firmware
programs and program modifications are properly authorized, tested, and
approved, and that access to and distribution of computer assets is
carefully controlled. Without proper controls, there is a risk that
security features could be inadvertently or deliberately omitted or
turned off or that processing irregularities or malicious code could be
introduced. For example,
* a knowledgeable programmer could modify program code to provide a
means of bypassing controls to gain access to sensitive data;
* the wrong version of a program could be implemented, thereby
perpetuating outdated or erroneous processing that is assumed to have
been updated; or;
* a virus could be introduced, inadvertently or on purpose, that
disrupts processing.
Effective configuration management prevents unauthorized changes to
information system resources (for example, software programs and
hardware configurations) and provides reasonable assurance that systems
are configured and operating securely and as intended.
The absence of effective system-level configuration management is a
serious risk that jeopardizes an agency�s ability to support current
and potential requirements. Without effective configuration management,
users do not have adequate assurance that the system and network will
perform as intended and to the extent needed to support their missions.
Assessing controls over configuration management involves evaluating
the agency�s success in performing each of the critical elements listed
in table 22. Also, NIST SP 800-100 provides guidance in related
configuration management programmatic areas of capital planning and
investment control, and security services and product acquisition. This
publication discusses practices designed to help security managers
identify funding needs to secure systems and provide strategies for
obtaining the necessary funding. In addition, it provides guidance to
entities in applying risk management principles to assist in the
identification and mitigation of risks associated with security
services acquisitions.
Table 22. Critical Elements for Configuration Management:
Number: CM-1.
Description: Develop and document CM policies, plans, and procedures ;
Number: CM-2.
Description: Maintain current configuration identification information;
Number: CM-3.
Description: Properly authorize, test, approve, and track all
configuration changes;
Number: CM-4.
Description: Routinely monitor the configuration;
CM-5.
Description: Update software on a timely basis to protect against known
vulnerabilities;
Number: CM-6.
Description: Appropriately document and approve emergency changes to
the configuration.
Source: GAO.
[End of table]
Critical Element CM-1. Develop and document CM policies, plans, and
procedures:
Configuration management policies, plans, and procedures should be
developed, documented, and implemented at the entitywide, system, and
application levels to ensure an effective configuration management
process. Such procedures should cover employee roles and
responsibilities, change control and system documentation requirements,
establishment of a decision-making structure, and configuration
management training. CM should be a key part of an agency�s Systems
Development Life Cycle (SDLC) methodology.[Footnote 75]
An effective entitywide SDLC methodology details the procedures that
are to be followed when systems and applications are being designed and
developed, as well as when they are subsequently modified. The SDLC
should provide a structured approach for identifying and documenting
needed changes to computerized operations; assessing the costs and
benefits of various options, including the feasibility of using off-the-
shelf software; and designing, developing, testing, and approving new
systems and system modifications. It is especially important that, for
new systems being developed or for major enhancements to existing
systems, SDLC require approving design features at key points during
the design and development process. For the methodology to be properly
applied, it should be sufficiently documented to provide staff with
clear and consistent guidance. Also, personnel involved in designing,
developing, and implementing new systems and system modifications
should be appropriately trained. This includes program staff who
initiate requests for modifications and staff involved in designing,
programming, testing, and approving changes. NIST SP 800-64, dated
October 2003, identifies security considerations in the information
system development life cycle. In addition, NIST SP 800-27 provides
guidance on engineering principles for designing security into
information systems.
Configuration management policies and procedures should describe the
configuration management process and address purpose, scope, roles,
responsibilities, compliance, and implementation of security controls.
Security controls include the following.
* A baseline configuration of the information system and an inventory
of the system�s constituent components.
* A process to document and control changes to the system.
* Monitoring system changes and analysis of their impact to determine
the effect of the changes.
* Access restrictions over changes to the system and auditing of the
enforcement actions.
* Configuring the security settings of information technology products
to the most restrictive mode consistent with operational requirements.
* Configuring the information system to provide only essential
capabilities and specifically prohibiting or restricting the use of
unnecessary or dangerous functions, ports, protocols, and services.
Good configuration management provides strict control over the
implementation of system changes and thus minimizes corruption to
information systems.
Also, CM policies should address the introduction of software developed
outside of the entity�s normal software development process, including
commercial or other software acquired by individual users.
Configuration management plans should address configuration management
in terms of the following:[Footnote 76]
* responsibilities and authorities for accomplishing the planned
activities (who);
* activities to be performed (what);
* required coordination of configuration management activities with
other activities (when);
* tools and physical and human resources required for the execution of
the plan as well as how the plan will be kept current (how).
The CM plan should describe the allocation of responsibilities and
authorities for CM activities to entities and individuals within the
project structure. Organizational units may consist of a vendor and
customer, a prime contractor and subcontractors, or different groups
within one entity. The name of the organizational unit or job title to
perform this activity is provided for each activity listed within CM
activities. A matrix that relates these entities to CM functions,
activities, and tasks is useful for documenting CM activities. CM
activities identify all functions and tasks required to mange the
configuration as specified in the scope of the CM plan. CM activities
are traditionally grouped into four functions: configuration
identification, configuration control, configuration status accounting,
and configuration audits and reviews.
Configuration management procedures should describe the configuration
management system used to maintain and change controlled work products.
A configuration management system includes the storage media, the
procedures, and the tools for accessing the configuration system. The
procedures should describe how configuration items are stored and
retrieved; shared between control levels; recovered; protected by
access controls; and stored, updated, and retrieved. Configuration
management plans should be integrated at all levels.
CM-1 Related NIST SP-800-53 Controls:
CM-1 Configuration Management Policy and Procedures.
Control Techniques and Suggested Audit Procedures for Critical Element
CM-1:
Table 23. Control Techniques and Suggested Audit Procedures for
Critical Element CM-1: Develop and document CM policies, plans, and
procedures:
Control activities:
CM-1.1. CM policies, plans and procedures have been developed,
documented, and implemented.
Control techniques:
CM-1.1.1. An effective configuration management process is documented
and implemented, including:
* a CM plan that identifies roles, responsibilities, procedures, and
documentation requirements;
* guidance that is appropriate for personnel with varying levels of
skill and experience;
* trained personnel who are familiar with the organization�s
configuration management process;
* permitting only essential capabilities and restricting the use of
dangerous functions, ports, protocols, and services;
* regular review and approval of configuration changes by management
(for example, Configuration Control Board);
* a formal SDLC methodology that includes system-level security
engineering principles to be considered in the design, development, and
operation of an information system.
* appropriate systems documentation.
Audit procedures:
Review CM policies, plans, and procedures to identify roles,
responsibilities, procedures, and documentation requirements. Determine
if a CCB exists and is operating effectively. Interview staff and
review training records. Interview hardware and software managers to
identify the currency and completeness of CM policies, plans,
procedures, and documentation. Review CM documentation and test whether
recent changes are incorporated. Review the SDLC methodology and ensure
that security is adequately considered throughout the life cycle.
Review a selection of system documentation to verify that the SDLC
methodology was followed and complies with appropriate guidance, such
as NIST SP 800-64 and SP 800-27.
Source: GAO.
[End of table]
Critical Element CM-2. Maintain current configuration identification
information:
Configuration identification activities involve identifying, naming,
and describing the physical and functional characteristics of a
controlled item (for example, specifications, design, IP address, code,
data element, architectural artifacts, and documents). The CM plan
should describe how each configuration item and its versions are
uniquely named. It should also describe the activities performed to
define, track, store, manage, and retrieve configuration items.
Configuration items should be associated with development and
production baselines.
The entity should maintain current configuration information in a
formal configuration baseline that contains the configuration
information formally designated at a specific time during a product�s
or product component�s life. Configuration baselines, plus approved
changes from those baselines, constitute the current configuration
information. There should be a current and comprehensive baseline
inventory of hardware, software, and firmware, and it should be
routinely validated for accuracy. Backup copies of the inventory should
be maintained and adequately protected. There should also be
information system diagrams and documentation on the set up of routers,
switches, guards, firewalls, and any other devices facilitating
connections to other systems. FISMA requires federal agency compliance
with system configuration guidelines, as determined by the agency. In
addition, OMB Memorandum M-07-11 [Footnote 77] requires agencies that
upgrade to the Microsoft Vista� operating system to adopt the security
configurations developed by the National Institute of Standards and
Technology (NIST), the Department of Defense (DoD) and the Department
of Homeland Security (DHS).
CM-2 Related NIST SP-800-53 Controls:
CM-2 Baseline Configuration;
CM-6 Configuration Settings;
CM-8 Information System Component Inventory;
SA-5 Information System Documentation.
Control Techniques and Suggested Audit Procedures for Critical Element
CM-2:
Table 24. Control Techniques and Suggested Audit Procedures for
Critical Element CM-2: Maintain current configuration identification
information:
Control activities:
CM-2.1. Current configuration identification information is maintained.
Control techniques:
CM-2.1.1. A current and comprehensive baseline inventory of hardware,
software, and firmware is documented, backed up, and protected.
Information system documentation describes security controls in
sufficient detail to permit analysis and testing of controls.
Audit procedures:
Request an inventory of all computer assets and determine if the
inventory is accurate, complete, and whether duplicate copies are
adequately protected. Sample items in the inventory and trace to the
asset and verify that the configuration (model, settings, etc.) is
accurate. Sample assets at the entity and verify that they are
accurately recorded in the inventory.
Control activities:
CM-2.1. Current configuration identification information is maintained.
Control techniques:
CM-2.1.2. Configuration settings optimize the system�s security
features.
Audit procedures:
Determine if key component security settings conform with NIST SP 800-
70 and vendor recommendations.
Source: GAO.
[End of table]
Critical Element CM-3. Properly authorize, test, approve, track, and
control all configuration changes:
An entity should properly control all configuration changes; not only
changes made by internal developers but also changes made by external
developers or contractors (see SM-7 for activities performed by
external third parties). This includes a wide range of activities
starting with the establishment of a formal change management process.
Management should authorize and approve all configuration changes. Test
plan standards should be developed for all levels of testing and test
plans should be documented and approved by all responsible parties.
Testing should be comprehensive and appropriately consider security and
impacts on interfacing systems. An audit trail should be made to
clearly document and track the configuration changes.
Authorizations for system and application software modifications should
be documented and maintained. Policies and procedures should be in
place that detail who can authorize a modification and how these
authorizations are to be documented. Generally, the application users
have the primary responsibility for authorizing system changes;
however, users should be required to discuss their proposed changes
with systems developers to confirm that the change is feasible and cost
effective. For this reason, an entity may require a senior systems
developer to co-authorize a change. The use of standardized change
request forms helps ensure that requests are clearly communicated and
that approvals are documented. Authorization documentation should be
maintained for at least as long as a system is in operation in case
questions arise regarding why or when system modifications were made.
Authorization documents may be maintained in either paper or electronic
form as long as their integrity is protected.
Configuration control activities involve activities that request,
evaluate, approve, disapprove, or implement changes to baseline
configuration items. Changes encompass both error correction and
enhancements. The configuration management plan should identify each
level of decision making (for example, CCB[Footnote 78]) and its level
of authority for approving proposed system and application changes and
its management of development and production baselines.
The configuration status accounting process records and reports the
status of configuration items. The following are minimum data elements
to be tracked for a configuration item: (1) its initial approved
version, (2) the status of requested changes, and (3) the
implementation status of approved changes. The level of detail and
specific data required may vary according to the information needs of
the project and the customer.
A disciplined process for testing and approving new and modified
systems before their implementation is essential to make sure systems
hardware and related programs operate as intended and that no
unauthorized changes are introduced. Test plans should appropriately
consider security. The extent of testing varies depending on the type
of modification. For new systems being developed or major system
enhancements, testing will be extensive, generally progressing through
a series of test stages that include (1) testing individual program
modules (unit testing), (2) testing groups of modules that must work
together (integration testing), and (3) testing an entire system
(system testing). Minor modifications may require less extensive
testing; however, changes should still be carefully controlled and
approved since relatively minor program code changes, if performed
incorrectly, can have a significant impact on security and overall data
reliability.
Once a change has been authorized, it should be implemented, written
into the program code, and tested in a disciplined manner. Because
testing is an iterative process that is generally performed at several
levels, it is important that the entity adhere to a formal set of
configuration management procedures or standards for prioritizing,
scheduling, testing, and approving changes. These procedures should be
described in the agency�s configuration management plan and should
include requirements for:
* ranking and scheduling configuration changes so that authorized
change requests are not lost and are implemented efficiently and in
accordance with user needs;
* preparing detailed specifications for the configuration change, which
are approved by an individual responsible for supervising programming
activities to confirm that the specifications correspond to the user�s
authorized requirements;
* developing a detailed test plan for each modification that defines
the levels and types of tests to be performed;
* defining responsibilities for each person involved in testing and
approving software (for example, systems analysts, programmers, quality
assurance staff, auditors, library control personnel, and users�who
should participate in testing and approve test results before
implementation), including determining that testing is performed by
parties independent of development;
* developing related configuration changes to system documentation,
including hardware documentation, operating procedures, and user
procedures;
* supervisory review and documented approvals by appropriate personnel,
including programming supervisors, database administrators, and other
technical personnel before and after testing;
* maintaining controlled libraries of software in different stages of
development to ensure that programs being developed or tested are not
interchanged with each other or with production software;
* documenting configuration/software changes so that they can be traced
from authorization to the final approved code and facilitating �trace-
back� of code to design specifications and functional requirements by
system testers; and;
* obtaining final user acceptance only after testing is successfully
completed and reviewed by the user.
To ensure that approved software programs are protected from
unauthorized changes or impairment and that different versions are not
misidentified, copies should be maintained in carefully controlled
libraries. Further, adequately controlled software libraries help
ensure that there is (1) a copy of the official approved version of a
program available in case the integrity of an installed version is
called into question and (2) a permanent historical record of old
program versions.
Separate libraries should be established for programs being developed
or modified, programs being tested by users, and programs approved for
use (production programs). Access to these libraries should be limited
and movement of programs and data among them should be controlled.
Inadequately controlled software libraries increase the risk that
unauthorized changes could be made either inadvertently or deliberately
for fraudulent or malicious purposes. In addition, inadequate controls
over programs being developed or modified could make it difficult to
determine which version of the program is the most recent. Such an
environment can result in inefficiencies and could lead to
interruptions of service and monetary losses. For example,
* an unauthorized program could be substituted for the authorized
version;
* test programs could be labeled as production programs;
* two programmers could inadvertently access and work on the same test
program version simultaneously, making it difficult or impossible to
merge their work; or;
* unauthorized changes to either test or production programs could be
made and remain undetected.
Copies of software programs should be maintained in libraries where
they are labeled, dated, inventoried, and organized in a way that
diminishes the risk that programs will be misidentified or lost.
Library management software provides an automated means of inventorying
software (ensuring that differing versions are not accidentally
misidentified) and maintaining a record of software changes.
Specifically, such software can be used to:
* produce audit trails of program changes and maintain version number
control,
* record and report program changes made,
* automatically number program versions,
* identify creation date information,
* maintain copies of previous versions, and;
* control concurrent updates so that multiple programmers are prevented
from making changes to the same program in an uncontrolled manner.
The movement of programs and data among libraries should be controlled
by an entity group or person that is independent of both the user and
the programming staff. This group should be responsible for:
* moving programs from development/maintenance to user testing and from
user testing to production;
* supplying data from the production library for testing and creating
test data; and;
* controlling different program versions, especially when more than one
change is being performed on a program concurrently.
Before transferring a tested program from the user test library to the
production library, the independent library control group should (1)
generate a report that shows all changed source code (lines added,
changed, and deleted) and (2) compare this report to the user request
to ensure that only approved changes were made.
Many federal agencies have data processing operations that involve
multiple locations and require a coordinated effort for effective and
controlled distribution and implementation of new or revised software.
For example, an entity may have a central software design, development,
and maintenance activity, but have two or more regional data processing
centers running the same software. Once a modified software program has
been approved for use, the change should be communicated to all
affected parties and distributed and implemented in a way that leaves
no doubt about when it is to begin affecting processing. To accomplish
these objectives, an entity should have and follow established
procedures for announcing approved changes and their implementation
dates and for making the revised software available to those who need
to begin using it.
Source code programs (the code created by programmers) are compiled
into object or production code programs that are machine-readable and
become the versions that are actually used during data processing.
Source code programs should be closely controlled at a central location
and compiled into production programs before being distributed. Source
code should not be distributed to other locations. This helps protect
the source code from unauthorized changes and increases the integrity
of the object or production code, which is much more difficult for
programmers to change without access to the source code. Inadequately
controlling software distribution and implementation increases the risk
that data could be improperly processed due to:
* implementation of unapproved and possibly malicious software,
* continued use of outdated versions of software, and;
* inconsistent implementation dates resulting in inconsistent
processing of similar data at different locations.
With independent processing sites, each site is responsible for
implementing the correct version of the software at the predetermined
date and time and maintaining the documentation authorizing such
implementation. Conversely, implementing new software through one or
more central computers or servers minimizes the risk that the software
will be inconsistently implemented.
The use of public domain and personal software should be restricted. It
is important that an entity have clear policies regarding the use of
personal and public domain software by employees at work. Allowing
employees to use their own software or even diskettes for data storage
that have been used elsewhere increases the risk of introducing
viruses. It also increases the risk of violating copyright laws and
making bad decisions based on incorrect information produced by
erroneous software. As mentioned in section CM-5, virus identification
software can help contain damage from viruses that may be introduced
from unauthorized use of public domain, from personal software, or from
corrupted diskettes.
CM-3 Related NIST SP-800-53 Controls:
CM-3 Configuration Change Control;
SA-2 Allocation of Resources;
SA-3 Life Cycle Support;
SA-4 Acquisitions;
SA-8 Security Engineering Principles;
SA-10 Developer Configuration Management;
SA-11 Developer Security Testing.
Control Techniques and Suggested Audit Procedures for Critical Element
CM-3:
Table 25. Control Techniques and Suggested Audit Procedures for
Critical Element CM-3: Properly authorize, test, approve, and track all
configuration changes:
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Audit procedures:
Where appropriate, these audit procedures should be applied to both
internal and external developers and coordinated with section SM-7.
(Ensure that activities performed by external third parties are
adequately secure.)
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.1. An appropriate formal change management process is
documented.
Audit procedures:
Review the change management methodology for appropriateness. Review
system documentation to verify that the change management methodology
was followed.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.2. Configuration changes are authorized by management.
Configuration management actions are recorded in sufficient detail so
that the content and status of each configuration item is known and
previous versions can be recovered.
Audit procedures:
Examine a selection of CM and software change request forms for
approvals and sufficiency of detail. Interview CM management and
software development staff.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.3. Relevant stakeholders have access to and knowledge of the
configuration status of the configuration items.
Audit procedures:
Interview users and ensure that they have ready access to software
change requests, test reports, and configuration items associated with
the various baselines being managed.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.4. Detailed specifications are prepared by the programmer and
reviewed by a programming supervisor for system and application
software changes.
Audit procedures:
For the software change requests selected for control activity CM-
3.1.2:
* review specifications and related documentation for evidence of
supervisory review.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.5. Test plan standards have been developed for all levels of
testing that define responsibilities for each party (for example,
users, system analysts, programmers, auditors, quality assurance,
library control).
Audit procedures:
Review test plan standards.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.6. Test plans are documented and approved that define
responsibilities for each party involved (for example, users, systems
analysts, programmers, auditors, quality assurance, library control).
Audit procedures:
For the software change requests selected for control activity CM-
3.1.2:
* review test plans;
* compare test documentation with related test plans;
* analyze test failures to determine if they indicate ineffective
software testing;
* review test transactions and data;
* review test results;
* review documentation for appropriate supervisory or management
reviews;
* verify user acceptance; and;
* review updated documentation. Determine whether operational systems
experience a high number of system failures (for example, bends) and,
if so, whether they indicate inadequate testing before implementation.
Examine a selection of program changes to determine whether they were
approved by management prior to being moved to production.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.7. Test plans include appropriate consideration of security.
Audit procedures:
For the software change requests selected for control activity CM-
3.1.2:
* review test plans;
* compare test documentation with related test plans;
* analyze test failures to determine if they indicate ineffective
software testing;
* review test transactions and data;
* review test results;
* review documentation for appropriate supervisory or management
reviews;
* verify user acceptance; and;
* review updated documentation. Determine whether operational systems
experience a high number of system failures (for example, bends) and,
if so, whether they indicate inadequate testing before implementation.
Examine a selection of program changes to determine whether they were
approved by management prior to being moved to production.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.8. Unit, integration, and system testing are performed and
approved in accordance with the test plan and apply a sufficient range
of valid and invalid conditions.
Audit procedures:
For the software change requests selected for control activity CM-
3.1.2:
* review test plans;
* compare test documentation with related test plans;
* analyze test failures to determine if they indicate ineffective
software testing;
* review test transactions and data;
* review test results;
* review documentation for appropriate supervisory or management
reviews;
* verify user acceptance; and;
* review updated documentation. Determine whether operational systems
experience a high number of system failures (for example, bends) and,
if so, whether they indicate inadequate testing before implementation.
Examine a selection of program changes to determine whether they were
approved by management prior to being moved to production.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.9. A comprehensive set of test transactions and data is
developed that represents the various activities and conditions that
will be encountered in processing.
Audit procedures:
For the software change requests selected for control activity CM-
3.1.2:
* review test plans;
* compare test documentation with related test plans;
* analyze test failures to determine if they indicate ineffective
software testing;
* review test transactions and data;
* review test results;
* review documentation for appropriate supervisory or management
reviews;
* verify user acceptance; and;
* review updated documentation. Determine whether operational systems
experience a high number of system failures (for example, bends) and,
if so, whether they indicate inadequate testing before implementation.
Examine a selection of program changes to determine whether they were
approved by management prior to being moved to production.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.10. Live data are not used in testing of program changes, except
to build test data files.
Audit procedures:
For the software change requests selected for control activity CM-
3.1.2:
* review test plans;
* compare test documentation with related test plans;
* analyze test failures to determine if they indicate ineffective
software testing;
* review test transactions and data;
* review test results;
* review documentation for appropriate supervisory or management
reviews;
* verify user acceptance; and;
* review updated documentation. Determine whether operational systems
experience a high number of system failures (for example, bends) and,
if so, whether they indicate inadequate testing before implementation.
Examine a selection of program changes to determine whether they were
approved by management prior to being moved to production.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.11. Test results are documented and appropriate responsive
actions are taken based on the results.
Audit procedures:
For the software change requests selected for control activity CM-
3.1.2:
* review test plans;
* compare test documentation with related test plans;
* analyze test failures to determine if they indicate ineffective
software testing;
* review test transactions and data;
* review test results;
* review documentation for appropriate supervisory or management
reviews;
* verify user acceptance; and;
* review updated documentation. Determine whether operational systems
experience a high number of system failures (for example, bends) and,
if so, whether they indicate inadequate testing before implementation.
Examine a selection of program changes to determine whether they were
approved by management prior to being moved to production.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.12. Program changes are moved into production only when approved
by management and by persons independent of the programmer.
Audit procedures:
For the software change requests selected for control activity CM-
3.1.2:
* review test plans;
* compare test documentation with related test plans;
* analyze test failures to determine if they indicate ineffective
software testing;
* review test transactions and data;
* review test results;
* review documentation for appropriate supervisory or management
reviews;
* verify user acceptance; and;
* review updated documentation. Determine whether operational systems
experience a high number of system failures (for example, bends) and,
if so, whether they indicate inadequate testing before implementation.
Examine a selection of program changes to determine whether they were
approved by management prior to being moved to production.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.13. Standardized procedures are used to distribute new software
for implementation.
Audit procedures:
Examine procedures for distributing new software.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.14. Appropriate tools (for example, library mgt.software and
manual techniques) are used to:
* produce audit trails of program changes,
* maintain program version numbers,
* record and report program changes,
* maintain creation/date information for production modules,
* maintain copies of previous versions, and,
* control concurrent updates.
Audit procedures:
Review pertinent policies and procedures. Interview personnel
responsible for appropriate tools and library control. Examine a
selection of programs maintained in the library and assess compliance
with prescribed procedures. Determine whether documentation is
maintained on program changes, program version numbers, creation/date
information, and copies of prior versions. Review procedures for
controlling concurrent updates.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.15. Configuration/software changes are documented so that they
can be traced from authorization to the final approved code and they
facilitate �trace-back� of code to design specifications and functional
requirements by system testers.
Audit procedures:
For the software change requests selected for control activity CM-
3.1.2:
* trace changes from authorization to the final approved code; and,
* trace changes back from code to design specifications and functional
requirements.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.16. Program development and maintenance, testing, and production
programs are maintained separately (for example, libraries) and
movement between these areas is appropriately controlled, including
appropriate consideration of segregation of duties (see the Segregation
of Duties control area.
Audit procedures:
Review pertinent policies and procedures and interview library control
personnel. Examine libraries in use. Test access to program libraries
by examining security system parameters. Review program changes
procedures for adherence to appropriate segregation of duties between
application programming and movement of programs into production. For a
selection of program changes, examine related documentation to verify
that (1) procedures for authorizing movement among libraries were
followed and (2) before and after images were compared.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.17. Access to all programs, including production code, source
code, and extra program copies, are adequately protected.
Audit procedures:
For critical software production programs, determine whether access
control software rules are clearly defined. Test access to program
libraries by examining security system parameters.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.18. Configuration changes to network devices (for example,
routers and firewalls) are properly controlled and documented.
Audit procedures:
Review a sample of configuration settings to key devices and determine
if configuration changes are adequately controlled and documented.
Control activities:
CM-3.1. All configuration changes are properly managed (authorized,
tested, approved, and tracked).
Control techniques:
CM-3.1.19. Clear policies restricting the use of personal and public
domain software and prohibiting violations of software licensing
agreements have been developed and are enforced.
Audit procedures:
Review pertinent policies and procedures. Interview users and data
processing staff. Review and test management enforcement process.
Source GAO.
[End of table]
Critical Element CM-4. Routinely monitor the configuration:
Current configuration information should be routinely monitored for
accuracy. Monitoring should address the current baseline and
operational configuration of the hardware, software, and firmware that
comprise the information system. Information technology products should
comply with applicable standards and the vendors� good security
practices. The entity should have the capability to monitor and test
that it is functioning as intended. Also, networks should be
appropriately configured and monitored to adequately protect access
paths between information systems.
Monitoring, sometimes called configuration audits, should be
periodically conducted to determine the extent to which the actual
configuration item reflects the required physical and functional
characteristics originally specified by requirements. The configuration
plan should identify the frequency of configuration audits. A
configuration audit should be performed on a configuration item before
its release and it should be routinely tested thereafter. Configuration
audits establish that the functional and performance requirements
defined in the configuration documentation have been achieved by the
design and that the design has been accurately documented in the
configuration document. The purpose and benefits of the process include
the following:
* Ensures that the product design provides the agreed-to performance
capabilities;
* Validates the integrity of the configuration documentation;
* Verifies the consistency between a product and its configuration
documentation;
* Determines that an adequate process is in place to provide continuing
control of the configuration;
* Provides confidence in establishing a product baseline;
* Ensures a known configuration as the basis for operation and
maintenance instructions, and training. Security settings for network
devices, operating systems, and infrastructure applications need to be
monitored periodically to ensure that they have not been altered and
that they are set in the most restrictive mode consistent with the
information system operational requirements. NIST SP 800-70 provides
guidance on configuration settings (for example, checklists) for
information technology products.
A process and related procedures needs to be established to document
the results from monitoring configuration items and ensure that
discrepancies are properly corrected. For example, network and host
environments should be scanned on a regular basis to determine whether
patches have been effectively applied. A formal process with central
management helps to ensure patch compliance with the network
configuration. Audit results need to be recorded indicating:
* each discrete requirement,
* method of verification,
* verification procedures,
* verification results, and;
* corrective actions.
CM-4 Related NIST SP-800-53 Controls:
CM-4 Monitoring Configuration Changes;
CM-5 Access Restrictions for Change;
SI-7 Software and Information Integrity.
Control Techniques and Suggested Audit Procedures for Critical Element
CM-4:
Table 26. Control Techniques and Suggested Audit Procedures for
Critical Element CM-4: Routinely monitor the configuration:
Control activities:
CM-4.1. The configuration is routinely audited and verified.
Control techniques:
CM-4.1.1. Routinely validate that the current configuration information
is accurate, up-to-date, and working as intended for networks,
operating systems, and infrastructure applications.
Audit procedures:
Identify the standards and procedures used to audit and verify the
system configuration. Determine when and how often the configuration is
verified and audited. Review a sample of the configuration
verifications and audits for compliance with applicable standards.
Verify that vendor-supplied system software is still supported by the
vendor. Evaluate adequacy of the configuration audits based on the
results of the IS control audit tests performed.
Control activities:
CM-4.1. The configuration is routinely audited and verified.
Control techniques:
CM-4.1.2. The verification and validation criteria for the
configuration audit is appropriate and specifies how the configuration
item will be evaluated in terms of correctness, consistency, necessity,
completeness, and performance.
Audit procedures:
Review evaluation criteria for the release. Identify all configuration
items, deviations and waivers, and the status of tests. Determine if
configuration items have gaps in the documentation or if there are
defects in the change management process.
Control activities:
CM-4.1. The configuration is routinely audited and verified.
Control techniques:
CM-4.1.3. Confirm compliance with applicable configuration management
policy, plans, standards, and procedures.
Audit procedures:
Compare configuration policy, plans, standards, and procedures with
observations.
Control activities:
CM-4.1. The configuration is routinely audited and verified.
Control techniques:
CM-4.1.4. The information system periodically verifies the correct
operation of security functions�on system start up and restart, on
command by user with appropriate privilege�(providing system audit
trail documentation) and takes appropriate action (for example,
notifies system administrator, shuts the system down, restarts the
system) when anomalies are discovered.
Audit procedures:
Interview officials and review related system documentation. Observe or
test this system capability to determine that procedures are followed
and related system documentation is generated and reviewed by entity
security staff.
Source: GAO.
[End of table]
Critical Element CM-5. Update software on a timely basis to protect
against known vulnerabilities:
Software should be scanned and updated frequently to guard against
known vulnerabilities. In addition to periodically looking for software
vulnerabilities and fixing them, security software should be kept
current by establishing effective programs for patch management, virus
protection, and other emerging threats. Also, software releases should
be adequately controlled to prevent the use of noncurrent software.
Vulnerability scanning:
Using appropriate vulnerability scanning tools and techniques, entity
management should scan for vulnerabilities in the information system or
when significant new vulnerabilities affecting the system are
identified and reported. Audit procedures include review of the
scanning methodology and related results to ensure that significant
vulnerabilities are remediated in a timely manner. (See section SM-5.1,
table 9, for a description of vulnerability scanning.)
Patch management[Footnote 79]:
Patch management is a critical process used to help alleviate many of
the challenges involved with securing computing systems from attack. A
component of configuration management, it includes acquiring, testing,
applying, and monitoring patches to a computer system. Flaws in
software code that could cause a program to malfunction generally
result from programming errors that occur during software development.
The increasing complexity and size of software programs contribute to
the growth in software flaws. While most flaws do not create security
vulnerabilities, the potential for these errors reflects the difficulty
and complexity involved in delivering trustworthy code.
The federal government has taken several steps to address security
vulnerabilities that affect agency systems, including efforts to
improve patch management. Specific actions include (1) requiring
agencies to annually report on their patch management practices as part
of their implementation of FISMA, (2) identifying vulnerability
remediation as a critical area of focus in the President�s National
Strategy to Secure Cyberspace, and (3) creating US�CERT.
* FISMA permanently authorized and strengthened the information
security program, evaluation, and reporting requirements established
for federal agencies in prior legislation.[Footnote 80] In accordance
with OMB�s reporting instructions for FISMA implementation, maintaining
up-to-date patches is part of FISMA�s system configuration management
requirements.
* The President�s National Strategy to Secure Cyberspace, issued on
February 14, 2003, identifies priorities, actions, and responsibilities
for the federal government as well as for state and local governments
and the private sector. This strategy identifies the reduction and
remediation of software vulnerabilities as a critical area of focus.
* The US-CERT is intended to aggregate and disseminate cybersecurity
information to improve warning and response to incidents, increase
coordination of response information, reduce vulnerabilities, and
enhance prevention and protection. Services include notification of
software vulnerabilities and information on applicable patches.
Common patch management practices in security-related literature from
several groups, including NIST, Microsoft, patch management software
vendors, and other computer security experts include the following
elements:
* centralized patch management support and clearly assigned
responsibilities;
* senior executive support and assurance that appropriate patches are
deployed;
* standardized patch management policies, procedures, and tools;
* skills, knowledge, and training to perform patch management
responsibilities;
* current technology inventory of all hardware, software, and services
that are used;
* risk assessment based on the criticality of the vulnerability and
importance of the system;
* thorough testing before the patch is applied in a production
environment;
* monitoring through network and host vulnerability scanning; and;
* timely notification of relevant vulnerabilities and distribution of
critical patches.
Virus protection:
Protecting information systems from malicious computer viruses and
worms[Footnote 81] is a serious challenge. Computer attack tools and
techniques are becoming increasingly sophisticated; viruses are
spreading faster as a result of the increasing connectivity of today�s
networks; commercial-off-the-shelf products can be easily exploited for
attack by all their users; and there is no �silver bullet� solution
such as firewalls or encryption to protect systems. To combat viruses
and worms specifically, entities should take steps such as ensuring
that security personnel are adequately trained to respond to early
warnings of attacks and keeping antivirus programs up-to-date.
Strengthening intrusion detection capabilities and effective patch
management programs also help.
According to NIST, the information system (including servers,
workstations, and mobile computing devices) should implement malicious
code protection that includes a capability for automatic updates. Virus
definitions should be kept up-to-date. Virus-scanning software should
be provided at critical entry points, such as remote-access servers and
at each desktop system on the network. Anti-viral mechanisms should be
used to detect and eradicate viruses in incoming and outgoing e-mail
and attachments.
Emerging threats:
Entities are facing a set of emerging cybersecurity threats that are
the result of changing sources of attack, increasingly sophisticated
social engineering techniques designed to trick the unsuspecting user
into divulging sensitive information, new modes of covert compromise,
and the blending of once distinct attacks into more complex and
damaging exploits. Advances in antispam measures have caused spammers
to increase the sophistication of their techniques to bypass detection;
the frequency and sophistication of phishing[Footnote 82] attacks have
likewise increased, and spyware[Footnote 83] has proven to be difficult
to detect and remove.
The risks that entities face are significant. Spam consumes employee
and technical resources and can be used as a delivery mechanism for
malware[Footnote 84] and other cyberthreats. Entities and their
employees can be victims of phishing scams, and spyware puts the
confidentiality, integrity, and availability of entity systems at
serious risk. Other emerging threats include the increased
sophistication of worms, viruses, and other malware, and the increased
attack capabilities of blended threats and botnets.[Footnote 85]
The transition to the new Internet protocol version 6 (IPv6) creates
new security risks. The Internet protocol provides the addressing
mechanism that defines how and where information moves across
interconnected networks. The key characteristics of IPv6 are designed
to increase address space, promote flexibility and functionality, and
enhance security. However, as IPv6-capable software and devices
accumulate in entity networks, they could be abused by attackers if not
managed properly. Specifically, some existing firewalls and intrusion
detection systems do not provide IPv6 detection or filtering
capability, and malicious users might be able to send IPv6 traffic
through these security devices undetected. Configuration management can
mitigate this threat by tightening firewalls to deny direct outbound
connections and tuning intrusion detection systems to detect IPv6
traffic.
Voice over Internet Protocol (VoIP) technologies may also cause damage
to the information system if used maliciously. To mitigate this threat,
the entity should establish usage restrictions and implementation
guidance for VoIP and document, monitor, and control the use of VoIP.
NIST SP 800-58 provides guidance on security considerations for VOIP
technologies employed in information systems.
An effective security program can assist in entity efforts to mitigate
and respond to these emerging cybersecurity threats. First of all, the
risks of emerging cybersecurity threats should be addressed as part of
required entitywide information security programs, which include
performing periodic assessments of risk. Secondly, security controls
commensurate with the identified risk should be implemented. Thirdly,
ensuring security awareness training for entity personnel is critical.
Comprehensive procedures for detecting, reporting, and responding to
security incidents should be implemented. An effective security
program, related control techniques, and proposed audit procedures are
discussed in the security management section of FISCAM.
As part of the entity security program, effective configuration of
layered security (Defense-in-Depth) mitigates the risks from individual
cybersecurity threats. Layered security implemented within an agency�s
security architecture includes the use of strong passwords, patch
management, antivirus software, firewalls, software security settings,
backup files, vulnerability assessments, and intrusion detection
systems. Figure 5 depicts an example of how entities can use layered
security controls to mitigate the risks of individual cybersecurity
threats.
Figure 5. Layered Security Mitigates the Risk of Individual
Cybersecurity Threats:
[See PDF for image]
This figure is an illustration of how layered security mitigates the
risk of individual cybersecurity threats.
The following information is depicted:
Current individual threats:
Internet:
* Virus;
* Spam;
* Worm;
* Spyware;
* Phishing.
Network controls:
Intrusion detection system:
* Firewall;
* E-mail spam filter;
* E-mail antivirus.
Workstation controls:
* Personal firewalls;
* Desktop antivirus;
* Workstation configuration.
Source: GAO.
Note: Excerpt from GAO, Cybersecurity Issues Threaten Federal
Information Systems, GAO-05-231 (Washington, D.C.: May 2005).
[End of figure]
Noncurrent software:
Procedures should ensure that only current software releases are
installed in information systems. Noncurrent software may be vulnerable
to malicious code such as viruses and worms.
As mentioned previously under CM-3, many federal agencies have data
processing operations that involve multiple locations and require a
coordinated effort for effective and controlled distribution and
implementation of new or revised software. This can include virus
protection software and operating system patches. Once a modified
software program has been approved for use, the change should be
communicated to all affected parties and distributed and implemented in
a way that leaves no doubt about when it is to begin affecting
processing. Inadequately controlling virus software distribution and
system patches increases the risk that data could be improperly
processed or lose its confidentiality due to computer viruses and
hackers breaking into the database.
Software usage:
Policies and procedures should be implemented to reasonably assure that
the entity complies with software usage restrictions. In addition, the
entity should have policies and procedures implemented that address the
installation of software by users and procedures to determine that such
policies and procedures are adhered to.
CM-5 Related NIST SP-800-53 Controls:
RA-5 Vulnerability Scanning;
SA-6 Software Usage Restrictions;
SA-7 User Installed Software;
SC-19 Voice Over Internet Protocol;
SI-2 Flaw Remediation;
SI-3 Malicious Code Protection;
SI-5 Security Alerts and Advisories;
SI-8 Spam Protection.
Control Techniques and Suggested Audit Procedures for Critical Element
CM-5:
Table 27. Control Techniques and Suggested Audit Procedures for
Critical Element CM-5: Update software on a timely basis to protect
against known vulnerabilities:
Control activities:
CM-5.1. Software is promptly updated to protect against known
vulnerabilities.
Control techniques:
CM-5.1.1. Information systems are scanned periodically to detect known
vulnerabilities.
Audit procedures:
Interview entity officials. Identify the criteria and methodology used
for scanning, tools used, frequency, recent scanning results, and
related corrective actions. Coordinate this work with the AC section.
Control activities:
CM-5.1. Software is promptly updated to protect against known
vulnerabilities.
Control techniques:
CM-5.1.2. An effective patch management process is documented and
implemented, including:
* identification of systems affected by recently announced software
vulnerabilities;
* prioritization of patches based on system configuration and risk;
* appropriate installation of patches on a timely basis, including
testing for effectiveness and potential side effects on the agency�s
systems; and;
* verification that patches, service packs, and hotfixes were
appropriately installed on affected systems.
Audit procedures:
Review pertinent policies and procedures. Interview users and data
processing staff.
Control activities:
CM-5.1. Software is promptly updated to protect against known
vulnerabilities.
Control techniques:
CM-5.1.3. Software is up-to-date; the latest versions of software
patches are installed.
Audit procedures:
Compare vendor recommended patches to those installed on the system. If
patches are not up-to-date, determine why they have not been installed.
Control activities:
CM-5.1. Software is promptly updated to protect against known
vulnerabilities.
Control techniques:
CM-5.1.4. An effective virus, spam, and spyware protection process is
documented and implemented, including:
* appropriate policies and procedures;
* effective protection software is installed that identifies and
isolates suspected viruses, spam, and spyware; and;
* virus, spam, and spyware definitions are up-to-date.
Audit procedures:
Review pertinent policies and procedures. Interview users and data
processing staff. Verify that actual software is installed and up-to-
date.
Control activities:
CM-5.1. Software is promptly updated to protect against known
vulnerabilities.
Control techniques:
CM-5.1.5. The entity: (1) establishes usage restrictions and
implementation guidance for IPv6 technology based on the potential to
cause damage to the information system if used maliciously and (2)
documents, monitors, and controls the use of IPv6 within the
information system. Appropriate organizational officials authorize the
use of IPv6.
Audit procedures:
Review policies and procedures for IPv6. Determine if known security
vulnerabilities are mitigated by appropriate protective measures.
Control activities:
CM-5.1. Software is promptly updated to protect against known
vulnerabilities.
Control techniques:
CM-5.1.6. The entity: (1) establishes usage restrictions and
implementation guidance for VoIP technologies based on the potential to
cause damage to the information system if used maliciously and (2)
documents, monitors, and controls the use of VoIP within the
information system. Appropriate organizational officials authorize the
use of VoIP.
Audit procedures:
Review policies and procedures for VoIP. Determine if security
considerations in NIST SP 800-58 are used in the information system.
Control activities:
CM-5.1. Software is promptly updated to protect against known
vulnerabilities.
Control techniques:
CM-5.1.7. Noncurrent software releases are adequately secure, given the
risk.
Audit procedures:
Review pertinent policies and procedures. Interview users and data
processing staff.
Control activities:
CM-5.1. Software is promptly updated to protect against known
vulnerabilities.
Control techniques:
CM-5.1.8. Appropriate software usage controls (software restrictions,
user-installed software) are implemented and exceptions are identified.
Audit procedures:
Assess the adequacy of software usage controls.
Source: GAO.
[End of table]
Critical Element CM-6. Appropriately document and approve emergency
changes to the configuration:
Emergency changes to the information system should be documented and
approved by appropriate entity officials, either before the change or
after the fact. In addition, appropriate personnel should be notified
to provide analysis and follow-up.
It is not uncommon for program changes to be needed on an emergency
basis to keep a system operating. Some applications, such as payroll
processing, are performed in cycles that must be completed by a
deadline. Other systems must be continuously available so that the
operations they support are not interrupted. In these cases, the risk
of missing a deadline or disrupting operations may pose a greater risk
than that of temporarily suspending program change controls. However,
because of the increased risk that errors or other unauthorized
modifications could be implemented, emergency changes should be kept to
a minimum.
It is important that an entity follow established procedures to perform
emergency software changes and reduce the risk of suspending or
abbreviating normal controls. Generally, emergency procedures should
specify:
* when emergency software changes are warranted,
* who may authorize emergency changes,
* how emergency changes are to be documented, and,
* within what period after implementation the change must be tested and
approved.
Making emergency changes often involves using sensitive system
utilities or access methods that grant much broader access than would
normally be needed. It is important that such access is strictly
controlled and that their use be promptly reviewed.
Shortly after an emergency change is made, the usual configuration
management controls should be applied retroactively. That is, the
change should be subjected to the same review, testing, and approval
process that applies to scheduled changes. In addition, logs of
emergency changes and related documentation should be periodically
reviewed by data center management or security administrators to
determine whether all such changes have been tested and have received
final approval.
Control Techniques and Suggested Audit Procedures for Critical Element
CM-6:
Table 28. Control Techniques and Suggested Audit Procedures for
Critical Element CM-6: Appropriately document and approve emergency
changes to the configuration:
Control activities:
CM-6.1. Adequate procedures for emergency changes are documented and
implemented.
Control techniques:
CM-6.1.1. Appropriately document and implement procedures for emergency
changes.
Audit procedures:
Review procedures.
Control activities:
CM-6.2. Emergency changes to the configuration are documented and
approved.
Control techniques:
CM-6.2.1. Appropriately document and approve emergency changes to the
configuration and notify appropriate personnel for analysis and follow-
up.
Audit procedures:
For a selection of emergency changes recorded in the emergency change
log, review related documentation and approval.
Source: GAO.
[End of table]
3.4. Segregation of Duties (SD):
Effective segregation of duties starts with effective entitywide
policies and procedures that are implemented at the system and
application levels. Work responsibilities should be segregated so that
one individual does not control all critical stages of a process. For
example, while users may authorize program changes, programmers should
not be allowed to do so because they are not the owners of the system
and do not have the responsibility to see that the system meets user
needs. Similarly, one computer programmer should not be allowed to
independently write, test, and approve program changes. Often,
segregation of duties is achieved by splitting responsibilities between
two or more organizational groups. Dividing duties this way diminishes
the likelihood that errors and wrongful acts will go undetected because
the activities of one group or individual will serve as a check on the
activities of the other.
Inadequately segregated duties, conversely, increase the risk that
erroneous or fraudulent transactions could be processed, that improper
program changes could be implemented, and that computer resources could
be damaged or destroyed. For example:
* An individual who is independently responsible for authorizing,
processing, and reviewing payroll transactions could inappropriately
increase payments to selected individuals without detection.
* A computer programmer responsible for authorizing, writing, testing,
and distributing program modifications could either inadvertently or
deliberately implement computer programs that did not process
transactions in accordance with management�s policies or that included
malicious code.
The extent to which duties are segregated depends on the size of the
entity and the risk associated with its facilities and activities. A
large entity will have more flexibility in separating key duties than
will a small entity that must depend on only a few individuals to
perform its operations. These smaller entities may rely more
extensively on supervisory review to control activities. Similarly,
activities that involve extremely large dollar transactions or are
otherwise inherently risky should be divided among several individuals
and be subject to relatively extensive supervisory review.
Key areas of concern during a general controls review involve the
segregation of duties among major operating and programming activities,
including duties performed by users, application programmers, and data
center staff. For example, where possible, the following types of
activities should be separated: development versus production, security
versus audit, accounts payable versus accounts receivable, and
encryption key management versus the changing of keys. Entitywide
policies outlining the responsibilities of groups and related
individuals pertaining to incompatible activities should be documented,
communicated, and enforced.
Because of the nature of computer operations, segregation of duties
alone will not ensure that personnel perform only authorized
activities, especially computer operators. Preventing or detecting
unauthorized or erroneous personnel actions requires effective
supervision and review by management and formal operating procedures.
Determining whether duties are adequately segregated and that the
activities of personnel are adequately controlled involves assessing
the agency�s efforts in performing each of the critical elements listed
in table 29.
SD Related NIST SP-800-53 Controls:
AC-5 Separation of Duties;
PS-2 Position Categorization;
PS-6 Access Agreements.
Table 29. Critical Elements for Segregation of Duties:
Number: SD-1.
Description: Segregate incompatible duties and establish related
policies.
Number: SD-2.
Description: Control personnel activities through formal operating
procedures, supervision, and review.
Source: GAO.
[End of table]
Critical Element SD-1. Segregate incompatible duties and establish
related policies:
The first steps in determining if duties are appropriately segregated
are to analyze the agency�s operations, identify incompatible duties,
and assign these duties to different organizational units or
individuals. Federal internal control standards specify that key duties
and responsibilities for authorizing, processing, recording, and
reviewing transactions should be separated. This concept can also be
applied to the authorization, testing, and review of computer program
changes.
Segregating duties begins by establishing independent organizational
groups with defined functions, such as a payroll unit responsible for
preparing payroll transaction input and a data processing unit
responsible for processing input prepared by other units. Functions and
related tasks performed by each unit should be documented for the unit
and written in job descriptions and should be clearly communicated to
personnel assigned the responsibilities.
Both physical and logical access controls can be used to enforce many
entity policies regarding segregation of duties and should be based on
organizational and individual job responsibilities. (Access control is
discussed in detail in section 3.2.) For example, logical access
controls can preclude computer programmers from using applications
software or accessing computerized data associated with applications.
Similarly, physical access controls, such as key cards and a security
guard, can be used to prevent unauthorized individuals from entering a
data processing center.
SD-1.1. Incompatible duties have been identified and policies
implemented to segregate these duties:
Management should have analyzed operations and identified incompatible
duties that are then segregated through policies and organizational
divisions. Although incompatible duties may vary from one entity to
another, the following functions are generally performed by different
individuals: information security management, systems design,
applications programming, systems programming, quality assurance and
testing, library management/ change management, computer operations,
production control and scheduling, data security, data administration,
network administration, and configuration management. A brief
description of these functions follows.
Information security management includes the personnel who direct or
manage the activities and staff of the information security department
and its various organizational components.
Systems design is the function of identifying and understanding user
information needs and translating them into a requirements document
that is used to build a system.
Applications programming involves the development and maintenance of
programs for specific applications, such as payroll, inventory control,
accounting, and mission support systems.
Systems programming involves the development and maintenance of
programs that form the system software, such as operating systems,
utilities, compilers, and security software.
Quality assurance/testing involves the review and testing of newly-
developed systems and modifications to determine whether they function
as specified and perform in accordance with functional specifications.
Testing may also determine whether appropriate procedures, controls,
and documentation have been developed and implemented before approval
is granted to place the system into operation.
Library management/change management is the control over program and
data files that are either kept on-line or are on tapes and disks that
are loaded onto the computer as needed. Software programs are generally
used to assist in management of these files. This function also is
often responsible for controlling documentation related to system
software, application programs, and computer operations.
Computer operations involves performing the various tasks to operate
the computer and peripheral equipment, including providing the tape,
disk, or paper resources as requested by the applications systems.
Production control and scheduling involves monitoring the information
into, through, and as it leaves the computer operations area, and for
determining the succession of programs to be run on the computer.
Often, an automated scheduling package is used in this task. An entity
may have a separate data control group that is responsible for seeing
that all data necessary for processing are present and that all output
is complete and distributed properly. This group is usually also
responsible for reconciling record counts and control totals submitted
by users with similar counts and totals generated during processing.
The data security function in an IT department involves the development
and administration of an agency�s information security program. This
includes development of security policies, procedures, and guidelines
and the establishment and maintenance of a security awareness and
education program for employees. This function is also concerned with
the adequacy of access controls and service continuity procedures.
Data administration involves planning for and administering the data
used throughout the entity. This function is concerned with
identifying, cataloging, controlling, and coordinating the information
needs of the entity. Database administration is a narrower function
concerned with the technical aspects of installing, maintaining, and
using an agency�s databases and database management systems.
Network administration involves maintaining a secure and reliable on-
line communications network and serving as liaison with user
departments to resolve network needs and problems.
Configuration management involves controlling and documenting changes
made to a system�s hardware, software, firmware, and documentation
throughout the development and operational life of the system.
The following include examples of restrictions that are generally
addressed in policies about segregating duties and are achieved through
organizational divisions and access controls:
* Application users should not have access to operating systems or
applications software.
* Programmers should not be responsible for moving programs into
production or have access to production libraries or data. ? Access to
operating system documentation should be restricted to authorized
systems programming personnel.
* Access to applications system documentation should be restricted to
authorized applications programming personnel.
* Access to production software libraries should be restricted to
library management personnel.
* Persons other than computer operators should not set up or operate
the production computer.
* Only users�not computer staff�should be responsible for transaction
origination or correction and for initiating changes to application
files.
* Computer operators should not have access to program libraries or
data files.
Some steps involved in processing a transaction also need to be
separated among different individuals. For example, the following
combinations of functions should not be performed by a single
individual:
* Data entry and verification of data.
* Data entry and its reconciliation to output.
* Input of transactions for incompatible processing functions (for
example, input of vendor invoices and purchasing and receiving
information).
* Data entry and supervisory authorization functions (for example,
authorizing a rejected transaction to continue processing that exceeds
some limit requiring a supervisor�s review and approval).
Organizations with limited resources to segregate duties should have
compensating controls, such as supervisory review of transactions
performed.
SD-1.2. Job descriptions have been documented:
Documented job descriptions should exist that clearly describe employee
duties and prohibited activities. These should include responsibilities
that may be assumed during emergency situations. The documented job
descriptions should match employees� assigned duties. Also, they should
include definitions of the technical knowledge, skills, and abilities
required for successful performance in the relevant position, and
should be useful for hiring, promoting, and performance evaluation
purposes. In addition, the organization should assign a risk
designation to all positions and establish screening criteria for
individuals filling those positions.
SD-1.3. Employees understand their duties and responsibilities:
Employees and their supervisors should understand their
responsibilities and the activities that are prohibited. Ultimate
responsibility for this rests with senior managers. They should provide
the resources and training so that employees understand their
responsibilities and ensure that segregation-of-duties principles are
established, enforced, and institutionalized within the organization.
Control Techniques and Suggested Audit Procedures for Critical Element
SD-1:
Table 30. Control Techniques and Suggested Audit Procedures for
Critical Element SD-1: Segregate incompatible duties and establish
related policies:
Control activities:
SD-1.1. Incompatible duties have been identified and policies
implemented to segregate these duties.
Control techniques:
SD-1.1.1. Policies and procedures for segregating duties exist and are
up-to-date.
Audit procedures:
Review pertinent policies and procedures. Interview selected management
and information security personnel regarding segregation of duties.
Control activities:
SD-1.1. Incompatible duties have been identified and policies
implemented to segregate these duties.
Control techniques:
SD-1.1.2. Distinct system support functions are performed by different
individuals, including the following:
* information security management;
* systems design;
* applications programming;
* systems programming;
* quality assurance/testing;
* library management/change management;
* computer operations;
* production control and scheduling;
* data control;
* data security;
* data administration;
* network administration;
* configuration management.
Audit procedures:
Review an entity organization chart showing information security
functions and assigned personnel. Interview selected personnel and
determine whether functions are appropriately segregated. Determine
whether the chart is current and each function is staffed by different
individuals. Review relevant alternate or back up assignments and
determine whether the proper segregation of duties is maintained.
Observe activities of personnel to determine the nature and extent of
the compliance with the intended segregation of duties.
Control activities:
SD-1.1. Incompatible duties have been identified and policies
implemented to segregate these duties.
Control techniques:
SD-1.1.3. No individual has complete control over incompatible
transaction processing functions. Specifically, the following
combination of functions are not performed by a single individual:
* data entry and verification of data;
* data entry and its reconciliation to output;
* input of transactions for incompatible processing functions (for
example, input of vendor invoices and purchasing and receiving
information);
* data entry and supervisory authorization functions (for example,
authorizing a rejected transaction to continue processing that exceeds
some limit requiring a supervisor�s review and approval).
Audit procedures:
Review the organizational chart and interview personnel to determine
that assignments do not result in a single person being responsible for
the indicated combinations of functions. Observe activities of
personnel to determine the nature and extent of the compliance with the
intended segregation of duties.
Control activities:
SD-1.1. Incompatible duties have been identified and policies
implemented to segregate these duties.
Control techniques:
SD-1.1.4. Organizations with limited resources to segregate duties have
compensating controls, such as supervisory review of transactions
performed.
Audit procedures:
Interview management, observe activities, and test transactions. Note:
Perform this in conjunction with SD-2.2.
Control activities:
SD-1.1. Incompatible duties have been identified and policies
implemented to segregate these duties.
Control techniques:
SD-1.1.5. Data processing personnel are not users of information
systems. They and security managers do not initiate, input, or correct
transactions.
Audit procedures:
Determine through interview and observation whether data processing
personnel and security managers are prohibited from these activities.
Control activities:
SD-1.1. Incompatible duties have been identified and policies
implemented to segregate these duties.
Control techniques:
SD-1.1.6. Day-to-day operating procedures for the data center are
adequately documented and prohibited actions are identified.
Audit procedures:
Review the adequacy of documented operating procedures for the data
center.
Control activities:
SD-1.1. Incompatible duties have been identified and policies
implemented to segregate these duties.
Control techniques:
SD-1.1.7. Access controls enforce segregation of duties.
Audit procedures:
Audit procedures are found in section AC-3.1, but this item is listed
here as a reminder. Logical and physical access controls should enforce
segregation of duties.
Control activities:
SD-1.2. Job descriptions have been documented.
Control techniques:
SD-1.2.1. Documented job descriptions accurately reflect assigned
duties and responsibilities and segregation of duty principles.
Audit procedures:
Review job descriptions for several positions in organizational units
and for user security administrators. Determine whether duties are
clearly described and prohibited activities are addressed. Review the
effective dates of the position descriptions and determine whether they
are current. Compare these descriptions with the current
responsibilities and duties of the incumbents in these positions to
determine the accuracy of these statements.
Control activities:
SD-1.2. Job descriptions have been documented.
Control techniques:
SD-1.2.2. Documented job descriptions include definitions of the
technical knowledge, skills, and abilities required for successful
performance in the relevant position and can be used for hiring,
promoting, and performance evaluation purposes.
Audit procedures:
Review job descriptions and interview management personnel.
Control activities:
SD-1.3. Employees understand their duties and responsibilities.
Control techniques:
SD-1.3.1. All employees fully understand their duties and
responsibilities and carry out those responsibilities in accordance to
their job descriptions.
Audit procedures:
Interview personnel filling positions for the selected job descriptions
(see SD-1.2). Determine if the descriptions match their understanding
of their duties and responsibilities and whether additional duties are
undertaken that are not listed in their job descriptions.
Control activities:
SD-1.3. Employees understand their duties and responsibilities.
Control techniques:
SD-1.3.2. Senior management is responsible for providing adequate
resources and training to ensure that segregation of duty principles
are understood and established, enforced, and institutionalized within
the organization.
Audit procedures:
Determine from interviewing personnel whether senior management has
provided adequate resources and training to establish, enforce, and
institutionalize the principles of segregation of duties.
Control activities:
SD-1.3. Employees understand their duties and responsibilities.
Control techniques:
SD-1.3.3. Responsibilities for restricting access by job positions in
key operating and programming activities are clearly defined,
understood, and followed.
Audit procedures:
Interview management personnel in these activities.
Source: GAO.
[End of table]
Critical Element SD-2. Control personnel activities through formal
operating procedures, supervision, and review:
Control over personnel activities requires formal operating procedures
and active supervision and review of these activities. This is
especially relevant for computer operators and system administrators.
Some information system officials have extensive access rights in order
to keep the systems running efficiently so their activities need to be
monitored closely. Inadequacies in this area could allow mistakes to
occur and go undetected and facilitate unauthorized use of the
computer.
SD-2.1. Formal procedures guide personnel in performing their duties:
Detailed, written instructions should be followed to guide personnel in
performing their duties. These instructions are especially important
for computer operators. For example, computer operator instruction
manuals should provide guidance on system start up and shut down
procedures, emergency procedures, system and job status reporting, and
operator-prohibited activities. Application-specific manuals (commonly
called run manuals) should provide additional instructions for
operators specific to each application, such as instructions on job
setup, console and error messages, job checkpoints, and restart and
recovery steps after system failures. Operators should be prevented
from overriding file label or equipment error messages.
SD-2.2. Active supervision and review are provided for all personnel:
Supervision and review of personnel computer systems activities help
make certain that these activities are performed in accordance with
prescribed procedures, that mistakes are corrected, and that the
computer is used only for authorized purposes. To aid in this
oversight, all user activities on the computer system should be
recorded on activity logs, which serve as an audit trail. Supervisors
should routinely review these activity logs for incompatible actions
and investigate any abnormalities.
Periodic management reviews of computer systems activities are
essential to ensure that employees are performing their duties in
accordance with established policies and to identify the need to update
policies when operational processes change. In particular, management
should periodically review activities that cannot be controlled by
physical or logical access controls. Such activities are typically
controlled instead by supervisory oversight and documentation showing
approvals and authorizations.
Control Techniques and Suggested Audit Procedures for Critical Element
SD-2:
Table 31. Control Techniques and Suggested Audit Procedures for
Critical Element SD-2: Control personnel activities through formal
operating procedures, supervision, and review:
Control activities:
SD-2.1. Formal procedures guide personnel in performing their duties.
Control techniques:
SD-2.1.1. Detailed, written instructions exist and are followed for the
performance of work.
Audit procedures:
Review manuals. Interview supervisors and personnel. Observe processing
activities.
Control activities:
SD-2.1. Formal procedures guide personnel in performing their duties.
Control techniques:
SD-2.1.2. Instruction manuals provide guidance on system operation.
Audit procedures:
Review manuals. Interview supervisors and personnel. Observe processing
activities.
Control activities:
SD-2.1. Formal procedures guide personnel in performing their duties.
Control techniques:
SD-2.1.3. Application run manuals provide instruction on operating
specific applications.
Audit procedures:
Review manuals. Interview supervisors and personnel. Observe processing
activities.
Control activities:
SD-2.2. Active supervision and review are provided for all personnel.
Control techniques:
SD-2.2.1. Personnel are provided adequate supervision and review,
including each shift for computer operations.
Audit procedures:
Interview supervisors and personnel. Observe processing activities.
Control activities:
SD-2.2. Active supervision and review are provided for all personnel.
Control techniques:
SD-2.2.2. Access authorizations are periodically reviewed for
incompatible functions.
Audit procedures:
Review sample of access authorizations for incompatible functions and
evidence of supervisory review.
Control activities:
SD-2.2. Active supervision and review are provided for all personnel.
Control techniques:
SD-2.2.3. Management reviews are performed to determine that control
techniques for segregating incompatible duties are functioning as
intended and that the control techniques in place are maintaining risks
within acceptable levels (for example, periodic risk assessments).
Audit procedures:
Determine which reviews are conducted to assess the adequacy of duty
segregation. Obtain and review results of such reviews. Note: This
audit step should be performed in conjunction with audit steps in
critical elements SM-2 (Periodically assess and validate risks) and SM-
5 (Monitor the effectiveness of the security program).
Control activities:
SD-2.2. Active supervision and review are provided for all personnel.
Control techniques:
SD-2.2.4. Staff performance is monitored on a periodic basis and
controlled to ensure that objectives laid out in job descriptions are
carried out.
Audit procedures:
Interview management and subordinate personnel. Select documents or
actions requiring supervisory review and approval for evidence of such
performance (for example, approval of input of transactions, software
changes).
Control activities:
SD-2.2. Active supervision and review are provided for all personnel.
Control techniques:
SD-2.2.5. Supervisors routinely review user activity logs for
incompatible actions and investigate any abnormalities.
Audit procedures:
Interview supervisors and review user activity logs for incompatible
actions. Check for evidence of supervisory review.
Source: GAO.
[End of table]
3.5. Contingency Planning (CP):
Losing the capability to process, retrieve, and protect electronically
maintained information can significantly affect an agency�s ability to
accomplish its mission. If contingency planning controls are
inadequate, even relatively minor interruptions can result in lost or
incorrectly processed data, which can cause financial losses, expensive
recovery efforts, and inaccurate or incomplete information. For some
operations, such as those involving health care or safety, system
interruptions could even result in injuries or loss of life.
Given these severe implications, it is critical that an entity have in
place (1) procedures for protecting information resources and
minimizing the risk of unplanned interruptions and (2) a plan to
recover critical operations should interruptions occur. Such plans
should consider the activities performed at general support facilities,
such as data processing centers and telecommunications facilities, as
well as those performed by users of specific applications. To determine
whether recovery plans will work as intended, they should be tested
periodically in disaster-simulation exercises. FISMA requires that each
federal agency implement an information security program that includes
�plans and procedures to ensure continuity of operations for
information systems that support the operations and assets of the
agency.�
Although often referred to as disaster recovery or contingency plans,
controls to ensure service continuity should address the entire range
of potential disruptions. These may include relatively minor
interruptions, such as temporary power failures, as well as major
disasters, such as fires, natural disasters, and terrorism, that would
require reestablishing operations at a remote location; it might also
include errors, such as writing over a file. If controls are
inadequate, even relatively minor interruptions can result in lost or
incorrectly processed data.
To mitigate service interruptions, it is essential that the related
controls be understood and supported by management and staff throughout
the entity. Senior management commitment is especially important to
ensuring that adequate resources are devoted to emergency planning,
training, and related testing. Also, the involvement of data and
process owners is integral to contingency planning, as they have first-
hand knowledge of their data and processes and of the impact of a loss
of availability. In addition, all staff with contingency planning
responsibilities, such as those responsible for backing up files,
should be fully aware of the risks of not fulfilling those duties.
Assessing contingency planning controls involves evaluating the
agency�s performance in each of the critical elements listed in table
32.
Table 32. Critical Elements for Contingency Planning:
Number: CP-1.
Description: Assess the criticality and sensitivity of computerized
operations and identify supporting resources.
Number: CP-2.
Description: Take steps to prevent and minimize potential damage and
interruption.
Number: CP-3.
Description: Develop and document a comprehensive contingency plan.
Number: CP-4.
Description: Periodically test the contingency plan and adjust it as
appropriate.
Source: GAO.
[End of table]
Critical Element CP-1. Assess the criticality and sensitivity of
computerized operations and identify supporting resources:
At most entities, the continuity of certain automated operations is
more important than for other operations, and it is not cost effective
to provide the same level of continuity for all operations. For this
reason, it is important that management analyze data and operations to
determine which are the most critical and what resources are needed to
recover and support them. This is the first step in determining which
resources merit the greatest protection and what contingency plans need
to be made.
As explained in SM-2, FISMA required NIST to develop standards and
guidelines for agencies to use in categorizing federal information and
information systems so agencies can provide the appropriate level of
information security according to a range of risks. This information is
useful in assessing risks and the criticality and sensitivity of
computerized operations, and in identifying supporting resources. It is
also very important to link this information to the agency�s mission
and critical business processes.
According to NIST, the definition of an organization�s critical mission
or business functions is often called a business plan, and it is used
to support contingency planning.[Footnote 86] Part of business planning
involves the development of a business continuity plan that focuses on
sustaining an organization�s business functions during and after a
disruption. A business continuity plan can be written for a specific
business process or it may address all key business processes. Because
there is an inherent relationship between an IT system and the business
process it supports, there should be coordination between each plan,
and ultimately an entity may use a suite of plans for its IT systems,
business processes, and the facility.[Footnote 87] In addition, a
business impact analysis should be conducted to (1) identify critical
information technology resources, (2) identify outage impact and
allowable outage times, and (3) develop recovery priorities. The
purpose of the business impact analysis is to correlate specific system
components with the critical services that they provide and, based on
that information, to characterize the consequences if system components
were to be disrupted.
CP-1.1. Critical data and operations are identified and prioritized:
The criticality and sensitivity of various data and operations should
be determined and prioritized based on security categorizations and an
overall risk assessment of the agency�s operations. As discussed in
section 3.1, Entitywide Security Management Program, such a risk
assessment should serve as the foundation of an agency�s security plan.
Factors to be considered include the importance and sensitivity of the
data and other organizational assets handled or protected by the
individual operations, and the cost of not restoring data or operations
promptly. For example, a 1-day interruption of major tax or fee-
collection systems or a loss of related data could significantly slow
or halt receipt of revenues, diminish controls over millions of dollars
in receipts, and reduce public trust. Conversely, a system that
monitors employee training could be out of service for perhaps as much
as several months without serious consequences. Further, sensitive
data, such as personal information on individuals or information
related to contract negotiations, may require special protection during
a suspension of normal service, even if such information is not needed
on a daily basis to carry out critical operations.
Generally, critical data and operations should be identified and ranked
by those personnel involved in the agency�s business or program
operations. For example, managers should predict the negative effects
of lost data and interrupted operations and determine how long specific
operations can be suspended or postponed. However, it is also important
to obtain senior management�s agreement with such determinations, as
well as concurrence from affected groups.
The prioritized listing of critical information resources and
operations should be periodically reviewed to determine whether current
conditions are reflected in it. Such reviews should occur whenever
there is a significant change in the agency�s mission and operations or
in the location or design of the systems that support these operations.
CP-1.2. Resources supporting critical operations are identified and
analyzed:
Once critical data and operations have been determined, the minimum
resources needed to support them should be identified and their roles
analyzed. The resources to be considered include computer resources,
such as hardware, software, and data files; networks, including
components such as routers and firewalls; supplies, including paper
stock and preprinted forms; telecommunications services; and any other
resources that are necessary to the operation, such as people, office
facilities and supplies, and noncomputerized records. For example, an
analysis should be performed to identify the maximum number of disk
drives needed at one time and the specific requirements for
telecommunications lines and devices.
Because essential resources are likely to be held or managed by a
variety of groups within an entity, it is important that program and
information security support staff work together to identify the
resources needed for critical operations.
CP-1.3. Emergency processing priorities are established:
In conjunction with identifying and ranking critical functions, the
entity should develop a plan for restoring critical operations. The
plan should clearly identify the order in which various aspects of
processing should be restored, who is responsible, and what supporting
equipment or other resources will be needed. A carefully developed
processing restoration plan can help employees immediately begin the
restoration process and make the most efficient use of limited computer
resources during an emergency. Both system users and information
security support staff should be involved in determining emergency
processing priorities. (See critical element CP-3 for additional
information on contingency planning.)
Control Techniques and Suggested Audit Procedures for Critical Element
CP-1:
Table 33. Control Techniques and Suggested Audit Procedures for
Critical Element CP-1: Assess the criticality and sensitivity of
computerized operations and identify supporting resources:
Control activities:
CP-1.1. Critical data and operations are identified and prioritized.
Control techniques:
CP-1.1.1. The entity categorizes information systems in accordance with
appropriate guidance, such as FIPS 199, and documents the results in
the system security plan. CP-1.1.2 A list of critical operations and
data has been documented that:
* identifies primary mission or business functions,
* prioritizes data and operations,
* is approved by senior program managers, and;
* reflects current conditions including system interdependencies and
technologies.
Audit procedures:
Review the policies and methodology used to categorize systems and
create the critical operations list. This list should identify each
system and its criticality in supporting the agency�s primary mission
or business functions. Review how systems are categorized and the
critical operations list. Determine if the justifications have been
documented and that they (1) prioritize data and operations by primary
mission or business functions; (2) are approved by senior management;
and (3) reflect current operating conditions, including key system
interdependencies. Determine if technology supporting critical
operations is identified and appropriately considered in processing
priorities. Interview program, information technology, and security
administration officials. Determine their input and assessment of the
reasonableness of priorities established.
Control activities:
CP-1.2. Resources supporting critical operations are identified and
analyzed.
Control techniques:
CP-1.2.1. Resources supporting critical operations and functions have
been identified and documented. Types of resources identified should
include:
* computer hardware,
* computer software,
* computer supplies,
* network components,
* system documentation,
* telecommunications,
* office facilities and supplies, and;
* human resources.
Audit procedures:
Interview program and security administration officials responsible for
developing the critical operations listing. Review documentation
supporting the critical operations listing to verify that the following
resources have been identified for each critical operation:
* computer hardware and software,
* computer supplies,
* network components,
* system documentation,
* telecommunications,
* office facilities and supplies, and,
* human resources. Appropriate documentation may include contingency-
related plans in NIST SP 800-34.
Control activities:
CP-1.2. Resources supporting critical operations are identified and
analyzed.
Control techniques:
CP-1.2.2. Critical information technology resources have been analyzed
to determine their impact on operations if a given resource were
disrupted or damaged. This analysis should evaluate the impact of the
outages over time and across related resources and dependent systems.
Audit procedures:
Determine if a current business impact analysis has been conducted that
identifies critical information technology resources, disruption
impacts, allowed outage times, and recovery priorities.
Control activities:
CP-1.3. Emergency processing priorities are established.
Control techniques:
CP-1.3.1. Emergency processing priorities have been documented and
approved by appropriate program and data processing managers.
Audit procedures:
Review related policies, plans, and procedures for emergency processing
and ensure:
* recovery priorities have been developed,
* management has approved priorities, and,
* priorities are documented. Request a copy of the continuity of
operations plan. Interview program and security administration
officials to determine whether they are aware of all policies and
procedures for emergency processing priorities and maintain copies of
the continuity of operations plan.
Source: GAO.
[End of table]
Critical Element CP-2. Take steps to prevent and minimize potential
damage and interruption:
There are a number of steps that an entity should take to prevent or
minimize the damage to automated operations that can occur from
unexpected events. These can be categorized as:
* routinely duplicating or backing up data files, computer programs,
and critical documents with off-site storage;
* arranging for remote backup facilities that can be used if the
agency�s usual facilities are damaged beyond use;
* establishing an information system recovery and reconstitution
capability so that the information system can be recovered and
reconstituted to its original state after a disruption or failure;
* installing environmental controls, such as fire-suppression systems
or backup power supplies; and;
* ensuring that staff and other system users understand their
responsibilities during emergencies.
Such steps, especially implementing thorough backup procedures and
installing environmental controls, are generally inexpensive ways to
prevent relatively minor problems from becoming costly disasters. In
particular, an entity should maintain an ability to restore data files,
which may be impossible to recreate if lost. In addition, effective
maintenance, problem management, and change management for hardware
equipment will help prevent unexpected interruptions.
In an IS controls audit being performed as part of a financial audit or
data reliability assessment, the auditor should tailor the
identification of control techniques and audit procedures related to
environmental controls (CP-2.2) and hardware maintenance (CP-2.4) to
achieve the audit objectives, considering the IS controls identified by
the auditor as significant to the audit objectives (e.g., internal
control over financial reporting).
CP-2.1. Data and program backup procedures have been implemented:
Routinely copying data files and software and storing these files at a
secure, remote location are usually the most cost-effective actions
that an entity can take to mitigate service interruptions. Although
equipment can often be readily replaced, the cost could be significant
and reconstructing computerized data files and replacing software can
be extremely costly and time consuming. And, data files cannot always
be reconstructed. In addition to the direct costs of reconstructing
files and obtaining software, the related service interruptions could
lead to significant financial losses.
A program should be in place for regularly backing up computer files,
including master files, transaction files, application programs, system
software, and database software, and for storing these backup copies
securely at an off-site location. Choosing a location depends on the
particular needs of the entity, but in general, the location should be
far enough away from the primary location that it will be protected
from events such as fires, storms, electrical power outages, and
terrorism that may occur to the primary location. In addition, it
should be protected from unauthorized access and from environmental
hazards.
The frequency with which files should be backed up depends on the
volume and timing of transactions that modify the data files.
Generally, backing up files on a daily basis is adequate. However, if a
system accounts for thousands of transactions per day, it may be
appropriate to back up files several times a day. Conversely, if only a
few transactions are recorded every week, then weekly backing up of
files may be adequate.
File back up procedures should be designed so that a recent copy is
always available. For example, new data file versions should be
received at the off-site storage location before the disks or tapes
containing prior versions are returned to the data center for reuse.
Generally, data center personnel are responsible for routinely backing
up files. However, if critical data are routinely maintained on
computers that are not under the control of data center personnel, then
responsibility for backing up this information should be clearly
defined.
In addition to data files and software programs, copies of any other
information and supplies that may be needed to maintain operations
should be maintained at a remote location. Examples of such documents
are system and application documentation, unique preprinted computer
paper, and essential legal files. Although a review of computer-related
controls focuses on electronically maintained data, it is important
that critical paper documents also be copied and stored remotely so
that they are available when needed to support automated operations.
CP-2.2. Adequate environmental controls have been implemented:
Environmental controls prevent or mitigate potential damage to
facilities and interruptions in service. Examples of environmental
controls include:
* fire extinguishers and fire-suppression systems;
* fire alarms;
* smoke detectors;
* water detectors;
* emergency lighting;
* redundancy in air cooling systems;
* backup power supplies;
* existence of shut-off valves and procedures for any building plumbing
lines that may endanger processing facilities;
* processing facilities built with fire-resistant materials and
designed to reduce the spread of fire; and;
* policies prohibiting eating, drinking, and smoking within computer
facilities.
Environmental controls can diminish the losses from some interruptions
such as fires or prevent incidents by detecting potential problems
early, such as water leaks or smoke, so that they can be remedied.
Also, uninterruptible or backup power supplies can carry a facility
through a short power outage or provide time to back up data and
perform orderly shut-down procedures during extended power outages.
CP-2.3. Staff have been trained to respond to emergencies:
Staff should be trained in and aware of their responsibilities in
preventing, mitigating, and responding to emergency situations. For
example, information security support staff should receive periodic
training in emergency fire, water, and alarm incident procedures, as
well as in their responsibilities in starting up and running an
alternate data processing site. Also, if outside users are critical to
the agency�s operations, they should be informed of the steps they may
have to take as a result of an emergency.
Generally, information on emergency procedures and responsibilities can
be provided through training sessions and by distributing written
policies and procedures. Training sessions should be held at least once
a year and whenever changes to emergency plans are made. Further, if
staff could be required to relocate or significantly alter their
commuting routine in order to operate an alternate site in an
emergency, it is advisable for an entity to incorporate into the
contingency plan steps for arranging lodging and meals or any other
facilities or services that may be needed to accommodate essential
personnel.
CP-2.4. Effective hardware maintenance, problem management, and change
management help prevent unexpected interruptions:
Unexpected service interruptions can occur from hardware equipment
failures or from changing equipment without adequate advance
notification to system users. To prevent such occurrences requires an
effective program for maintenance, problem management, and change
management for hardware equipment.
Routine periodic hardware maintenance should be scheduled and performed
to help reduce the possibility and impact of equipment failures. Vendor-
supplied specifications normally prescribe the frequency and type of
preventive maintenance to be performed. Such maintenance should be
scheduled in a manner to minimize the impact on overall operations and
on critical or sensitive applications. Specifically, peak workload
periods should be avoided. All maintenance performed should be
documented, especially any unscheduled maintenance that could be
analyzed to identify problem areas warranting additional action for a
more permanent solution. Flexibility should be designed into the data
processing operations to accommodate the required preventive
maintenance and reasonably expected unscheduled maintenance. For
critical or sensitive applications that require a high level of system
availability, the acquisition and use of spare or backup hardware may
be appropriate.
Effective problem management requires tracking service performance and
documenting problems encountered. Goals should be established by senior
management on the availability of data processing and on-line service.
Records should be maintained on the actual performance in meeting
service schedules. Problems and delays encountered, the reasons for the
problems or delays, and the elapsed time for resolution should be
recorded and analyzed to identify any recurring pattern or trend.
Senior management should periodically review and compare the service
performance achieved with the goals and survey user departments to see
if users� needs are being met.
Changes to hardware equipment and related software should be scheduled
to minimize the impact on operations and users and allow for adequate
testing to demonstrate that they will work as expected. Advance
notification should be given to users so that service is not
unexpectedly interrupted.
CP-2 Related NIST SP-800-53 Controls:
CP-3 Contingency Training;
CP-6 Alternative Storage Site;
CP-7 Alternate Processing Site;
CP-9 Information System Backup;
CP-10 Information System Recovery and Reconstitution;
MA-2 Controlled Maintenance;
MA-3 Maintenance Tools;
MA-5 Maintenance Personnel;
MA-6 Timely Maintenance;
PE-9 Power Equipment and Power Cabling;
PE-10 Emergency Shutoff;
PE-11 Emergency Power;
PE-12 Emergency Lighting;
PE-13 Fire Protection;
PE-14 Temperature and Humidity Controls;
PE-15 Water Damage Protection;
PE-16 Delivery and Removal;
PE-17 Alternate Work Site;
PE-18 Location of Information System Components;
SA-5 Information System Documentation.
Control Techniques and Suggested Audit Procedures for Critical Element
CP-2:
Table 34. Control Techniques and Suggested Audit Procedures for
Critical Element CP-2: Take steps to prevent and minimize potential
damage and interruption:
Control activities:
CP-2.1. Information system back up and recovery procedures have been
implemented.
Control techniques:
CP-2.1.1. Backup files are created on a prescribed basis and rotated
off-site often enough to avoid disruption if current files are lost or
damaged.
Audit procedures:
Review written policies and procedures for backing up and transporting
files. Determine how often files are backed up and rotated off site,
retention periods, and security involved in transport. Compare
inventory records with the files maintained off-site and determine the
age of these files. For a selection of critical files, locate and
examine the backup files. Verify that backup files can be used to
recreate current reports. Determine whether backup files are created
and rotated off-site as prescribed and are sent before prior versions
are returned. Determine if the technology is implemented in such a
manner as to provide appropriate availability, including consideration
of backup procedures, system configuration, redundancy, environmental
controls, staff training, and routine maintenance.
Control activities:
CP-2.1. Information system back up and recovery procedures have been
implemented.
Control techniques:
CP-2.1.2. System and application documentation is maintained at the off-
site storage location.
Audit procedures:
Locate and examine documentation.
Control activities:
CP-2.1. Information system back up and recovery procedures have been
implemented.
Control techniques:
CP-2.1.3. The backup storage site is:
* geographically removed from the primary site (for example, not
subject to the same hazards), and,
* protected by environmental controls and physical access controls.
Audit procedures:
Examine the backup storage site. Determine if there are accessibility
problems between the storage and processing sites in the event of an
area wide disaster.
Control activities:
CP-2.1. Information system back up and recovery procedures have been
implemented.
Control techniques:
CP-2.1.4. The information system back up and recovery procedures
adequately provide for recovery and reconstitution to the system�s
original state after a disruption or failure including:
* system parameters are reset;
* patches are reinstalled;
* configuration settings are reestablished;
* system documentation and operating procedures are available;
* application and system software is reinstalled;
* information from the most recent backup is available; and;
* the system is fully tested.
Audit procedures:
Interview entity officials and determine whether comprehensive
procedures and mechanisms exist to fully restore the information
security to its original state. Determine if this recovery capability
has been tested and, if so, review the test plan and test results.
Control activities:
CP-2.2. Adequate environmental controls have been implemented.
Audit procedures:
These procedures should be performed in conjunction with Section AC-6
regarding physical access controls.
Control activities:
CP-2.2. Adequate environmental controls have been implemented.
Control techniques:
CP-2.2.1. Fire detection and suppression devices have been installed
and are working, for example, smoke detectors, fire extinguishers, and
sprinkler systems.
CP-2.2.2. Controls have been implemented to mitigate other disasters,
such as floods, earthquakes, terrorism, etc.
CP-2.2.3. Redundancy exists in critical systems (for example, power and
air cooling systems)
CP-2.2.4. Building plumbing lines do not endanger the computer facility
or, at a minimum, shut-off valves and procedures exist and are known.
CP-2.2.5. An uninterruptible power supply or backup generator has been
provided so that power will be adequate for orderly shut down.
CP-2.2.6. Humidity, temperature, and voltage are controlled within
acceptable levels.
CP-2.2.7. Emergency lighting activates in the event of a power outage
and covers emergency exits and evacuation routes.
CP-2.2.8. A master power switch or emergency shut-off switch is present
and appropriately located.
Audit procedures:
Examine the agency�s facilities. Interview site managers. Observe that
operations staff are aware of the locations of fire alarms, fire
extinguishers, regular and auxiliary electrical power switches, water
shut-off valves, breathing apparatus, and other devices that they may
be expected to use in an emergency. Also, observe that emergency
lighting works and that power and other cabling is protected. Observe
the operation, location, maintenance, and access to the air cooling
systems. Determine whether humidity, temperature, and voltage are
appropriately controlled. Observe whether water can enter through the
computer room ceiling or whether pipes are running through the facility
and that there are water detectors on the floor. Determine whether the
activation of heat and smoke detectors will notify the fire department.
Control activities:
CP-2.2. Adequate environmental controls have been implemented.
Control techniques:
CP-2.2.9. Environmental controls are periodically tested at least
annually for federal agencies Review test policies.
Audit procedures:
Review documentation supporting recent tests of environmental controls.
Control activities:
CP-2.2. Adequate environmental controls have been implemented.
Control techniques:
CP-2.2.10. Eating, drinking, and other behavior that may damage
computer equipment is prohibited.
Audit procedures:
Review policies and procedures regarding employee behavior. Observe
employee behavior.
Control activities:
CP-2.3. Staff have been trained to respond to emergencies.
Control techniques:
CP-2.3.1. Operational and support personnel have received training and
understand their emergency roles and responsibilities.
Audit procedures:
Interview security personnel and appropriate operational and support
staff and ensure that they understand their roles and responsibilities.
Control activities:
CP-2.3. Staff have been trained to respond to emergencies.
Control techniques:
CP-2.3.2. Personnel receive periodic environmental controls training
including emergency fire, water, and alarm incident procedures.
Audit procedures:
Review training records and training course documentation. Determine
whether all personnel have received up-to-date training and that the
scope of the training is adequate.
Control activities:
CP-2.3. Staff have been trained to respond to emergencies.
Control techniques:
CP-2.3.3. Emergency response procedures are documented.
Audit procedures:
Review emergency response procedures for completeness and determine
whether roles and responsibilities are clearly defined.
Control activities:
CP-2.3. Staff have been trained to respond to emergencies.
Control techniques:
CP-2.3.4. Emergency procedures are periodically tested. Review test
policies.
Audit procedures:
Review test documentation. Interview operational and data center staff.
Control activities:
CP-2.4. Effective hardware maintenance, problem management, and change
management help prevent unexpected interruptions.
Control techniques:
CP-2.4.1. Policies and procedures exist and are up-to-date.
Audit procedures:
Review policies and procedures.
Control activities:
CP-2.4. Effective hardware maintenance, problem management, and change
management help prevent unexpected interruptions.
Control techniques:
CP-2.4.2. Routine periodic hardware preventive maintenance is scheduled
and performed in accordance with vendor specifications and in a manner
that minimizes the impact on operations.
CP-2.4.3. Regular and unscheduled maintenance performed is documented.
CP-2.4.4. Flexibility exists in the data processing operations to
accommodate regular and a reasonable amount of unscheduled maintenance.
Audit procedures:
Interview information security, data processing, and user management.
Review maintenance documentation. Determine when maintenance is
performed, if it is in accordance with vendor specifications, and if
there is minimal impact on system availability.
Control activities:
CP-2.4. Effective hardware maintenance, problem management, and change
management help prevent unexpected interruptions.
Control techniques:
CP-2.4.5. Spare or backup hardware is used to provide a high level of
system availability for critical and sensitive applications.
Audit procedures:
Interview information security and data center management.
Control activities:
CP-2.4. Effective hardware maintenance, problem management, and change
management help prevent unexpected interruptions.
Control techniques:
CP-2.4.6. Goals are established by senior management on the
availability of data processing and on-line services.
CP-2.4.7. Records are maintained on the actual performance in meeting
service schedules.
CP-2.4.8. Problems and delays encountered, the reason, and the elapsed
time for resolution are recorded and analyzed to identify recurring
patterns or trends.
Audit procedures:
Interview senior management, information security management, data
processing management, and user management. Review supporting
documentation, including system performance metrics.
Control activities:
CP-2.4. Effective hardware maintenance, problem management, and change
management help prevent unexpected interruptions.
Control techniques:
CP-2.4.9. Senior management periodically reviews and compares the
service performance achieved with the goals and surveys of user
departments to see if their needs are being met.
CP-2.4.10. Changes of hardware equipment and related software are
scheduled to minimize the impact on operations and users, thus allowing
for adequate testing.
CP-2.4.11. Advance notification of hardware changes is given to users
so that service is not unexpectedly interrupted.
Audit procedures:
Interview senior management, information security management, data
processing management, and user management. Review supporting
documentation such as user surveys, service goals, metrics measuring
system availability, service schedules, and test plans.
Source: GAO.
[End of table]
Critical Element CP-3. Develop and document a comprehensive contingency
plan:
A contingency plan or suite of related plans should be developed for
restoring critical applications; this includes arrangements for
alternative processing facilities in case the usual facilities are
significantly damaged or cannot be accessed. Agency/entity-level
policies and procedures define the contingency planning process and
documentation requirements. Furthermore, an entitywide plan should
identify critical systems, applications, and any subordinate or related
plans. It is important that these plans be clearly documented,
communicated to affected staff, and updated to reflect current
operations. Testing the plan is addressed in critical element CP-4. In
addition, the plan should address entity systems maintained by a
contractor or other entity (e.g., through service level agreements).
According to NIST, contingency planning represents a broad scope of
activities designed to sustain and recover critical IT services
following an emergency. IT contingency planning fits into a much
broader emergency preparedness environment that includes organizational
and business process continuity and recovery planning. Ultimately, an
organization may use a suite of plans to properly prepare response,
recovery, and continuity activities for disruptions affecting the
organization�s IT systems, business processes, and the facility.
Because there is an inherent relationship between an IT system and the
business process it supports, there should be coordination between each
plan during development and updates to ensure that recovery strategies
and supporting resources neither negate each other nor duplicate
efforts.
The NIST SP 800-34, Contingency Planning Guide for Information
Technology Systems, discusses the types of contingency plans that an
organization might use and how they relate to each other. Since there
is no standard definition for these plans, they may vary from
organization to organization. To provide a common basis of
understanding for IT contingency planning, NIST developed the
descriptions shown in the table below.
Table 35: Types of Contingency-Related Plans:
Plan: Business Continuity Plan (BCP);
Purpose: Provide procedures for sustaining essential business
operations while recovering from a significant disruption;
Scope: Addresses business processes; IT addressed based only on its
support for business process.
Plan: Business Recovery (or Resumption) Plan (BRP);
Purpose: Provide procedures for recovering business operations
immediately following a disaster;
Scope: Addresses business processes; not IT-focused; IT addressed based
only on its support for business process.
Plan: Continuity of Operations Plan (COOP);
Purpose: Provide procedures and capabilities to sustain an
organization�s essential, strategic functions at an alternate site for
up to 30 days;
Scope: Addresses the subset of an organization�s missions that are
deemed most critical; usually written at headquarters level; not IT-
focused.
Plan: Continuity of Support Plan/IT Contingency Plan;
Purpose: Provide procedures and capabilities for recovering a major
application or general support system;
Scope: Same as IT contingency plan; addresses IT system disruptions;
not business process focused.
Plan: Crisis Communications Plan;
Purpose: Provides procedures for disseminating status reports to
personnel and the public;
Scope: Addresses communications with personnel and the public; not IT
focused.
Plan: Cyber Incident Response Plan;
Purpose: Provide strategies to detect, respond to, and limit
consequences of malicious cyber incident;
Scope: Focuses on information security responses to incidents affecting
systems and/or networks.
Plan: Disaster Recovery Plan (DRP);
Purpose: Provide detailed procedures to facilitate recovery of
capabilities at an alternate site;
Scope: Often IT-focused; limited to major disruptions with long-term
effects.
Plan: Occupant Emergency Plan (OEP);
Purpose: Provide coordinated procedures for minimizing loss of life or
injury and protecting property damage in response to a physical threat;
Scope: Focuses on personnel and property particular to the specific
facility; not business process or IT system functionality based.
Source: NIST Contingency Planning Guide for Information Technology
Systems (SP 800-34).
[End of table]
In addition, NIST addresses technical contingency planning
considerations and solutions for specific information technology
platforms: (1) desktop computers and portable systems, (2) servers, (3)
Web sites, (4) local area networks, (5) wide area networks, (6)
distributed systems, and (7) mainframe systems.
Note that incident handling can be considered that portion of
contingency planning that responds to malicious technical threats. An
incident response capability is addressed in critical element AC-5.1.
CP-3.1. An up-to-date contingency plan is documented:
Contingency plans should be documented, agreed on by both users and
information security departments, and communicated to affected staff.
FISMA requires that each federal agency develop, document, and
implement an agencywide information security program that includes
plans to ensure continuity of operations for information systems.
The plan should reflect the risks and operational priorities that the
entity has identified. It should be designed so that the costs of
contingency planning do not exceed the costs associated with the risks
that the plan is intended to reduce. The plan should also be detailed
enough so that its success does not depend on the knowledge or
expertise of one or two individuals. It should identify and provide
information on:
* supporting resources that will be needed;
* roles and responsibilities of those who will be involved in recovery
activities;
* arrangements for an off-site disaster recovery location and travel
and lodging for necessary personnel, if needed;
* off-site storage location for backup files; and;
* procedures for restoring critical applications and their order in the
restoration process. (See section CP-1.3 for additional information on
emergency processing priorities.)
Multiple copies of the contingency plan should be available, with some
stored at off-site locations to make sure they are not destroyed by the
same events that made the primary data processing facilities
unavailable.
CP-3.2. Arrangements have been made for alternate data processing,
storage, and telecommunications facilities:
Depending on the degree of service continuity needed, choices for
alternative facilities will range from an equipped site ready for
immediate backup service, referred to as a �hot site,� to an unequipped
site that will take some time to prepare for operations, referred to as
a �cold site.� In addition, various types of services can be
prearranged with vendors. These include making arrangements with
suppliers of computer hardware and telecommunications services as well
as with suppliers of business forms and other office supplies.
As with all emergency preparations, costs and risks should be
considered in deciding what type of alternate site is needed. However,
it should be geographically removed from the original site so that it
is protected from the same events. In addition, the site should have
ready access to the basic utilities needed to resume operations, such
as electricity, water, and telecommunications services. In some cases,
two or more entities may share the same alternate site in order to
reduce the cost. However, this may cause problems if two or more
entities need the site at the same time.
Whatever options are determined to be the most appropriate, the entity
should have a formal agreement or contract detailing the emergency
arrangements. Further, the arrangements should be periodically reviewed
to determine whether they remain adequate to meet the agency�s needs.
CP-3 Related NIST SP-800-53 Controls:
CP-2 Contingency Plan;
CP-5 Contingency Plan Update;
CP-8 Telecommunications Services.
Control Techniques and Suggested Audit Procedures for Critical Element
CP-3:
Table 36. Control Techniques and Suggested Audit Procedures for
Critical Element CP-3: Develop and document a comprehensive contingency
plan:
Control activities:
CP-3.1. An up-to-date contingency plan is documented.
Control techniques:
CP-3.1.1. A contingency plan has been documented that:
* is based on clearly defined contingency planning policy;
* reflects current conditions, including system interdependencies;
* has been approved by key affected groups, including senior
management, information security and data center management, and
program managers;
* clearly assigns responsibilities for recovery;
* includes detailed instructions for restoring operations (both
operating system and critical applications);
* identifies the alternate processing facility and the back up storage
facility;
* includes procedures to follow when the data/service center is unable
to receive or transmit data;
* identifies critical data files;
* is detailed enough to be understood by all entity managers;
* includes computer and telecommunications hardware compatible with the
agency�s needs;
* includes necessary contact numbers;
* includes appropriate system-recovery instructions;
* has been distributed to all appropriate personnel; and;
* has been coordinated with related plans and activities.
Audit procedures:
Review contingency planning policy and determine if it documents the
agency�s overall contingency objectives and establishes the
organizational framework and responsibilities for contingency planning.
Obtain contingency plans (see NIST SP 800-34) and compare their
provisions with the most recent risk assessment and with a current
description of automated operations. Compare the contingency plans to
security-related plans, facility-level plans, and agency/entity-level
plans such as those in NIST contingency planning guidance. Determine if
the contingency plans include:
* appropriate consideration of the technology, including alternative
processing requirements,
* recovery of the security infrastructure, and,
* interdependencies with other systems (i.e., other component, federal,
state, or local agencies) that could affect the contingency operations.
Control activities:
CP-3.1. An up-to-date contingency plan is documented.
Control techniques:
CP-3.1.2. Contingency plans are reevaluated before proposed changes to
the information system are approved to determine if major modifications
have security ramifications that require operational changes in order
to maintain adequate risk mitigation.
Audit procedures:
Interview senior management, information security management, and
program managers.
Control activities:
CP-3.1. An up-to-date contingency plan is documented.
Control techniques:
CP-3.1.3. Procedures allow facility access in support of restoration of
lost information under the contingency plans in the event of an
emergency.
Audit procedures:
Determine whether emergency and temporary access authorizations are
properly approved, documented, controlled, communicated, and
automatically terminated after a predetermined period. These procedures
should be performed in conjunction with Section AC-3.1.8 and AC-6.1.8
regarding access controls.
Control activities:
CP-3.1. An up-to-date contingency plan is documented.
Control techniques:
CP-3.1.4. The plan provides for backup personnel so that it can be
implemented independent of specific individuals.
Audit procedures:
Review the contingency plan.
Control activities:
CP-3.1. An up-to-date contingency plan is documented.
Control techniques:
CP-3.1.5. User departments have developed adequate manual/peripheral
processing procedures for use until operations are restored.
Audit procedures:
Interview senior management, information security management, and
program managers.
Control activities:
CP-3.1. An up-to-date contingency plan is documented.
Control techniques:
CP-3.1.6. Several copies of the current contingency plan are securely
stored off-site at different locations.
Audit procedures:
Observe copies of the contingency and related plans held off-site.
Control activities:
CP-3.1. An up-to-date contingency plan is documented.
Control techniques:
CP-3.1.7. The contingency plan is periodically reassessed and revised
as appropriate. At a minimum, the plan is reassessed when there are
significant changes in entity mission, organization, business
processes, and IT infrastructure (e.g. hardware, software, personnel).
Audit procedures:
Review the plan and any documentation supporting recent plan
reassessments.
Control activities:
CP-3.2. Arrangements have been made for alternate data processing,
storage, and telecommunications facilities.
Control techniques:
CP-3.2.1. Contracts or interagency agreements have been established for
backup processing facilities that:
* are in a state of readiness commensurate with the risks of
interrupted operations,
* have sufficient processing and storage capacity, and,
* are likely to be available for use.
Audit procedures:
Interview officials and review contracts and agreements including
processing priorities for the backup site. Determine if the back up
site is properly configured and ready to be used as an operational
site.
Control activities:
CP-3.2. Arrangements have been made for alternate data processing,
storage, and telecommunications facilities.
Control techniques:
CP-3.2.2. Alternate network and telecommunication services have been
arranged.
Audit procedures:
Interview officials and review contracts and agreements including the
priority of service provisions for the backup service provider.
Determine if the backup service provides separate failure points and is
geographically removed from the primary provider.
Control activities:
CP-3.2. Arrangements have been made for alternate data processing,
storage, and telecommunications facilities.
Control techniques:
CP-3.2.3. Arrangements are planned for travel, lodging, and protection
of necessary personnel, if needed.
Audit procedures:
Interview officials and review the plan.
Source: GAO.
[End of table]
Critical Element CP-4. Periodically test the contingency plan and
adjust it as appropriate:
Testing contingency plans is essential to determining whether they will
function as intended in an emergency situation. According to OMB,
federal managers have reported that testing revealed important
weaknesses in their plans, such as backup facilities that could not
adequately replicate critical operations as anticipated. Through the
testing process, these plans were substantially improved.[Footnote 88]
The most useful scenarios involve simulating a disaster situation to
test overall service continuity. Such an event would include testing
whether the alternative data processing site will function as intended
and whether critical computer data and programs recovered from off-site
storage are accessible and current. In executing the plan, managers
will be able to identify weaknesses and make changes accordingly.
Moreover, tests will assess how well employees have been trained to
carry out their roles and responsibilities in a disaster situation.
CP-4.1. The plan is periodically tested:
The frequency of contingency plan testing will vary depending on the
criticality of the agency�s operations. Generally, contingency plans
for very critical functions should be fully tested about once every
year or two, whenever significant changes to the plan have been made,
or when significant turnover of key people has occurred. It is
important for top management to assess the risks of contingency plan
problems and develop and document a policy on the frequency and extent
of such testing.
CP-4.2. Test results are analyzed and the contingency plan is adjusted
accordingly:
Contingency test results provide an important measure of the
feasibility of the contingency plan. As such, they should be reported
to top management so that the need for modification and additional
testing can be determined and so that top management is aware of the
risks of continuing operations with an inadequate contingency plan. Any
testing of contingency plans is likely to identify weaknesses in the
plan, and it is important that the plan and related supporting
activities, such as training, be revised to address these weaknesses.
Otherwise, the benefits of the testing will be mostly lost.
Control Techniques and Suggested Audit Procedures for Critical Element
CP-4:
CP-4 Related NIST SP-800-53 Controls:
CP-4 Contingency Plan Testing and Exercises;
CP-5 Contingency Plan Update.
Table 37. Control Techniques and Suggested Audit Procedures for
Critical Element CP-4: Periodically test the contingency plan and
adjust it as appropriate:
Control activities:
CP-4.1. The plan is periodically tested.
Control techniques:
CP-4.1.1. The contingency plan is periodically tested under conditions
that simulate a disaster. Disaster scenarios tested may be rotated
periodically. Typically, contingency plans are tested annually or as
soon as possible after a significant change to the environment that
would alter the assessed risk.
Audit procedures:
Review testing policies and methodology used to select disaster
scenarios. Determine when and how often contingency plans are tested.
Determine if technology is appropriately considered in periodic tests
of the contingency plan and resulting adjustments to the plan. Review
test results. Observe a disaster recovery test.
Control activities:
CP-4.2. Test results are analyzed and the contingency plan is adjusted
accordingly.
Control techniques:
CP-4.2.1. Test results are documented and a report, such as a lessons
learned report, is developed and provided to senior management. Review
final test report.
Audit procedures:
Interview senior managers to determine if they are aware of the test
results.
Control activities:
CP-4.2. Test results are analyzed and the contingency plan is adjusted
accordingly.
Control techniques:
CP-4.2.2. The contingency plan and related agreements and preparations
are adjusted to correct any deficiencies identified during testing.
Audit procedures:
Review any documentation supporting contingency plan adjustments.
Source: GAO.
[End of table]
[End of chapter]
Chapter 4. Evaluating and Testing Business Process Application
Controls:
4.0 Overview:
Business processes are the principal functions used by the entity to
accomplish its mission. Examples of typical business processes in
government entities include:
* Mission-related processes, typically at the program or sub-program
level, such as education, public health, law enforcement, or income
security;
* Financial management processes, such as collections, disbursements,
or payroll; and;
* Other support processes, such as human resources, or property
management, and security.
A business process application is a combination of hardware and
software that is used to process business information in support of a
specific business process.
Business process application level controls, commonly referred to as
�application level controls� or �application controls�, are those
controls over the completeness, accuracy, validity and confidentiality
of transactions and data during application processing. The
effectiveness of application level controls is dependent on the
effectiveness of entitywide and system level general controls.
Weaknesses in entitywide and system level general controls can result
in unauthorized changes to business process applications and data that
can circumvent or impair the effectiveness of application level
controls.
If entitywide and system level controls are relevant to the audit
objectives, the auditor should coordinate the planning and testing of
such controls with application level controls. For example, if a data
management system is a critical control point, the auditor would
coordinate the planning of testing of the entitywide, system, and
application level controls associated with the data management system.
In this chapter, application level controls are divided into the
following four control categories, which are described in more detail
below:
(1) Application level general controls;
(2) Business Process controls;
(3) Interface controls; and
(4) Data Management System controls.
The auditor should assess the effectiveness of controls in each of the
four control categories to the extent they are significant to the audit
objectives.
Application level general controls (referred to herein as �application
security� or AS)consist of general controls operating at the business
process application level, including those related to security
management, access controls, configuration management, segregation of
duties, and contingency planning. In this chapter, the general control
activities discussed in Chapter 3, as well as related suggested control
techniques and audit procedures, are tailored to the business process
application level.
Business Process (BP) controls are the automated and/or manual controls
applied to business transaction flows. They relate to the completeness,
accuracy, validity and confidentiality of transactions and data during
application processing. They typically cover the structure, policies,
and procedures that operate at a detailed business process (cycle or
transaction) level and operate over individual transactions or
activities across business processes. Specific control areas of
business process controls are:
* Transaction Data Input relates to controls over data that enter the
application (e.g., data validation and edit checks).
* Transaction Data Processing relates to controls over data integrity
within the application (e.g., review of transaction processing logs).
* Transaction Data Output relates to controls over data output and
distribution (e.g., output reconciliation and review).
* Master Data Setup and Maintenance relates to controls over master
data, the key information that is relatively constant and shared
between multiple functions or applications (e.g., vendor file).
Interface controls (IN)consist of those controls over the a) timely,
accurate, and complete processing of information between applications
and other feeder and receiving systems on an on-going basis, and b)
complete and accurate migration of clean data during conversion.
Data management system (DA) controls are relevant to most business
process applications because applications frequently utilize the
features of a data management system to enter, store, retrieve or
process information, including detailed, sensitive information such as
financial transactions, customer names, and social security numbers.
Data management systems include database management systems,
specialized data transport/communications software (often called
middleware), data warehouse software, and data extraction/reporting
software. Data management system controls enforce user
authentication/authorization, availability of system privileges, data
access privileges, application processing hosted within the data
management systems, and segregation of duties. Chapter 3 addresses
general controls over data management systems as part of system level
controls. This chapter discusses their use within the application
level.
For each of the four application control categories, this chapter
identifies several critical elements--tasks that are essential for
establishing adequate controls within the category. For each critical
element, there is a discussion of the associated objectives, risks, and
control activities, as well as potential control techniques and
suggested audit procedures. For each critical element, the auditor
should make a summary determination as to the effectiveness of the
entity�s related controls in achieving the critical element. If the
controls for one or more of each category�s critical elements are
ineffective, then the controls for the entire category are not likely
to be effective. The auditor should use professional judgment in making
such determinations.
To facilitate the auditors� evaluation, tables identifying commonly
used control techniques and related suggested audit procedures are
included after the discussion of each critical element. These tables
can be used for both the preliminary evaluation and the more detailed
evaluation and testing of controls. For the preliminary evaluation, the
auditor can use the tables to guide and document preliminary inquiries
and observations. For the more detailed evaluation and testing, the
auditor can use the suggested audit procedures in developing and
carrying out a testing plan. Such a testing plan would include more
extensive inquiries; observation of control procedures; inspection of
application configurations, design documents, policies and written
procedures; and tests of key control techniques, which may include
using audit or system software auditing tools.
The discussion of control elements and control techniques apply to all
application environments, which include mainframe, client-server,
integrated enterprise resource planning (ERP)[Footnote 89] and web
environments. The nature of evidence obtained by the auditor will be
different based on the environment. Auditors� knowledge of the business
processes and application level security in different environments is,
therefore, critical to identifying and testing business process
application level controls.
As noted earlier, the effectiveness of application level controls is
dependent on the effectiveness of entitywide and system level general
controls. Weaknesses in entitywide and system level general controls
can result in unauthorized changes to business process applications and
data (confidentiality, integrity, and availability) that can circumvent
or impair the effectiveness of business process application controls.
More specifically,
* Weaknesses in security management can result in inadequate assessment
of and response to information security risks related to the business
process applications and the systems on which they depend, as well as
significantly increase the risk that application level and other
controls are not consistently applied in accordance with management�s
policies.
* Weaknesses in access controls can result in unauthorized access to
and modifications of;
- applications, including the operation of the related controls,
- application data, including after the control(s) were applied,
and/or,
- system components, which can lead to unauthorized changes to data and
applications.
* Weaknesses in configuration management can result in unauthorized
modifications or additions to the applications and to system
components, leading to unauthorized access to data and applications.
* Weaknesses in segregation of duties can result in unauthorized access
to applications, application data, and/or system components. In
addition, such weaknesses can allow fraudulent transactions and control
overrides to occur.
* Weaknesses in contingency planning can result in unavailability of
applications and/or loss of application data.
The following table illustrates the relationship between business
process application level controls and general controls at the
entitywide and system level.
Table 38. General and Application Control Categories Applicable at
Different Levels of Audit:
General Controls:
Control Categories: Security Management:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Access Controls:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Configuration Management:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Segregation of Duties:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Control Categories: Contingency Planning:
Entitywide/Component Level: Applicable;
System Level, Network: Applicable;
System Level, Operating Systems: Applicable;
System Level, Infrastructure Applications: Applicable;
Business Process Application Level: Applicable.
Business Process Application Controls:
Control Categories: Business Process Controls:
Entitywide/Component Level: Not applicable;
System Level, Network: Not applicable;
System Level, Operating Systems: Not applicable;
System Level, Infrastructure Applications: Not applicable;
Business Process Application Level: Applicable.
Control Categories: Interfaces:
Entitywide/Component Level: Not applicable;
System Level, Network: Not applicable;
System Level, Operating Systems: Not applicable;
System Level, Infrastructure Applications: Not applicable;
Business Process Application Level: Applicable.
Control Categories: Data Management Systems:
Entitywide/Component Level: Not applicable;
System Level, Network: Not applicable;
System Level, Operating Systems: Not applicable;
System Level, Infrastructure Applications: Not applicable;
Business Process Application Level: Applicable.
Source: GAO.
[Ed of table]
4.0.1 The Auditor�s Consideration of Business Process Control
Objectives:
The overall objectives of business process application level controls
are to provide reasonable assurance about the completeness, accuracy,
validity and confidentiality of transactions and data during
application processing. Each specific business process control
technique is designed to achieve one or more of these objectives. The
effectiveness of business process controls depends on whether all of
these overall objectives are achieved. Each objective is described in
more detail below.
Completeness (C) controls should provide reasonable assurance that all
transactions that occurred are input into the system, accepted for
processing, processed once and only once by the system, and properly
included in output. Completeness controls include the following key
elements:
* transactions are completely input,
* valid transactions are accepted by the system,
* duplicate postings are rejected by the system,
* rejected transactions are identified, corrected and re-processed;
and;
* all transactions accepted by the system are processed completely.
The most common completeness controls in applications are batch totals,
sequence checking, matching, duplicate checking, reconciliations,
control totals and exception reporting.
Accuracy (A) controls should provide reasonable assurance that
transactions are properly recorded, with the correct amount/data, and
on a timely basis (in the proper period); key data elements input for
transactions are accurate; and data elements are processed accurately
by applications that produce reliable results; and output is accurate.
Accuracy control techniques include programmed edit checks (e.g.,
validations, reasonableness checks, dependency checks, existence
checks, format checks, mathematical accuracy, range checks, etc.),
batch totals and check digit verification.
Validity (V) controls should provide reasonable assurance (1) that all
recorded transactions actually occurred (are real), relate to the
organization, and were properly approved in accordance with
management�s authorization; and (2) that output contains only valid
data. A transaction is valid when it has been authorized (for example,
buying from a particular supplier) and when the master data relating to
that transaction is reliable (for example, the name, bank account and
other details on that supplier). Validity includes the concept of
authenticity. Examples of validity controls are one-for-one checking
and matching.
Confidentiality (CF) controls should provide reasonable assurance that
application data and reports and other output are protected against
unauthorized access. Examples of confidentiality controls include
restricted physical and logical access to sensitive business process
applications, data files, transactions, and output, and adequate
segregation of duties. Confidentiality also includes restricted access
to data reporting/extraction tools as well as copies or extractions of
data files.
The completeness, accuracy, and validity controls relate to the overall
integrity objective. The availability objective is addressed as part of
application level general controls in AS-5.
4.0.2 Steps in Assessing Business Process Application Level Controls:
The assessment of business process application level controls is
incorporated into the audit approach discussed in Chapter 2. This
section provides supplemental implementation guidance with respect to
planning the assessment of business process application level controls
and should be applied in conjunction with Chapter 2. Consistent with
Chapter 2, the assessment of business process application level
controls includes the following steps:
* Plan the information system controls audit;
* Perform information system controls audit tests;
* Report audit results.
4.0.3 Plan the Information System Controls Audit of Business Process
Application Level Controls:
Although planning continues throughout the audit, the objectives of the
initial planning phase are to identify significant issues, assess risk,
and design efficient and effective audit procedures. To accomplish
this, the auditor performs the following steps, which are discussed in
more detail in Chapter 2:
* Understand the overall audit objectives and related scope of the
business process application control assessment;
* Understand the entity�s operations and key business processes;
* Obtain a general understanding of the structure of the entity�s
networks;
* Identify key areas of audit interest (files, applications, systems,
locations);
* Assess information system risk on a preliminary basis;
* Identify critical control points;
* Obtain a preliminary understanding of business process application
level controls;
* Perform other audit planning procedures The following discussion
provides additional audit considerations for certain of these steps, as
they apply to application level controls.
4.0.3.A Understand the overall audit objectives and related scope of
the business process application control assessment:
The auditor should obtain an understanding of the objectives of the
application control assessment. The nature, timing and extent of the
auditor�s procedures to assess the effectiveness of application
controls vary depending upon the audit objectives.
The audit objectives for an application control assessment could
include:
* Assessment as part of a broad assessment of information system
controls (including entitywide, system, and application level
controls), either as part of a financial statement or performance
audit, or as a standalone assessment;
* A comprehensive assessment of application level controls related to a
specific application or applications, with or without an assessment of
related entitywide and system level controls;
* An assessment of specific aspects of application level controls, such
as:
a. Evaluating the efficiency of business process applications;
b. Assessing business process application level controls for
applications under development;
c. Assessing selected business application level control categories,
such as business process controls or application level general
controls;
d. Assessing conversion of data to a new application; or,
e. Assessing access controls to assess whether access granted is
appropriately identified, evaluated, and approved.
As noted in Chapter 2, if achieving the audit objectives does not
require an overall conclusion on IS controls or relates only to certain
components or a subset of controls, the auditor�s assessment would not
necessarily identify all significant IS control weaknesses that may
exist. Consequently, if the audit objectives only relate to a subset of
controls, such as only business process controls for a specific
application, the auditor should evaluate the potential limitations of
the auditor�s work on the auditor�s report and the needs and
expectations of users. The auditor may determine that, because the
limitations are so significant, the auditor will (1) communicate the
limitations to the management of the audited entity, those charged with
governance, and/or those requesting the audit, and (2) clearly report
such limitations on the conclusions in the audit report. For example,
in reporting on an audit limited to business process controls within a
business process application, the auditor may determine that it is
appropriate to clearly report that the scope of the assessment was
limited to those business process controls and that, consequently,
additional information system control weaknesses may exist that could
impact the effectiveness of IS controls related to the application and
to the entity as a whole.
4.0.3.B Understand the entity�s operations and key business processes:
Understanding the entity's operations and business processes includes
understanding how business process applications are used to support key
business processes, as it tends to vary from entity to entity. The
auditor should obtain and review documentation, such as design
documents, blueprints, business process procedures, user manuals, etc.,
and inquire of knowledgeable personnel to obtain a general
understanding of each significant business process application that is
relevant to the audit objectives. This includes a detailed
understanding of:
* business rules (e.g. removing all transactions that fail edits or
only selected ones based on established criteria),
* transaction flows (detailed study of the entity�s internal controls
over a particular category of events that identifies all key procedures
and controls relating to the processing of transactions), and,
* application and software module interaction (transactions leave one
system for processing by another, e.g. payroll time card interfaces
with pay rate file to determine salary information).
Obtaining this understanding is essential to assessing information
system risk, understanding application controls, and developing
relevant audit procedures.
The concept of materiality/significance, discussed in Chapter 2, can
help the auditor determine which applications are significant, or key,
to the audit objectives.
4.0.3.C Obtain a general understanding of the structure of the entity�s
networks:
The auditor should obtain an understanding of the specific networks and
systems that are used to support the key business process applications.
Information obtained during this step is important to:
(1) Assist in the identification of the critical control points (see
Chapter 2) over which entitywide and system level controls need to be
effective for the related application level controls to be effective.
Based on the results of audit procedures, the auditor may modify the
listing of critical control points, or identify additional critical
control points. In the testing phase, the auditor assesses entitywide
and system level controls (as outlined in Chapter 3) over each critical
control point identified, unless not part of the objectives of the
audit.
(2) Provide a foundation for understanding where application level
general controls are applied. For example, application level general
controls may be applied as part of the application itself, through
access control software, data management systems, ERP systems, and/or
in conjunction with operating system and network security. Obtaining
such an understanding is important to identify those controls that are
necessary to reasonably assure that unauthorized access to key
applications and data files are prevented or detected.
4.0.3.D Identify key areas of audit interest (files, applications,
systems, locations):
Based on the audit objectives and the auditor�s understanding of the
business processes and networks, the auditor should identify key areas
of audit interest, including:
* key business process applications and where each key business process
application is processed,
* key data files used by each key business application, and,
* relevant general controls at the entitywide and system levels, upon
which application level controls depend. Chapter 2 provides additional
information on identifying key areas of audit interest.
4.0.3.E Assess information system risk on a preliminary basis:
Based on the auditor�s understanding obtained in the previous steps,
the auditor should assess, on a preliminary basis, the nature and
extent of IS risk related to the key applications. The auditor may
classify security risks according to the definitions explained in
Chapter 2.
Chapter 2 provides a description of risk factors that are relevant to
an assessment of IS risk, including nature of the hardware and software
used, the configuration of the network, and the entity�s IT strategy.
The auditor should evaluate such risk factors in relation to the
specific key business process applications. For example, Internet
accessible applications, and applications that provide access to
assets, such as payment or inventory systems, generally present a
higher degree of risk.
4.0.3.F Identify critical control points:
As discussed in Chapter 2, the auditor should identify and document
critical control points in the entity�s information systems and key
applications, based on the auditor�s understanding of such systems and
applications, key areas of audit interest, and IS risk. Based on
information obtained during audit planning, the auditor identifies
critical control points related to the entity�s key applications
(applications that are significant to the audit objectives and key
areas of audit interest). Critical control points at the application
level (in addition to critical control points at the system levels) are
those points, which if compromised, could significantly affect the
integrity, confidentiality, or availability of key business process
applications or related data. Critical control points at the business
process application level typically include application level general
controls, and interface controls among several applications. Typical
critical control points also include network components where business
process application level controls are applied. As the audit testing
proceeds and the auditor gains a better understanding of the
applications, application functionality, controls within and outside
each application, control weaknesses, and related risks, the auditor
should reassess and reconsider the critical control points.
4.0.3.G Obtain a preliminary understanding of application controls:
Within each key business process application, the auditor should obtain
an understanding of the particular types of application level controls
that are significant to the audit objectives. If the audit objectives
relate to a comprehensive assessment of the effectiveness of
application controls within one or more applications, the auditor
should obtain an understanding of controls implemented by the entity to
achieve each of the critical elements for each key application. If the
assessment of application controls is performed in connection with a
financial audit, the auditor should assess the effectiveness of those
controls that are identified by the financial auditor (controls
identified in the Specific Control Evaluation (SCE) Worksheet in
federal financial audits) and other related controls upon which the
effectiveness of these controls depend. The responsibility to identify
financial reporting controls rests primarily with the financial
auditor, but the information systems auditor should be consulted in
this process. Financial reporting controls generally contain both
computer-related (those whose effectiveness depends on computer
processing) and non-computer-related controls. Computer-related
controls include: general controls, application controls, and user
controls. The SCE Worksheet is more fully discussed in section 395 H of
the Financial Audit Manual (FAM).
The auditor should obtain a preliminary understanding of business
process application controls in each of the following control
categories to the extent they are significant to the audit objectives:
* Application level general controls;
* Business Process;
* Interface controls; and;
* Data management systems. Frequently each type of control occurs
within a business process and such controls are interdependent. The
auditor should consider the interaction between each of these types of
controls. For example, interface and data management controls are inter
linked since many of the feeder systems reside on some type of data
management system whose controls must be effective to ensure the
integrity of the data it maintains, including social security numbers,
vendor names, and other sensitive information. Further, interface and
business process controls are linked in that controls should be
established that ensure the timely, accurate and complete processing of
information between the feeder and receiving systems and the mainline
business processes they support.
To document the auditor�s understanding, the auditor may complete the
control tables in Appendices II and III on a preliminary basis. The
auditor generally should review available application documentation
that explains processing of data within the application. The auditor
generally should inspect any narratives, flowcharts, and documentation
related to system and application, including error reporting.
As part of this step, the auditor should determine whether application
level controls are effectively designed. In considering whether
controls are effectively designed, the auditor considers the type of
control. The effectiveness of business process application controls,
and the nature, timing, and extent of assessment procedures, depend on
the nature of the control.
As discussed in Chapter 1, information system (IS) controls consist of
those internal controls that are dependent on information systems
processing and include general controls (entitywide, system, and
business process application levels), business process application
controls (input, processing, output, master file, interface, and data
management system controls), and user controls (controls performed by
people interacting with information systems). General and business
process application controls are always IS controls. A user control is
an IS control if its effectiveness depends on information systems
processing or the reliability (accuracy, completeness, and validity) of
information processed by information systems. Conversely, a user
control is not an IS control if its effectiveness does not depend on
information systems processing or the reliability of information
processed by information systems.
Application controls can be automated or manual. The auditor will find
that most business processes will have a combination of automated and
manual controls that balance resource requirements and risk mitigation.
Also, management may use manual controls as effective monitoring
controls. It is important to understand how these types of controls
inter-relate when assessing application controls. The auditor should
evaluate the adequacy of controls, both automated and manual, to
determine whether or not management has appropriately mitigated risks
and achieved its control objectives.
Automated business process controls can provide a higher level of
consistency in application, and can also be timelier in preventing an
undesired outcome. Automated controls have greater consistency because
once designed and implemented, they will continue to operate as
designed, assuming the presence of effective general controls (at all
levels). Automated controls can also be designed to block a transaction
from proceeding through the process, making them timelier in preventing
an undesired outcome. For example, a vendor invoice can be blocked for
payment automatically if the goods or services are not received or if
the payment exceeds a specific threshold and requires additional review
and approval. Manual controls, such as the review of reports or
payments over a certain amount, could effectively detect an invoice
payment without goods receipt, or a high-dollar payment, but may not
occur in time to stop the payment.
The operating effectiveness of an automated application control during
the audit period also depends on the operating effectiveness of related
general controls (at the entitywide, system and applications levels).
For example, effective general controls are necessary to prevent or
detect management overrides or other unauthorized changes to computer
applications or data that could preclude or impair the operation of the
automated control.
Automated controls can be further subdivided into:
* Inherent Controls are those that have been hard coded and built into
the application logic and cannot be changed by end users. The self-
balancing capability provided by some applications is an example of an
inherent control (e.g., in a financial application, the transaction
will not post until debits = credits.
* Configurable Controls are those that have been designed into the
system during application implementation and address the features most
commonly associated with options available to guide end users through
their assigned tasks. Workflow to approve purchase requisition and
purchase orders, commitments not to exceed obligations, and dollar
value threshold to process transactions are examples of configurable
controls.
ERP systems by design are Extensible Business Reporting Language (XBRL)
compliant, which means that they can be configured to prepare reports
based upon standard rules or �taxonomies.� The auditor should
understand the nature and extent of any XBRL use and evaluate the
controls surrounding such reporting processes.
Automated controls cannot contemplate and reasonably forecast the
outcome of every type of uncertainty, nor can it prevent or detect
every possible error or intentional misuse of application
functionality. For example, well-designed segregation of duty controls
could be compromised by collusion. Manual controls, therefore, may be
used either in situations where ideal controls, such as complete
segregation of duties, can't be implemented to prevent something from
occurring, or when manual controls offer an effective, cost-effective
control option.
Manual controls (sometimes referred to as user controls) require human
involvement, usually by way of approval of a critical step in a
business process (example: signed purchase requisition) or reviewing
for exceptions and compliance by reviewing system output. Generally,
the auditor considers and tests manual controls along with automated
controls. Testing only one type of application control may lead to
incorrect assessment of key controls management may be relying on.
When the effectiveness of a manual control that is significant to the
audit objectives depends on the reliability of computer-processed
information, it is considered an IS control and, the auditor should
assess the effectiveness of relevant general (at the entitywide,
system, and application levels) and business process application,
controls over the reliability of the information used. Also, the
effectiveness of manual controls is dependent on how consistently and
effectively the control is applied. The auditor considers the following
when reviewing manual controls:
* The competence of the individuals performing control activities
(reviewing the reports or other documents). They should have an
adequate level of business knowledge and technical expertise and be
familiar with the entity's operations.
* The authority of the individuals performing the reviews to take
corrective action. They should be adequately positioned within the
entity to act effectively.
* The objectivity of the individuals performing the reviews. The
individuals should be independent of those who perform the work, both
functionally (that is, there should be adequate segregation of duties)
and motivationally (for example, a review would be less effective if
the reviewer's compensation is based on operating results being
reviewed).
* The nature and quality of the information reviewed by management.
* The frequency and timeliness of performance of reviews.
* The extent of follow-up performed by management.
* The extent to which controls can be tested (i.e., the auditor's
ability to corroborate management's responses to inquiries).
In addition to automated and manual controls performed prior to or
during transaction processing, monitoring controls may be applied by
management after the processing has taken place. Their objective is to
identify any errors that have not been prevented or detected by other
controls. Examples of monitoring controls include:
* Review of a report of revenue with overall knowledge of the volume of
goods shipped.
* Monitoring of capital expenditures via a quarterly report that
analyzes expenditures by department with comparisons to budgeted
levels.
* Monitoring of budget versus actual program cost.
4.0.3.H Perform other audit planning procedures:
As discussed in more detail in Chapter 2, the auditor should address
the following issues during the planning phase that could affect the
application control audit:
* relevant laws and regulations;
* staffing and other resources needed to perform the audit;
* multi-year planning;
* communication to management officials concerning the planning and
performance of the audit, and to others as applicable;
* use of service organizations;
* using the work of others; and;
* preparation of an audit plan.
4.0.4 Perform Information System Controls Audit Tests of Business
Process Application Level Controls:
The auditor�s assessment of application controls has two main aspects:
testing the effectiveness of controls, and evaluating the results of
testing. The process of testing and evaluation are planned and scoped
during the planning phase, as discussed in Chapter 2. As the auditor
obtains additional information during control testing, the auditor
should periodically reassess the audit plan and consider whether
changes are appropriate.
The auditor should perform the following procedures as part of testing
and evaluating the effectiveness of application level controls:
* Understand information systems relevant to the audit objectives,
building on identification of key areas of audit interest and critical
control points.
* Determine which IS control techniques are relevant to the audit
objectives. The control categories, critical elements, and control
activities in Chapters 3 and 4 are generally relevant to all audits.
However, if the auditor is not performing a comprehensive audit, for
example, an application review, then there may be no need to assess
controls in Chapter 3.
* For each relevant IS control technique, determine whether it is
suitably designed to achieve the critical activity and has been
implemented -- placed in operation (if not done earlier);
* Perform tests to determine whether such control techniques are
operating effectively;
* Identify potential weaknesses in IS controls (weaknesses in design or
operating effectiveness); and;
* For each potential weakness, consider the impact of compensating
controls or other factors that mitigate or reduce the risks related to
the potential weakness.
The auditor considers the following in designing the tests of
application level controls:
* The nature of the control;
* The significance of the control in achieving the control
objective(s);
* The risk of the control not being properly applied. [also see FAM
340];
* All of the key controls that management is relying on to address the
risks for a specific business process or a sub-process, which may
include automated and manual controls;
* The key controls outside the application under audit, as the business
process may involve other applications for a downstream or upstream sub-
process; and;
* The strength or weakness of the entitywide and system level controls.
The depth of the testing is based on the level of risk of the entity
under review and the audit objectives. In the absence of effective
general controls, the auditor may conclude that business process
application level controls are not likely to be effective.
4.0.5 Report Audit Results:
As a final step of the audit of application level controls, the auditor
should conclude on the individual aggregate aggregate effect of
identified application control weaknesses on the audit objectives and
report the results of the audit. Such conclusions generally should
include the effect of any weaknesses on the entity�s ability to achieve
each of the critical elements in Chapters 3 and 4, and on the risk of
unauthorized access to key systems or files. The auditor�s conclusions
should be based upon the potential interdependencies of application
controls (i.e., controls which effectiveness depends on the
effectiveness of other controls).
Prior to developing an audit report, it is generally appropriate to
communicate identified weaknesses to management to obtain their
concurrence with the facts and to understand whether there are
additional factors that are relevant to the auditor�s evaluation of the
effect of the weaknesses. Communication of identified weaknesses to
management typically includes the following information:
* Nature and extent of risks;
* Control Objectives;
* Control Activity;
* Findings (including condition, criteria, and where possible, cause
and effect), and;
* Recommendations Chapter 2 provides additional guidance on reporting
audit results.
4.1. Application Level General Controls (AS):
Application level general controls consist of general controls
operating at the business process application level, including those
related to security management, access controls, configuration
management, segregation of duties, and contingency planning. In this
chapter, the general control activities discussed in Chapter 3, as well
as related suggested control techniques and audit procedures, are
tailored to the application level. Understanding business processes or
events is necessary to determine the role of application level general
controls in the assessment of business process application controls.
Chapter 3 addresses controls at the entitywide and system levels, such
as those related to networks, servers, general support systems and
databases that support one or more business and financial systems.
Additional security considerations specific to applications are
discussed in this section.
Application level general controls are dependent on general controls
operating at the entitywide and system levels. The application is
generally a subset of the infrastructure that includes one or more
operating systems, networks, portals, LDAPs, and data management
systems. For example, the system level access controls discussed in
Chapter 3 apply to the users of the application. In addition,
applications themselves require another level of access requirements
that restrict users to application functionality that aligns with the
user�s role in the organization. The objective of application level
general controls is to help entity management assure the
confidentiality, integrity, and availability of information assets, and
provide reasonable assurance that application resources and data are
protected against unauthorized:
� Modification,
- Disclosure,
� Loss, and,
� Impairment.
Weaknesses in application level general controls can result in
unauthorized access, use, disclosure, disruption, modification, or
destruction of applications and application data. Consequently,
weaknesses in application level general controls can affect the
achievement of all of the control objectives (completeness, accuracy,
validity, and confidentiality) related to applications data. Therefore,
the control activities in the control tables for application level
general controls do not contain reference to specific control
objectives.
The evaluation of application level general controls is comprised of
critical elements in the following areas: Security Management, Access
Control, Configuration Management, Segregation of Duties and
Contingency Planning. Application-specific technical knowledge is
essential to assess the application level general controls. The
critical elements for application level general controls are:
* AS-1 - Implement effective application security management;
* AS-2 - Implement effective application access controls;
* AS-3 - Implement effective application configuration management;
* AS-4 - Segregate application user access to conflicting transactions
and activities and monitor segregation;
* AS-5 - Implement effective application contingency planning.
The related NIST SP 800-53 controls are identified in Chapter 3.
Critical Element AS-1. Implement effective application security
management.
Effective application security management provides a foundation for
entity management to obtain reasonable assurance that the application
is effectively secure. Application security management provides a
framework for managing risk, developing security policies, assigning
responsibilities, and monitoring the adequacy of the entity�s
application-related controls. Without effective security management
over the application, there is an increased risk that entity
management, IT staff, and application owners and users will not
properly assess risk and will, consequently, implement inappropriate
and/or inadequate information security over the application. Consistent
with security management at the entitywide and system levels,
application security management includes the following key components,
which are discussed in more detail below:
* Establish an application security plan;
* Periodically assess and validate application security risks;
* Document and implement application security policies and procedures;
* Ensure that application owners and users are aware of application
security policies and procedures;
* Monitor the effectiveness of the security program;
* Effectively remediate information security weaknesses;
* Implement effective security-related personnel policies;
* Adequately secure, document and monitor external third party
activities.
Establish an application security plan:
An application security plan serves as a roadmap during the entire
security development and maintenance lifecycle of the application, and
is therefore critical to the auditor in gaining a high-level
understanding of the entity�s application security. The lack of a
comprehensive, documented security design increases the risk of
inappropriate system access and compromised data confidentiality,
integrity, and availability. Risks of not having a security program at
the application level include the following:
* The process to gather design requirements may be compromised without
clear guidelines on approval and sign off procedures for security
roles.
* Ongoing requirements for business process owners to provide
authorization specifications to the security design team (e.g., field-
level security, role testing, etc.) may be compromised without a
guideline to drive the joint-effort process.
* Security roles could be defined inappropriately resulting in users
being granted excessive or unauthorized access.
For federal systems, NIST Special Publication 800-18, Guide for
Developing Security Plans for Federal Information Systems, provides
guidance on documenting information system security controls. The
general guidance in SP 800-18 is augmented by SP 800-53 with
recommendations for information and rationale to be included in the
system security plan.
Periodically assess and validate application security risks:
Chapter 3 (SM-2) discusses comprehensive risk assessment, and provides
guidance on risk assessment. The guidance includes requirements
contained in various regulatory requirements, such as FISMA, FMFIA and
OMB Circular A-130, and standards developed by NIST.[Footnote 90] Risk
assessments should consider risks to data confidentiality, integrity,
and availability, and the range of risks that an entity�s systems and
data may be subject to, including those posed by internal and external
users. The Security Management section of Chapter 3 addresses the
entitywide and system level security risk assessments. Risk assessments
also should be conducted for applications, and documented in the
security plan, as discussed in NIST SP 800-18.
Document and implement application security policies and procedures:
Based on the application security plan, the entity should document and
implement specific policies and procedures that govern the operation of
application controls. Policies and procedures should address all
business process application level controls, be documented and reflect
current application configurations.
In defining policies and procedures for application controls, the
following should also be considered:
* High risk business processes � Procurement, Asset Management,
Treasury, etc.
* Functionality that should not be widely distributed - For example,
limiting vendor master data maintenance to a few users is critical to
ensure master data integrity and reliable transaction processing.
* Segregating master data and transactional data (Contrary to master
data, transactional data result from a single event, and often use
several field values of the master data.) � For example, combining
vendor creation and payment authorization could result in payments to
unauthorized vendors.
* Cross-business unit access - Should be limited to users who have a
specific business need.
Implement effective security awareness and other security-related
personnel policies:
It is important that application owners and users are aware of and
understand the application security policies and procedures so that
they may be properly implemented. Improper implementation could result
in ineffective controls and increased information security risks.
Awareness programs should be coordinated with the entitywide training
program to reasonably assure that the training is appropriate and
consistent for all applications.
Monitor the effectiveness of the security program:
Policies and procedures for monitoring application security should be
integrated with monitoring performed as part of the entitywide
information security program. Changes related to people, processes, and
technology, often make policies and procedures inadequate. Periodic
management evaluation not only identifies the need to change the
policies and procedures, when appropriate, but also demonstrates
management's commitment to an application security plan that is
appropriate to the agency�s mission. The basic components of an
effective monitoring program are discussed in Chapter 3 (Critical
element SM-5), which provides guidelines for monitoring the policies
and procedures relevant to application security. Management should have
an adequate plan for monitoring policy effectiveness, and should test
and document application security controls on a regular basis.
Management should consider ways to effectively coordinate monitoring
efforts with work performed to comply with applicable laws and
regulations and should consider them in developing an application
security monitoring assessment plan. Examples of such requirements for
federal entities include: FISMA, OMB Circular A-130 and OMB Circular A-
123. FISMA requires that security of all major systems is tested by
management annually, which would include applications. The depth and
breadth of the testing may vary based on the following factors:
* The potential risk and magnitude of harm to the application or data;
* The criticality of the application to the agency�s mission;
* The relative comprehensiveness of the prior year�s review; and;
* The adequacy and successful implementation of corrective actions for
weaknesses identified in previous assessments.
OMB Circular A-130 requires that Federal agencies assess and test the
security of major applications at least once every 3 years, as part of
the certification and accreditation (C&A) process; sooner if
significant modifications have occurred or where the risk and magnitude
of harm are high.
OMB Circular A-123 requires agencies and individual Federal managers to
take systematic and proactive measures to (i) develop and implement
appropriate, cost-effective internal control for results-oriented
management; (ii) assess the adequacy of internal control in Federal
programs and operations; (iii) separately assess and document internal
control over financial reporting consistent with the process defined in
Appendix A; (iv) identify needed improvements; (v) take corresponding
corrective action; and (vi) report annually on internal control through
management assurance statements. The implementation guidance for OMB
Circular A-123 includes requirements that are wholly consistent with
this manual.
The entity should take into consideration the statutory and regulatory
requirements in its assessment of the effectiveness of application
security policies and procedures, and testing of application security
controls. Management should:
* develop and document the assessment plan of application security
policies and procedures;
* test and document application security controls specific to each
application; and;
* ensure that the frequency and scope of testing are commensurate with
the criticality of the application to the agency�s mission and risk.
Effectively remediate information security weaknesses:
Management�s commitment to application security is also demonstrated in
having an effective mechanism to address weaknesses and deficiencies
identified. When weaknesses or deficiencies are identified in
application security, management should assess the risk associated with
the weakness or deficiency, and develop a corrective action plan (for
federal agencies. OMB refers to these as Plans of Actions and
Milestones (POAMs)). The action plan should include testing
requirements of corrective actions, milestones, monitoring of
activities related to the action plan, modification to policies and
procedures (if required) and implementation of the corrective action.
Such action plans should be coordinated with the entitywide corrective
action plan process.
Implement effective security-related personnel policies:
Entitywide security-related personnel policies and procedures (see
critical element SM-6) should be properly implemented with respect to
the application. For example, controls should be in place to reasonably
assure that (1) application users are appropriately trained, and (2)
risks related to confidentiality, integrity, and availability are
considered in approving user access (e.g., security clearances) and in
applying personnel policies.
Adequately secure, document, and monitor external third party
activities:
An agency may allow external third parties access to their systems for
various purposes. Chapter 3 discussed policies and procedures regarding
the system access granted to third party providers (e.g. service
bureaus, contractors, system development, security management),
including the requirement to have appropriate controls over outsourced
software development. Third party provider access to applications often
extends beyond the software development. It is likely that entities
have vendors, business partners and contractors not only querying the
applications, but also transacting with the agency, using agency
applications, or connecting to the agency�s applications via their own
systems. In addition, public web sites are sometimes used to transact
with the agency.
The impact of an external third party provider accessing the agency�s
applications is directly related to the magnitude of the system or
direct access the provider is granted. This is determined by the
entity�s agreement with the provider. The entity should, however,
require the providers to be subject to the same compliance requirements
as the agency, and have the ability to monitor such compliance.
Appropriate policies and procedures should exist for monitoring third
party performance to determine whether activities performed by these
external third parties are compliant with the agency�s policies,
procedures, privacy requirements, agreements or contracts.[Footnote 91]
Table 39. Control Techniques and Suggested Audit Procedures for
Critical Element AS-1: Implement effective application security
management:
Control activities:
AS-1.1 A comprehensive application security plan is in place.
Control techniques:
AS-1.1.1 A comprehensive application security plan has been developed
and documented. Topics covered include:
* Application identification and description;
* Application risk level;
* Application owner;
* Person responsible for the security of the application;
* Application interconnections/information sharing;
* A description of all of the controls in place or planned, including
how the controls are implemented or planned to be implemented and
special considerations;
* Approach and procedures regarding security design and upgrade
process;
* Process for developing security roles;
* General security administration policies, including ongoing security
role maintenance and development;
* Identification of sensitive transactions in each functional module;
* Identification of high risk segregation of duty cases;
* Roles and responsibilities of the security organization supporting
the system with consideration to segregation of duties;
* Security testing procedures;
* Coordination with entitywide security policies;
* Procedures for emergency access to the production system, including
access to update programs in production, direct updates to the
database, and modification of the system change option;
* System parameter settings, compliant with entitywide agency policies;
* Access control procedures regarding the use of system delivered
critical user IDs;
Audit procedures:
Inspect the application security plan to determine whether it
adequately addresses all of the relevant topics.
Control activities:
AS-1.1 A comprehensive application security plan is in place.
Control techniques:
AS-1.1.2 Sensitive accounts are identified for each business process or
sub-process, and appropriate security access privileges are defined and
assigned.
Audit procedures:
Review the entity�s identification of sensitive transactions for the
business process being audited for appropriateness and completeness.
Observe and inspect procedures for identifying and assigning sensitive
activities. Inspect authorizations for sensitive activities.
Control activities:
AS-1.1 A comprehensive application security plan is in place.
Control techniques:
AS-1.1.3 Access privileges are developed to prevent users from
executing incompatible transactions within the application via menus or
screens.
Audit procedures:
Through inquiry and inspection, determine whether the application
security plan includes plans to identify segregation of duty conflicts
in each of the business processes under assessment (master data and
transaction data; data entry and reconciliation), and addresses
controls to mitigate risks of allowing segregation of duty conflicts in
a user�s role.
Control activities:
AS-1.2 Application security risk assessments and supporting activities
are periodically performed;
Control techniques:
AS-1.2.1 Security risks are assessed for the applications and
supporting systems on a periodic basis or whenever applications or
supporting systems significantly change. The risk assessments and
validation, and related management approvals, are documented and
maintained. The risk assessments are appropriately incorporated into
the application security plan.
Audit procedures:
Obtain the most recent security risk assessment for each application
under assessment. Inspect the risk assessments to determine if the risk
assessments are up-to-date, appropriately documented, approved by
management, and supported by testing. Consider compliance with FISMA,
OMB, NIST, and other requirements/ guidance and whether technology and
business processes are appropriately considered in the risk assessment.
Obtain and inspect the relevant application security plan(s) to
determine whether the risk assessments are appropriately incorporated
into the application security plan.
Control activities:
AS-1.3 Policies and procedures are established to control and
periodically assess access to the application.
Control techniques:
AS-1.3.1 Business process owners accept risks and approve the policies
and procedures. AS-1.3.2 Policies and Procedures are:
* documented;
* appropriately consider business process security needs;
* appropriately consider segregation of application user activity from
the system administrator activity.
Audit procedures:
Determine through interview with entity management whether policies and
procedures have been established to review access to the application.
Review policies and procedures to determine whether they have
appropriately considered (1) business security needs and (2)
segregation of application user activity from system administrator
activity.
Control activities:
AS 1.4 Application owners and users are aware of application security
policies;
Control techniques:
AS-1.4.1 The entity has an effective process to communicate application
security policies to application owners and users and reasonably assure
that they have an appropriate awareness of such policies.
Audit procedures:
Obtain an understanding of how application owners and users are made
aware of application security policies and assess the adequacy of the
process. Interview selected application owners and users concerning
their awareness of application security policies.
Control activities:
AS-1.5 Management periodically assesses the appropriateness of
application security policies and procedures, and compliance with them.
Control techniques:
AS-1.5.1 An application security policy and procedure test plan is
developed and documented.
Audit procedures:
Inquire of management, and inspect testing policies and procedures.
Control activities:
AS-1.5 Management periodically assesses the appropriateness of
application security policies and procedures, and compliance with them.
Control techniques:
AS-1.5.2 Security controls related to each major application are tested
at least annually.
Audit procedures:
Inspect the overall testing strategy, a sample of test plans and
related testing results. Determine if the scope of testing complies
with OMB Circular A-123 Revised (federal entities) and other
appropriate guidance. Determine if C&A testing is performed that
complies with FISMA and NIST requirements.
Control activities:
AS-1.5 Management periodically assesses the appropriateness of
application security policies and procedures, and compliance with them.
Control techniques:
AS-1.5.3 The frequency and scope of testing is commensurate with the
risk and criticality of the application to the agency�s mission.
Audit procedures:
Based upon the application test plan, assess whether the frequency and
scope of testing is appropriate, given the risk and critically of the
application.
Control activities:
AS-1.5 Management periodically assesses the appropriateness of
application security policies and procedures, and compliance with them.
Control techniques:
AS-1.5.4 Compliance, and a report on the state of compliance, is part
of the entity�s security program.
Audit procedures:
Determine through inquiry and inspection if the application security
plan is incorporated into the entity's security program.
Control activities:
AS-1.6 Management effectively remediates information security
weaknesses.
Control techniques:
AS-1.6.1 Management has a process in place to correct deficiencies.
Audit procedures:
Inquire of management and inspect security polices and procedures,
including assessment and resolution plan.
Control activities:
AS-1.6 Management effectively remediates information security
weaknesses.
Control techniques:
AS-1.6.2 Management initiates prompt action to correct deficiencies.
Action plans and milestones are documented and complete.
Audit procedures:
Inspect recent FMFIA/A-123 and POA&M (or equivalent) reports for
reasonableness of corrective actions (nature and timing). Determine
whether application security control deficiencies (identified by the
audit, by management testing, and by others) are included in the plans
of action and milestones (or equivalent). and determine the status of
corrective actions.
Control activities:
AS-1.6 Management effectively remediates information security
weaknesses.
Control techniques:
AS-1.6.3 Deficiencies are analyzed by application (analysis may be
extended to downstream, upstream, and other related applications), and
appropriate corrective actions are applied.
Audit procedures:
Evaluate the scope and appropriateness of planned corrective actions
through inquiry of management and inspection of evidence.
Control activities:
AS-1.6 Management effectively remediates information security
weaknesses.
Control techniques:
AS-1.6.4 Corrective actions are tested after they have been implemented
and monitored on a continuing basis.
Audit procedures:
Inspect documentation to determine if implemented corrective actions
have been tested and monitored periodically.
Control activities:
AS-1.7 Implement effective security-related personnel policies;
Control techniques:
AS-1.7.1 Personnel policies related to the application appropriately
address security and application owners and users have adequate
training and experience.
Audit procedures:
Review personnel policies for appropriateness and consistency with
entitywide policies. Assess the adequacy of training and expertise for
application owners and users.
Control activities:
AS-1.8 External third party provider activities are secure, documented,
and monitored;
Control techniques:
AS-1.8.1 Policies and procedures concerning activities of third party
providers are developed and include provisions for:
* Application compliance with agency�s security requirements, and;
* Monitoring of compliance with regulatory requirements;
Audit procedures:
Inspect policies and procedures pertaining to external parties for the
application under assessment. Inspect documentation to determine
whether the external third party provider�s need to access the
application is appropriately defined and documented.
Control activities:
AS-1.8 External third party provider activities are secure, documented,
and monitored;
Control techniques:
AS-1.8.2 A process is in place to monitor third party provider
compliance to the agency�s regulatory requirements;
Audit procedures:
Inquire of management regarding procedures used to monitor third party
providers. Inspect external reports (SAS 70) or other documentation
supporting the results of compliance monitoring.
Source: GAO.
[End of table]
Critical Element AS-2. Implement effective application access controls:
Effective application access controls should be implemented at the
application level to provide reasonable assurance that only authorized
personnel have access to the application and only for authorized
purposes. Without effective application access controls, persons may
obtain unauthorized or inappropriate access to applications and
application data.
Application access controls include the following:
* Adequately protect information system boundaries.
* Implement effective identification and authentication mechanisms.
* Implement effective authorization controls.
* Adequately protect sensitive system resources.
* Implement an effective access audit and monitoring capability.
* Establish adequate physical security controls.
Adequately protect application boundaries:
Application boundaries control logical connectivity to and from
applications through controlled interfaces (e.g., gateways, routers,
firewalls, encryption). In defining the application, the entity creates
the boundaries for the application. Once defined, the entity should
design appropriate controls over the flow of information across the
application boundary. In complex applications, there may boundaries
within the application. The security plan for the application should
identify system boundaries and IS controls implemented to protect the
security of such boundaries. Application boundaries are more sensitive
where the connectivity is to lower risk systems or to systems or users
external to the entity.
Implement effective identification and authentication mechanisms:
The entity should have application security policies and procedures in
place concerning user identification and authentication. Management
should have created an environment where all users have their own
unique IDs and passwords, or other mechanisms, such as tokens and
biometrics to access any part of the information system and
applications that allow them to execute functional responsibilities.
Identification and authentication policy and management are discussed
in Chapter 3, Critical Element AC-2. In addition, it is important to
understand the mechanisms used to assign access privileges for
applications under assessment. An evaluation of identification and
authentication controls includes consideration of the following
factors:
* How do the users access the application?
a. Are users required to enter user name/ID and password?
b. Do all users have an individual and unique ID that would allow the
user's activities to be recorded and reviewed?
c. Are users required to enter/use other authenticating information,
such as tokens or biometrics?
d. Are users required to enter a separate ID and password for each
application?
e. Does the application require the user to enter a password?
f. What are the password parameters (i.e. length, character
requirements, etc)?
g. How often does the application require the user to change the
password?
h. Are there any instances of users having multiple IDs and passwords?
i. Are there any instances of users sharing IDs or passwords?
* What other IDs and passwords does the user have to enter before
accessing the sign-in screen for the application?
a. Does the user enter a network ID and password?
b. Does the user enter a terminal emulation ID and password?
The knowledge of the application security design and function enables
the auditor to assess the effectiveness of the security controls over
the other levels of authentication, especially when weaknesses are
identified at the application security layer, as those weaknesses may
be mitigated by stronger controls at other levels.
Implement effective authorization controls:
The following procedures discussed in Chapter 3 are equally applicable
at the application level:
* The owner identifies the nature and extent of access that should be
available for each user;
* The owner approves user access to the application and data;
* Access is permitted at the file, record, or field level; and;
* Owners and security managers periodically monitor user access.
Security administration procedures should provide tactical guidance on
the day-to-day operations of creating, assigning, monitoring, updating,
and revoking end-user access to the application. End-users should be
assigned authorizations sufficient, but not excessive, to perform their
duties in the application: Access should be limited to individuals with
a valid business purpose (least privilege). The users should be granted
the level of access by virtue of the position they hold within the
organization. This will generally require user to have both:
* Functional access (for example, accounts payable) based on the role
from which their position derives; and;
* Organizational access (for example, account payable supervisor) based
on the specific needs of their position.
Sensitive transactions and segregation of duty conflicts defined by the
process and data owners (discussed in AS-1) should be used as a
baseline reference by security administration. In an integrated
application environment, the importance of comprehensive identification
of sensitive transactions and segregation of duty needs and conflicts
is heightened, compared with entities having multiple applications for
business processes. Entities lose the inherent segregation in
integrated applications�since more of the process is performed in the
same application, the opportunities for access throughout the process
are greater. For example, in an entity with separate purchasing and
accounts payable applications, adequate segregation of duties might be
accomplished by only allowing access to one of the applications,
whereas in an integrated application, these applications may be
combined. Transaction-level restricted access, which is critical in
integrated applications, may be less critical in non-integrated
systems.
However, in an integrated environment, the entire business process
cycle may be performed in the same application and a user may have the
ability to perform more than one key activity in the cycle. Therefore,
restricted access (access to a sensitive business transaction) and
segregation of duty conflicts (access to two or more transactions that
are sensitive in combination) should be considered carefully.
An integrated application environment also generally means that more
business units of the entity are using the same application. Therefore,
business unit access restrictions are also necessary. Management should
have an adequate understanding of the business processes and determine
whether users should have access to more than their individual business
unit. For example, a property manager should not have access to change
asset records or maintenance schedules for entities other than his/her
own.
Sensitive transactions or activities in an application are determined
by the nature and use of the data processed by the application. Factors
that determine the sensitivity include the mission critical elements of
the application, pervasive use of the data or activity, confidentiality
and privacy of data, and activities performed or supported by the
application.
The key element in assigning access to sensitive transactions or
activities to an application user is the alignment of user access to
job responsibility. This has a dual purpose: one, the proper alignment
ensures that the user has accountability for proper execution of the
transactions and accuracy of the related data, and two, the expertise
and skills of the user match the business process underlying the
transaction or activity. For example journal voucher entry is made by a
General Accounting Account Analyst of Finance Department, and not by a
Procurement manager.
Adequately protect sensitive application resources:
Access to sensitive application resources should be restricted to
individuals or processes that have a legitimate need for this access
for the purposes of accomplishing a valid business purpose. Sensitive
application resources include password files, access authorizations to
read or modify applications, and sensitive application functions such
as application security administration. The entity should identify and
adequately protect sensitive application resources. In some cases,
sensitive data may need to be encrypted.
Implement an effective audit and monitoring capability:
Audit and monitoring involves the regular collection, review, and
analysis of indications of inappropriate or unauthorized access to the
application. Automated controls may be used to identify and report such
incidents. An understanding of manual control activities surrounding
access to the application is important. The following questions can
help the auditor gain insight into management�s controls:
* Does management maintain and review a current list of authorized
users?
* Does management periodically review the user list to ensure that only
authorized individuals have access, and that the access provided to
each user is appropriate?
* Does management monitor access within the application (i.e.
unauthorized access attempts, unusual activity etc.)? Does the
application generate reports to identify unauthorized access attempts?
Are security logs created and reviewed?
* Is public access (non agency employees) permitted to the application?
Is access permitted via the Internet? If so, how is this access
controlled?
* Is the application configured to allow for segregation of duties? If
so, does the application identify the users who performed activities
that were in conflict? Are the transactions/logs reviewed by the
business owners?
* Has a procedure been created and placed in operation that requires a
complete user recertification on a periodic basis?
* Is the security administration monitored? When suspicious activities
are identified, how does management investigate them?
Establish adequate physical security controls:
Appropriate physical controls, integrated with related entitywide and
system level physical security, should be in place to protect
resources, where applicable, at the application level. Resources to be
protected at the application level include controls over removable
media (e.g., tape files), workstations containing sensitive application
data, and physical inputs (e.g., check stock) and outputs (e.g.,
physical checks or other sensitive documents). The entity should
identify application resources that are sensitive to physical access
and implement adequate physical security over such resources.
Table 40. Control Techniques and Suggested Audit Procedures for
Critical Element AS-2: Implement effective application access controls:
Control activities:
AS-2.1 Application boundaries are adequately protected.
Control techniques:
AS-2.1.1 Application boundaries are identified in security plans.
Application boundaries are adequately secure.
Audit procedures:
Review security plans for proper identification of application
boundaries. Evaluate the effectiveness of controls over application
boundaries.
Control activities:
AS-2.2 Application users are appropriately identified and
authenticated.
Control techniques:
AS-2.2 Identification and authentication is unique to each user. All
approved users should enter their user ID (unique) and password (or
other authentication) to gain access to the application.
Audit procedures:
Inspect pertinent policies and procedures, and NIST guidance for
authenticating user IDs. Through inquiry, observation or inspection,
determine the method of user authentication used (password, token,
biometrics, etc.). If a password system is used, gain an understanding
of the specific information and evaluate its appropriateness, including
application security authentication parameters, via inspection of
system reports or observation of the system, including appropriate
testing. See AC-2 for more information on criteria for evaluating
password policies.
Control activities:
AS-2.3 Security policies and procedures appropriately address ID and
password management.
Control techniques:
AS-2.3.1 The agency has formal procedures and processes for granting
users access to the application. The agency�s IT security policies and
procedures contain guidance for:
* Assigning passwords;
* Changing and resetting passwords; and;
* Handling lost or compromised passwords.
Audit procedures:
Through inquiry, observation, and inspection, understand and assess
procedures used by the agency for application password management:
* Procedures for initial password assignment, including the password
parameters;
* Procedures for password changes, including initial password change;
* Procedures for handling lost passwords (password resetting); and;
* Procedures for handling password compromise.
Control activities:
AS-2.3 Security policies and procedures appropriately address ID and
password management.
Control techniques:
AS-2.3.2 The application locks the user�s account after a pre-
determined number of attempts to log-on with an invalid password. The
application may automatically reset the user account after a specific
time period (an hour or a day), or may require an administrator to
reset the account. If the user is away from his/her workspace for a
preset amount of time, or the user's session is inactive, the
application automatically logs off the user�s account.
Audit procedures:
After obtaining an understanding of the user authentication process,
inspect and/or observe the following:
* Whether access to the application is permitted only after the user
enters their user ID and password.
* Observe a user executing invalid logins and describe the actions
taken. Either 1) inspect system security settings, or 2) observe an
idle user workspace to determine whether the application logs the user
off after an elapsed period of idle time.
Control activities:
AS-2.3 Security policies and procedures appropriately address ID and
password management.
Control techniques:
AS-2.3.3 Each application user has only one user ID.
Audit procedures:
Through observation and inspection, determine whether each user has
one, and only one, user ID to access the application.
Control activities:
AS-2.3 Security policies and procedures appropriately address ID and
password management.
Control techniques:
AS-2.3.4 Multiple log-ons are controlled and monitored.
Audit procedures:
Through inquiry, observation or inspection, determine whether the
application allows multiple log-ons by the same user. If so, understand
and document monitoring procedures that reasonably assure that multiple
log-ons are not used to allow application access to an unauthorized
user, or to violate effective segregation of duties.
Control activities:
AS-2.4 Access to the application is restricted to authorized users.
Control techniques:
AS-2.4.1 Before a user obtains a user account and password for the
application, the user�s level of access has been authorized by a
manager and the application administrator.
Audit procedures:
Review policies and procedures. From a sample of user accounts
determine whether the user level of access was authorized by
appropriate entity management.
Control activities:
AS-2.4 Access to the application is restricted to authorized users.
Control techniques:
AS-2.4.2 Owners periodically review access to ensure continued
appropriateness.
Audit procedures:
Interview security administrators and inspect evidence of the
effectiveness of periodic review of access by owners.
Control activities:
AS-2.4 Access to the application is restricted to authorized users.
Control techniques:
AS-2.4.3 Access is limited to individuals with a valid business purpose
(least privilege).
Audit procedures:
Interview owners and inspect documentation, to determine whether
appropriate procedures are in place to remove or modify application
access, as needed. Through inquiry, observation, and inspection,
determine how an unauthorized user is identified, and whether access is
removed promptly and how. Based on the sample of users in AS-2.4.1
above, determine whether the user access is appropriate to the business
need. If the users did not execute the transaction or activity within
the expected time frame, processes should be in place to evaluate the
continued need for access, and modify access accordingly.
Control activities:
AS-2.5 Public access is controlled. (Based on an agency�s business
mission, the agency may allow the public to have access to the
application.)
Control techniques:
AS-2.5.1 The agency implements a security plan and process for 1)
identification and authorization of users; 2) access controls for
limited user privileges; 3) use of digital signatures; 4) prohibition
of direct access by the public to production data; and 5) compliance
with FISMA and NIST requirements.
Audit procedures:
Obtain an understanding of the following controls through inquiry of
the application owner, inspection of source documents, and/or
observation of the following:
* Identification and authentication;
* Access controls for limiting user privileges(read, write, modify,
delete);
* Use of digital signatures;
* Prohibition of direct access by the public to live databases and
restricted/sensitive records; and Legal considerations (i.e., privacy
laws, FISMA, NIST, etc.).
Control activities:
AS-2.6 User access to sensitive transactions or activities is
appropriately controlled.
Control techniques:
AS-2.6.1 Owners have identified sensitive transactions or activities
for the business process.
Audit procedures:
Inquire of responsible personnel and inspect pertinent policies and
procedures covering segregation of application duties.
Control activities:
AS-2.6 User access to sensitive transactions or activities is
appropriately controlled.
Control techniques:
AS-2.6.2 Owners authorize users to have access to sensitive
transactions or activities.
Audit procedures:
Determine whether the process owners have identified a list of
sensitive transactions or activities for their area. Inspect the user
administration procedures to determine whether they include a
requirement for the process owner to approve access to transactions or
activities in their area of responsibility. Through inquiry and
inspection, determine whether user access is authorized by process
owners.
Control activities:
AS-2.6 User access to sensitive transactions or activities is
appropriately controlled.
Control techniques:
AS-2.6.3 Security Administrators review application user access
authorizations for access to sensitive transactions and discuss any
questionable authorizations with owners.
Audit procedures:
Select a sample of user access request forms or other authorization
documents [can use same sample selected in AS-2.4.1 and AS-2.4.3] and
inspect them to determine whether the process owners have approved user
access to appropriate transactions or activities.
Control activities:
AS-2.6 User access to sensitive transactions or activities is
appropriately controlled.
Control techniques:
AS-2.6.4 Owners periodically review access to sensitive transactions
and activities to ensure continued appropriateness. Inactive accounts
and accounts for terminated individuals are disabled or removed in a
timely manner.
Audit procedures:
Interview security administrators and inspect user access authorization
procedures to determine whether access to sensitive transactions
require approval by the process owner. Review security software
parameters and review system-generated list of inactive logon IDs, and
determine why access for these users has not been terminated. Obtain a
list of recently terminated employees and, for a selection, determine
whether system access was promptly terminated.
Control activities:
AS-2.6 User access to sensitive transactions or activities is
appropriately controlled.
Control techniques:
AS-2.6.5 Access to sensitive transactions is limited to individuals
with a valid business purpose (least privilege).
Audit procedures:
Interview owners and inspect documentation, to determine whether
appropriate procedures are in place to remove or modify application
access, as needed. Through inquiry, observations, and inspection,
determine how an unauthorized user is identified, and whether access is
removed promptly and how. Obtain a list of users with access to
identified sensitive transactions for the business process under
assessment. Inspect the list to determine whether the number of users
having access to sensitive transactions/ activities is appropriate to
the business need. If the users did not execute the transaction or
activity within the expected time frame, processes should be in place
to evaluate the continued need for access, and modify access
accordingly.
Control activities:
AS-2.7 Sensitive application resources are adequately protected.
Control techniques:
As-2.7.1 The entity identifies sensitive application resources. Access
to sensitive application resources is restricted to appropriate users.
Sensitive application data is encrypted, where appropriate.
Audit procedures:
Evaluate the completeness of sensitive application resources
identified. Assess the adequacy of IS controls over sensitive
application resources.
Control activities:
AS-2.8 An effective access audit and monitoring program is in place,
documented, and approved.
Control techniques:
AS-2.8.1 Policies and procedures are established to reasonably assure
that application security audit and monitoring is effective.
Audit procedures:
Inspect documented policies and procedures for application security
administration for each application in scope Determine whether the
monitoring program has built-in procedures to identify inappropriate
user assignments. Through inquiry and inspection, determine whether
monitoring procedures are performed on a regular basis. Determine
whether the exceptions are handled appropriately and in a timely
manner.
Control activities:
AS-2.9 Application security violations are identified in a timely
manner.
Control techniques:
AS-2.9.1 Logging and other parameters are appropriately set up to
notify of security violations as they occur.
Audit procedures:
Observe and inspect application logging and other parameters that
identify security violations and exceptions. (For example, parameter
set up indicates whether or not users can logon to an application more
than once)
Control activities:
AS-2.10 Exceptions and violations are properly analyzed and appropriate
actions taken.
Control techniques:
AS-2.10.1 Reportable exceptions and violations are identified and
logged. Exception reports are generated and reviewed by security
administration. If an exception occurs, specific action is taken based
upon the nature of exception.
Audit procedures:
Observe and inspect management�s monitoring of security violations,
such as unauthorized user access. Inspect reports that identify
security violations. Through inquiry and inspection, note management�s
action taken. Inspect reports of authorized segregation of duty
conflicts sensitive process access; Assess business level authorization
and monitoring, if applicable.
Control activities:
AS-2.11 Physical security controls over application resources are
adequate.
Control techniques:
AS-2.11.1 Physical controls are integrated with entitywide and system-
level controls. Application resources sensitive to physical access are
identified and appropriate physical security is placed over them.
Audit procedures:
Review the appropriateness of the entity�s identification of
application resources sensitive to physical access. Assess the adequacy
of physical security over sensitive application resources.
Source: GAO.
[End of table]
Critical Element AS-3 � Implement effective application configuration
management:
Entities need to proactively manage changes to system environments,
application functionality and business processes to reasonably assure
financial data and process integrity. To do this, entities should
restrict and monitor access to program modifications and changes to
configurable objects in the production environment. Configuration
Management (CM) discusses changes to baseline configuration of
applications, using the concepts of identification, control, status
reporting and auditing of configuration. Most application configuration
changes are managed using a staging process. The staging process allows
the entity to develop and unit test changes to an application within
the development environment, transport the changes into a Quality
Assurance environment for further system and user acceptance testing
and, when the tests have been completed and the changes are approved,
transport the changes into the production environment.
Control over business process applications modifications and
configurable objects is an extension of Configuration Management
controls in Chapter 3 that addresses an organization�s change
management process and should be coordinated with audit procedures
applied to that general control category. This chapter includes changes
to application functionality that do not go through the staging
process, but take place directly in the production environment of the
application as changes become necessary throughout the normal course of
business.
Effective application configuration management, consistent with Section
3.3 Configuration Management (CM), includes the following steps:
1. Develop and document CM policies, plans, and procedures.
2. Maintain current configuration identification information.
3. Properly authorize, test, approve, and track all configuration
changes, including:
* Documented system development life cycle methodology (SDLC);
* Adequate authorization of change requests that are documented and
maintained;
* Appropriate authorization for the user to change the configuration;
* Adequate control of program changes through testing to final
approval;
* Adequate control of software libraries; and;
* Appropriate segregation of duties over the user�s access to
reasonably assure that critical program function integrity is not
affected;
4. Routinely monitor the configuration.
5. Update systems in a timely manner to protect against known
vulnerabilities.
6. Appropriately document, test , and approve emergency changes to the
configuration.
In addition, NIST SP 800-100 provides guidance in assessing related
configuration management programmatic areas of capital planning and
investment control, and security services and product acquisition. This
publication discusses practices designed to help security management
identify funding needs to secure systems and provide strategies for
obtaining the necessary funding. Also, it provides guidance to entities
in applying risk management principles to assist in the identification
and mitigation of risks associated with security services acquisitions.
Table 41. Control Techniques and suggested audit procedures for AS-3 -
Implement Effective Application Configuration Management:
Control activities:
AS-3.1 Policies and procedures are designed to reasonably assure that
changes to application functionality in production are authorized and
appropriate, and unauthorized changes are detected and reported
promptly.
Control techniques:
AS-3.1.1 Appropriate policies and procedures are established for
application configuration management.
Audit procedures:
Inspect documented policies and procedures related to application
change control procedures. Through inquiry and inspection, identify key
transactions that provide user access to change application
functionality. Inspect transaction reports of changes made to the
application. For a sample of changes, inspect documentation of the
changes made, including the validity, reasons, authorization, and the
user authority. Note the handling of exceptions.
Control activities:
AS-3.2 Current configuration information is maintained.
Control techniques:
AS-3.2.1 The entity maintains information on the current configuration
of the application.
Audit procedures:
Review the entity�s configuration management information.
Control activities:
AS-3.3 A system development life cycle methodology has been
implemented.
Control techniques:
AS-3.3.1 A SDLC methodology has been developed that:
* provides a structured approach consistent with generally accepted
concepts and practices, including active user involvement throughout
the process;
* is sufficiently documented to provide guidance to staff with varying
levels of skill and experience;
* provides a means of controlling changes in requirements that occur
over the system life, and;
* includes documentation requirements.
Audit procedures:
Review SDLC methodology. Review system documentation to verify that
SDLC methodology was followed.
Control activities:
AS-3.4 Authorizations for changes are documented and maintained.
Control techniques:
AS-3.4.1 change request forms are used to document requests and related
projects.
Audit procedures:
Identify recent software modification and determine whether change
request forms were used.
Control activities:
AS-3.4 Authorizations for changes are documented and maintained.
Control techniques:
AS-3.4.2 Change requests must be approved by both system users and IT
staff.
Audit procedures:
Examine a selection of software change request forms for approval.
Control activities:
AS-3.5 Changes are controlled as programs progress through testing to
final approval.
Control techniques:
AS-3.5.1 Test plan standards have been developed for all levels of
testing that define responsibilities for each party (e.g., users,
system analysis, programmers, auditors, quality assurance, library
control).
Audit procedures:
Review test plan standards.
Control activities:
AS-3.5 Changes are controlled as programs progress through testing to
final approval.
Control techniques:
AS-3.5.2 Detailed system specifications are prepared by the programmer
and reviewed by a programming supervisor.
AS-3.5.3 Software changes are documented so that hey can be traced from
authorization to the final approved code.
AS-3.5.4 Test plans are documented and approved that define
responsibilities for each party involved.
AS-3.5.5 Unit, integration, and system testing are performed and
approved:
* in accordance with the test plan and;
* applying a sufficient range of valid and invalid conditions.
Audit procedures:
Examine a selection of recent software changes and:
* review specifications;
* trace changes from code to design specifications;
* review test plans;
* compare test documentation with related test plans;
* analyze test failures to determine if they indicate ineffective
software testing;
* review test transactions and data;
* review test results;
* verify user acceptance; and;
* review updated documentation.
Control activities:
AS-3.5 Changes are controlled as programs progress through testing to
final approval.
Control techniques:
AS-3.5.6 A comprehensive set of test transactions and data is developed
that represents the various activities and conditions that will be
encountered in processing.
AS-3.5.7 Test results are reviewed and documented.
AS-3.5.8 Program changes are moved into production only upon documented
approval from users and system development management.
AS-3.5.9 Documentation is updated when a new or modified system is
implemented.
Audit procedures:
Determine whether operational systems experience a high number of
abends and if so, whether they indicate inadequate testing prior to
timplementation.
Control activities:
AS-3.6 Access to program libraries is restricted.
Control techniques:
AS-3.6.1 Separate libraries are maintained for program development and
maintenance, testing, and production programs.
AS-3.6.2 Source code is maintained in a separate library.
AS-3.6.3 Access to all programs, including production code, source
code, and extra program copies are protected by access control software
and operating system features.
Audit procedures:
Examine libraries in use. Verify source code exists for a selection of
production code modules by (1) comparing compile dates, (2) recompiling
the source modules, and (3) comparing the resulting module size to
production load module size. For critical software production programs,
determine whether access control software rules are clearly defined.
Test access to program libraries by examining security system
parameters.
Control activities:
AS-3.7 Movement of programs and data among libraries is controlled.
Control techniques:
AS-3.7.1 A group independent of the user and programmers control
movement of programs and data among libraries. Before and after images
of program code are maintained and compared to ensure that only
approved changes are made.
Audit procedures:
Review pertinent policies and procedures. For a selection of program
changes, examine related documentation to verify that:
* procedures for authorizing movement among libraries were followed,
and;
* before and after images were compared.
Control activities:
AS-3.8 Access to application activities/transactions is controlled via
user roles (access privileges).
Control techniques:
AS-3.8.1 User accounts are assigned to a role in the application. Roles
are designed and approved by management to provide appropriate access
and prevent an unauthorized user from executing critical transactions
in production that change application functionality.
Audit procedures:
Inspect system reports and identify users who have access to
configuration transactions. For a sample of users identified above,
inspect user authorization forms to determine whether the user's access
was authorized.
Control activities:
AS-3.9 Access to all application programs/codes and tables are
controlled.
Control techniques:
AS-3.9.1 Changes to application programs, codes and tables are either
restricted or denied in the production environment. All changes are
made using the approved change control process. User access to the
application programs, codes, and tables is provided only for emergency
user IDs.
Audit procedures:
Through inquiry and inspection, identify key programs and tables for
the application. Inspect system reports of users with access to the key
programs, codes and tables. Select a sample of users that have access
to the identified programs and tables. Inspect documentation supporting
how the access was provided. Note exceptions.
Control activities:
AS-3.10 Access to administration (system) transactions that provide
access to table maintenance and program execution is limited to key
users.
Control techniques:
AS-3.10.1 Security design includes consideration for sensitive
administration (system) transactions and restricted user access to
these transactions.
Audit procedures:
Inspect policies and procedures regarding restricted access to system
administration transactions. Through inquiry and inspection, identify
the system administration transactions. Inspect system reports of user
access to these transactions. Select a sample of users with
administration access and inspect documentation to determine whether
access was authorized. Select a sample of system administration
transactions executed by the system users and inspect resulting changes
to the system elements, such as the program code or table. Inspect
critical or privileged IDs (e.g., fire call ID) to determine if
activity is logged.
Control activities:
AS-3.11 Access and changes to programs and data are monitored.
Control techniques:
AS-3.11.1 Procedures are established to reasonably assure that key
program and table changes are monitored by a responsible individual who
does not have the change authority. The procedures provide the details
of reports/logs to run, specific valuation criteria and frequency of
the assessment.
Audit procedures:
Inspect documented procedures related to monitoring change control.
Select a sample of reports or logs that are reviewed, and inspect to
note evidence of monitoring compliance.
Control activities:
AS-3.12 Changes are assessed periodically.
Control techniques:
AS-3.12.1 Periodic assessment of compliance with change management
process, and changes to configurable objects and programs.
Audit procedures:
Inspect evidence of documented assessments performed. Determine who
performed the assessment and note the exception handling procedures.
Control activities:
AS-3.13 Applications are updated on a timely manner to protect against
known vulnerabilities.
Control techniques:
AS-3.13.1 The entity follows an effective process to identify
vulnerabilities in applications and update them.
Audit procedures:
Determine whether vendor supplied updates have been implemented. Assess
management�s process for identifying vulnerabilities and updating
applications.
Control activities:
AS-3.14 Emergency application changes are properly documented, tested,
and approved.
Control techniques:
AS-3.14.1 The entity follows an effective process to properly document,
test, and approve emergency changes.
Audit procedures:
Inspect evidence of proper documentation, testing, and approval of
emergency changes.
Source: GAO.
[End of table]
Critical Element � AS-4: Segregate user access to conflicting
transactions and activities and monitor segregation:
Effective segregation of duties is designed to prevent the possibility
that a single person could be responsible for diverse and critical
functions in such a way that errors or misappropriations could occur
and not be detected in a timely manner, in the normal course of
business processes. Although segregation of duties alone will not
adequately assure that only authorized activities occur, inadequate
segregation of duties increases the risk that erroneous or fraudulent
transactions could be processed, improper program changes implemented,
and computer resources damaged or destroyed. As discussed in AS-1, the
security plan should address the organization-wide policy on
segregation of duties (segregation of duty) and management should
organize the user departments to achieve adequate segregation of
duties. As part of this process, most organizations adopt segregation
of duties control matrices as a guideline of the job responsibilities
that should not be combined. It is important for the auditor to assess
the relationship among various job functions, responsibilities and
authorities in assessing adequate segregation of duties. The auditor
starts this assessment with the review of the control matrices defined
by management. Several automated tools are available to dynamically
manage segregation of duty conflicts within an application. Appropriate
business rules are critical to the effective implementation of these
tools.
Entity management should consider the organization structure and roles
in determining the appropriate controls for the relevant environment.
For example, an organization may not have all the positions described
in the segregation of duties matrix, or one person may be responsible
for more than one of the roles described. Based on the organizational
resource limitation and risk management, certain levels of segregation
of duty conflicts may be allowed by management for a select role or
users. If so, management should have appropriate compensating controls
in place to mitigate the risks of allowing the conflicts.
Appropriate segregation of duties often presents difficulties in
smaller organizations. Even entities or locations that have only a few
employees, however, can usually divide their responsibilities to
achieve the necessary checks and balances. More often than not, the
auditor will encounter situations where a few to substantial number of
users may have access to activities with segregation of duty conflicts.
Management generally mitigates the risks of allowing the segregation of
duty conflicts by adding compensatory controls, such as approval of
transactions before they are entered in the application or review of
the posted transactions or reports as direct oversight and close
monitoring of the incompatible activities. Typically, a combination of
access and monitoring controls is necessary for design and operational
effectiveness.
Compensating controls are internal controls that are intended to reduce
the risk of an existing or potential control weakness when duties
cannot be appropriately segregated. Compensating controls for
segregation of duties conflicts generally include additional monitoring
and supervision of the activities performed by the individual
possessing conflicting responsibilities, and may include an additional
level of required approval. The segregation of duty conflicts are
mitigated to reduce or eliminate business risks through the
identification of compensating controls.
Effective segregation of duties, consistent with Section 3.4,
Segregation of Duties (SD), includes the following steps:
* Segregate user access to conflicting transactions and activities;
* Monitor user access to conflicting transactions and activities
through formal operating procedures, supervision, and review.
Table 42. Control Techniques and Suggested Audit Procedures For
Critical Element AS-4 - Segregate user access to conflicting
transactions and activities and monitor segregation:
Control activities:
AS-4.1 Incompatible activities and transactions are identified.
Control techniques:
AS-4.1.1 Owners have identified incompatible activities and
transactions, and documented them on a segregation of duty matrix.
Owners have appropriately considered risk acceptance when allowing
segregation of duty conflicts in user roles.
Audit procedures:
Through inquiry of management and inspection of policies and
procedures, understand how management identifies incompatible
activities and transactions. Inspect list of segregation of duty
conflicts to determine whether management has identified the
segregation of duty conflicts appropriate for the business process and
considered risk acceptance when allowing the conflicts.
Control activities:
AS-4.2 Application controls prevent users from performing incompatible
duties.
Control techniques:
AS-4.2.1 Users are prevented by the application from executing
incompatible transactions, as authorized by the business owners.
Audit procedures:
Through inquiry, observation, and inspection, determine how the
application segregates users from performing incompatible duties.
Obtain and inspect a listing of users with access to the application.
For a sample of users (can use same sample selected in AS-2.4.1, AS-
2.4.3 & AS-2.6.3), inspect documentation to determine whether access to
menus/ screens corresponds with the user's defined duties. Evaluate
whether their duties and access is appropriate to prevent employees
from performing incompatible duties. Specifically, perform the
following steps:
* Obtain a system-generated user listing for the application (and other
applications, if applicable);
* For a selected sample of users, inspect their access profiles to
determine whether access is appropriate (e.g., users have update
access); and;
* For the selected sample of users, inspect their access profiles to
determine if any of the users have access to menus with conflicting
duties.
Control activities:
AS-4.3.3 There is effective segregation of duties between the security
administration function of the application and the user functions.
Control techniques:
AS-4.3.1 The profiles for security administrators do not have
privileges to input and/or approve transactions.
Audit procedures:
Based on the inspection of user profiles, determine if:
* individuals with security administration functions have access to
input, process, or approve transactions;
* security administrators have access to more than application security
administration functions; and;
* security administrators are prevented from accessing production data.
Control activities:
AS-4.4 User access to transactions or activities that have segregation
of duties conflicts is appropriately controlled.
Control techniques:
AS-4.4.1 Owners authorize users to have access to transactions or
activities that cause segregation of duty conflicts only when supported
by a business need.
Audit procedures:
Inspect user administration policy to determine whether owner approval
is required to access transactions or activities in their area of
responsibility. Obtain and inspect a system report of users with
conflicting responsibilities within the application. Obtain a sample of
user access request forms (electronic documents/workflow, if
applicable) and verify that the owners have approved user access to
appropriate transactions or activities.
Control activities:
AS-4.4 User access to transactions or activities that have segregation
of duties conflicts is appropriately controlled.
Control techniques:
AS-4.4.2 Security Administrators review application user access
authorizations for segregation of duties conflicts and discuss any
questionable authorizations with owners.
Audit procedures:
Interview security administrators and observe and inspect relevant
procedures and documentation. If the security administrator's review is
documented on the request form, inspect a sample of forms to note
evidence of the security administrator's review.
Control activities:
AS-4.4 User access to transactions or activities that have segregation
of duties conflicts is appropriately controlled.
Control techniques:
AS-4.4.3 Owners periodically review access to identify unauthorized
segregation of duties conflicts and determine whether any authorized
segregation of duties conflicts remain appropriate.
Audit procedures:
Interview owners and inspect documentation; determine whether
appropriate procedures are in place to identify and remove or modify
access, as needed.
Control activities:
AS-4.5 Effective monitoring controls are in place to mitigate
segregation of duty risks.
Control techniques:
AS-4.5.1 Process Owner has identified the segregation of duty conflicts
that can exist, and the roles and users with conflicts.
Audit procedures:
Inspect documentation of roles and users with conflicts.
Control activities:
AS-4.5 Effective monitoring controls are in place to mitigate
segregation of duty risks.
Control techniques:
AS-4.5.2 Documented monitoring controls are in place that specifically
address the conflict that the control mitigates.
Audit procedures:
Identify segregation of duty conflicts (including those that were
intentionally established by the entity) and review documentation to
determine whether:
* monitoring controls adequately mitigate the risks created by the
segregation of duty conflict; and;
* monitoring controls are effective. This can be achieved by inspecting
the evidence collected by management.
Control activities:
AS-4.5 Effective monitoring controls are in place to mitigate
segregation of duty risks.
Control techniques:
AS-4.5.3 Management has documented evidence of monitoring of control
effectiveness.
Audit procedures:
Review evidence of monitoring of control effectiveness.
Source: GAO.
[End of table]
Critical Element � AS-5: Implement effective application contingency
planning:
Chapter 3 addresses Contingency Planning at an entitywide and system
level and is focused on the total information resources of an entity.
Audit steps for the following section should be performed in
conjunction with Chapter 3, which provides a more in-depth discussion
of contingency planning issues. FISMA requires that each federal agency
implement an information security program that includes �plans and
procedures to ensure continuity of operations for information systems
that support the operation and assets of the agency.� As shown in
Chapter 3, an entity should:
* Assess the criticality and sensitivity of computerized operations and
identify supporting resources;
* Take steps to prevent and minimize potential damage and interruption;
* Develop and document a comprehensive contingency plan;
* Periodically test the contingency plan and adjust it as appropriate.
OMB Circular A-130, Appendix III, requires contingency plans for major
applications, and NIST provides relevant guidance in Special
Publication 800-34, Contingency Planning Guide for Information
Technology Systems.[Footnote 92]
Assess the criticality and sensitivity of the application:
A key step in the contingency planning process is to conduct a Business
Impact Analysis (BIA) for the application under focus.[Footnote 93] The
NIST contingency planning guide presents a three-step BIA process,
which is discussed in Chapter 3 at the entitywide level. Following this
process, staff conducting the BIA should, first, determine the critical
functions performed by the application and then identify the specific
IT resources required to perform the functions. Invariably, critical IT
resources, in part, can include hardware and network components and
telecommunication connections, as well as key application data and
programs which should be backed up regularly. Second, staff should
identify disruption impacts and allowable outage times for the
application. And, third, staff should develop recovery priorities that
will help determine recovery strategies. The NIST guide provides a
range of recovery strategy considerations, including alternate sites of
varying operational readiness, reciprocal agreements with other
organizations, and service level agreements with equipment vendors.
Take steps to prevent and minimize potential damage and interruption:
The entity should implement policies and procedures to prevent or
minimize potential damage and interruption to critical systems,
including appropriate backup of application programs and data. Such
policies and procedures should be incorporated into the entity�s
entitywide contingency planning efforts.
Develop and document an application contingency plan:
A key step following the BIA, is to develop the application contingency
plan (which NIST refers to as an IT contingency plan) and incorporate
it into related plans. The NIST guide provides a discussion of various
related types of plans, but recognizes that universally accepted
definitions are not available, and the scope and purpose of a plan at
an organization may vary from the definition provided in the NIST
guide. The application contingency plan is focused on one application
and may address recovery procedures at an alternative site. However, it
probably will not address the recovery of a major processing facility
supporting multiple applications, nor the continuity or recovery of
business functions relying on multiple applications. Therefore, an
entity�s Disaster Recovery Plan for a major processing facility may
cover multiple applications and establish recovery priorities by
application. Likewise, an entity�s business functions involving
multiple applications may have Business Continuity and Recovery Plans
that incorporate multiple contingency plans for applications. It is
important that an application contingency plan be incorporated into
broader-scoped, related plans so that the application receives proper
priority among multiple applications. The application contingency plan
should also include time-based implementation procedures so that
recovery activities are performed in a logical sequence and reflect the
application�s allowable outage times to avoid significant impacts.
Contingency plans should include consideration of alternate work sites.
No application contingency plan could be activated without the
availability of key data and programs. Therefore, application data
should be backed up regularly and current programs should be copied and
available for use. Both should be safeguarded, stored offsite, and be
retrievable when recovery actions are implemented. The NIST guide
provides a discussion of backup methods and considerations.
The entity should prevent and minimize potential damage and
interruption. Chapter 3 includes a discussion of steps as the
entitywide and system levels. In addition, for applications, the entity
should maintain appropriate backup of applications and application
data. Also, it is important that restarts process data completely and
accurately. Further, when an application contingency plan has been
activated, responsible contingency personnel should reasonably assure
that effective controls will restrict and monitor user access to
application data and programs during the contingency operation. If
adequate preparations have not been made or proper procedures are not
followed, the contingency plan activation could result in an
operational application with vulnerabilities that might allow
unauthorized access to data and programs. As examples, access control
software may not be started or allow default passwords, outdated
software lacking up to date patches and containing known weaknesses may
be activated, and logging of auditable events may not occur.
The control environment for the contingency operation should be similar
to the normal operation. In particular, access controls as specified in
the previous section AS-2 should be operating. That is, contingency
operations should provide for effective user identification and
authentication, proper authorization to perform sensitive transactions,
and a continuing audit and monitoring capability.
Periodically test the contingency plan and adjust it as appropriate:
Testing the application contingency plan is essential to ensure it will
function as intended when activated for an emergency. Testing can
reveal important weaknesses. Testing the contingency plan and making
adjustments as needed helps ensure the application will work when the
contingency plan is implemented for an actual emergency. The NIST
contingency planning guide recommends the following areas to be
addressed in a contingency test:
* System recovery on an alternate platform from backup media;
* Coordination among recovery teams;
* Internal and external connectivity;
* System performance using alternate equipment;
* Restoration of normal operations;
* Notification procedures.
NIST�s Handbook on Computer Security[Footnote 94] discusses various
degrees of contingency plan tests that could range from 1) a simple
accuracy review to determine that key personnel contacts are still
employed by the entity to 2) disaster simulations. On disaster
simulations, this Handbook states the following: �These tests provide
valuable information about flaws in the contingency plan and provide
practice for a real emergency. While they can be expensive, these tests
can also provide critical information that can be used to ensure the
continuity of important functions. In general, the more critical the
functions and the resources addressed in the contingency plan, the more
cost-beneficial it is to perform a disaster simulation.�
The NIST contingency planning guide states that test results and
lessons learned should be documented and reviewed. The guide further
states that, to be effective, the plan should be maintained in a ready
state that accurately reflects the system, requirements, procedures,
organizational structure, and policies and, therefore, the plan should
be reviewed and updated regularly, at least annually or whenever
significant changes occur.
Table 43. Control Techniques And Suggested Audit Procedures For
Critical Element AS-5 � Maintain an effective contingency planning
program:
Control activities:
AS-5.1 Assess the criticality and sensitivity of the application
through a Business Impact Analysis (BIA) or equivalent.
Control techniques:
AS-5.1.1 Determine the critical functions performed by the application
and identify the IT resources, including key data and programs,
required to perform them.
AS-5.1.2 Identify the disruption impacts and allowable outage times for
the application.
AS-5.1.3 Develop recovery priorities that will help determine recovery
strategies.
Audit procedures:
Review the policies and methodology, and the BIA (if conducted) used to
determine the application�s critical functions and supporting IT
resources, the outage impacts and allowable outage times, and the
recovery priorities. Interview program, information technology, and
security administration officials. Determine their input and assessment
of the reasonableness of the results.
Control activities:
AS-5.2 Take steps to prevent and minimize potential damage and
interruption.
Control techniques:
AS-5.2.1 Backup files of key application data are created on a
prescribed basis.
Audit procedures:
Review written policies and procedures for backing up and storing
application data and programs.
Control activities:
AS-5.2 Take steps to prevent and minimize potential damage and
interruption.
Control techniques:
AS-5.2.2 Current application programs are copied and available for use.
Audit procedures:
Examine the backup storage site.
Control activities:
AS-5.2 Take steps to prevent and minimize potential damage and
interruption.
Control techniques:
AS-5.2.3 Backup files of application data and programs are securely
stored offsite and retrievable for contingency plan implementation.
Audit procedures:
Interview program and information technology officials and determine
their assessment of the adequacy of backup policy and procedures.
Control activities:
AS-5.3 Develop and document an application Contingency Plan.
Control techniques:
AS-5.3.1 Develop a time-based application Contingency Plan.
Audit procedures:
Review the application contingency plan and broader scoped related
plans.
Control activities:
AS-5.3 Develop and document an application Contingency Plan.
Control techniques:
AS-5.3.2 Incorporate the application Contingency Plan into related
plans, such as the Disaster Recovery, Business Continuity, and Business
Resumption Plans.
Audit procedures:
Determine whether the broader-scoped plans have incorporated the
application contingency plan. Compare the plan with guidance provided
in NIST SP 800-34. Interview program, information technology, and
security administration officials and determine their input and
assessment of the reasonableness of the plan.
Control activities:
AS-5.3 Develop and document an application Contingency Plan.
Control techniques:
AS-5.3.3 Contingency operations provide for an effective control
environment by restricting and monitoring user access to application
data and programs, including:
* Users are identified and authenticated;
* Users are properly authorized before being able to perform sensitive
transactions;
* Audit and monitoring capabilities are operating.
Audit procedures:
Interview program, information technology, and security administration
officials. Determine their assessment for providing an effective
control environment during contingency operations. Review the
contingency plan and any test results for control related issues.
Control activities:
AS-5.4 Periodically test the application contingency plan and adjust it
as appropriate.
Control techniques:
AS-5.5.1 The application contingency plan is periodically tested and
test conditions include disaster simulations.
Audit procedures:
Review policies on testing. Determine when and how often contingency
plans are tested.
Control activities:
AS-5.4 Periodically test the application contingency plan and adjust it
as appropriate.
Control techniques:
AS-5.5.2 The following areas are included in the contingency test:
* System recovery on an alternate platform from backup media;
* Coordination among recovery teams;
* Internal and external connectivity;
* System performance using alternate equipment;
* Restoration of normal operations;
* Notification procedures.
Audit procedures:
Determine if technology is appropriately considered in periodic tests
of the contingency plan and resultant adjustments to the plan. Review
test results. Observe a disaster recovery test.
Control activities:
AS-5.4 Periodically test the application contingency plan and adjust it
as appropriate.
Control techniques:
AS-5.5.3 Test results are documented and a report, such as a lessons-
learned report, is developed and provided to senior management.
Audit procedures:
Review the final test report. Interview senior management to determine
whether they are aware of the test results.
Control activities:
AS-5.4 Periodically test the application contingency plan and adjust it
as appropriate.
Control techniques:
AS-5.5.4 The contingency plan and related agreements and preparations
are adjusted to correct any deficiencies identified during testing.
Audit procedures:
Review any documentation supporting contingency plan adjustments.
Source: GAO.
[End of table]
4.2. Business Process Controls (BP):
Business Process controls are the automated and/or manual controls
applied to business transaction flows and relate to the completeness,
accuracy, validity and confidentiality of transactions and data during
application processing. They typically cover the structure, policies,
and procedures that operate at a detailed business process (cycle or
transaction) level and operate over individual transactions or
activities across business processes. Specific types of business
process controls are:
* Transaction Data Input relates to controls over data that enter the
application (e.g., data validation and edit checks).
* Transaction Data Processing relates to controls over data integrity
within the application (e.g., review of transaction processing logs).
* Transaction Data Output relates to controls over data output and
distribution (e.g., output reconciliation and review).
* Master Data Setup and Maintenance relates to controls over master
data, the key information that is relatively constant and shared
between multiple functions or applications (e.g., vendor file).
The particular control techniques employed by an entity will depend on
the context of the business process and its associated risks and
objectives. Business process controls may be manual or automated.
Automated controls are system-based, and may be used to control such
things as the correctness or accuracy of data, such as edits and
validations. Manual controls are procedures that require human
intervention, such as the approval of a transaction, and are typically
used to assure the reasonableness or propriety of transactions.
Automated and manual controls can be preventive or detective. Automated
controls can keep invalid data from being processed, and they can
report transactions that fail to meet reasonableness criteria. Manual
controls performed prior to input can identify problems before data is
processed, while monitoring controls performed after processing can
identify errors.
In many entities, the core business processes span across multiple
applications. Some of the applications are themselves complex,
integrated systems. Ideally, applications are interfaced seamlessly for
the information to flow across these applications to complete a
business process. Furthermore, functional areas may expand outside of
the organization to include external �partners� as part of a larger
vendor/contract management or personnel management, wherein partner
applications are often interfaced with entity systems. This expansion
of the environment to include external systems adds to the risks or
challenges faced by the organization. If not properly controlled, these
interfaces with external �partners� can affect the confidentiality,
integrity, and availability of information and information systems.
At a high level, execution of a business process involves data input,
processing and data output. However, the characteristics of data types
(master or standing data and transaction data), and the complexity of
the interfaced systems and the underlying data management systems,
require the auditor to consider these in evaluating the completeness,
accuracy, validity and confidentiality of data.
Master Data vs. Transaction Data:
Every business process employs master data, or referential data that
provides the basis for ongoing business activities, e.g., customers,
vendors, and employees. The data that are generated as a result of
these activities are called transaction data, and represent the result
of the activity in the form of documents or postings, such as purchase
orders and obligations.
Examples of master data are:
* Organizational structure;
* G/L Account Structure;
* Vendor Master;
* Employee Master.
Financially focused master data generally has the following
characteristics:
* Relatively stable over time; even if the data records change, the
overall volume of growth is limited. Example: chart of accounts, fixed
assets, and vendors.
* Occur only once per object in the application. Example: assets are
used by almost every organizational unit, but there is only one master
record per asset.
* Everything else depends on them, e.g. inventory balances cannot be
loaded without the organizational structure, G/L accounts, and material
master being loaded. Therefore, master data should be loaded prior to
processing business transactions.
Business Process Control Objectives:
As discussed in the introduction to this chapter, the overall
objectives of business process application level controls are to
reasonably assure completeness, accuracy, validity and confidentiality
of transactions and data during application processing. In particular,
each specific business process control technique is designed to achieve
one or more of these objectives. The effectiveness of business process
controls depends on whether all of these overall objectives are
achieved by the application level controls. Each objective is described
in more detail below.
Completeness (C) controls should provide reasonable assurance that all
transactions that occurred are input into the system, accepted for
processing, processed once and only once by the system, and properly
included in output. Completeness controls include the following key
elements:
* transactions are completely input;
* valid transactions are accepted by the system;
* duplicate postings are rejected by the system;
* rejected transactions are identified, corrected and re-processed;
and;
* all transactions accepted by the system are processed completely.
The most common completeness controls in applications are batch totals,
sequence checking, matching, duplicate checking, reconciliations,
control totals and exception reporting.
Accuracy (A) controls should provide reasonable assurance that
transactions are properly recorded, with the correct amount/data, and
on a timely basis (in the proper period); key data elements input for
transactions are accurate; and data elements are processed accurately
by applications that produce reliable results; and output is accurate.
Accuracy control techniques include programmed edit checks (e.g.,
validations, reasonableness checks, dependency checks, existence
checks, format checks, mathematical accuracy, range checks, etc.),
batch totals and check digit verification.
Validity (V) controls should provide reasonable assurance (1)that all
recorded transactions actually occurred (are real), relate to the
organization, and were properly approved in accordance with
management�s authorization; and (2) that output contains only valid
data. A transaction is valid when it has been authorized (for example,
buying from a particular supplier) and when the master data relating to
that transaction is reliable (for example, the name, bank account and
other details on that supplier). Validity includes the concept of
authenticity. Examples of validity controls are one-for-one checking
and matching.
Confidentiality (CF) controls should provide reasonable assurance that
application data and reports and other output are protected against
unauthorized access. Examples of confidentiality controls include
restricted physical and logical access to sensitive business process
applications, data files, transactions, and output, and adequate
segregation of duties. Confidentiality also includes restricted access
to data reporting/extraction tools as well as copies or extractions of
data files.
NIST Guidance:
For federal systems, NIST SP 800-53 includes the following controls
related to business process controls:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling;
SI-12 Information Output Handling and Retention.
This section presents more detailed control objectives that should be
achieved to reasonably assure that transaction data is complete,
accurate, valid and confidential. Also, this section is organized to
address the four principal types of business process controls: input,
processing, output, and master files.
Business Process Control Critical Elements:
Business Process Controls have the following four critical elements:
BP-1 Transaction Data Input is complete, accurate, valid, and
confidential (Transaction data input controls);
BP-2 Transaction Data Processing is complete, accurate, valid, and
confidential (Transaction data processing controls);
BP-3 Transaction Data Output is complete, accurate, valid, and
confidential (Transaction data output controls);
BP-4 Master data setup and maintenance is adequately controlled.
BP-1 Transaction Data Input is complete, accurate, valid, and
confidential (Transaction Data Input Controls):
The entity should implement procedures to reasonably assure that (1)
all data input is done in a controlled manner, (2) data input into the
application is complete, accurate, and valid, (3) any incorrect
information is identified, rejected, and corrected for subsequent
processing, and (4) the confidentiality of data is adequately
protected. Inadequate input controls can result in incomplete,
inaccurate, and/or invalid records in the application data or
unauthorized disclosure of application data.
Applications can accept input manually (application users enter data),
or via automated input. The automated input may be interfaces that use
batch processing or are integrated real-time with internal and external
systems. To the extent that data input is obtained from other
applications, the auditor�s assessment of input controls should be
coordinated with data interface controls discussed in section 4.3 of
this chapter.
For federal systems, NIST SP 800-53 [SI-10] establishes the following
objectives for input controls:
* checks for accuracy, completeness, validity, and authenticity of
information are accomplished as close to the point of origin as
possible.
* rules for checking the valid syntax of information system inputs
(e.g., character set, length, numerical range, acceptable values) are
in place to verify that inputs match specified definitions for format
and content.
* inputs passed to interpreters are prescreened to prevent the content
from being unintentionally interpreted as commands.
Also, SI-10 states that the extent to which the information system is
able to check the accuracy, completeness, validity, and authenticity of
information is guided by organizational policy and operational
requirements.
Data input for processing should have all key fields completed and be
validated and edited. Error handling procedures should facilitate
timely resubmission of corrected data, including real-time on-line
edits and validations. These controls may be configured within the
system settings, or added on as a customization. Where applicable, the
auditor may also process a controlled group of live data and test for
expected results. Preventive controls generally allow for higher
reliance and the most efficient testing.
In addition, controls should be in place to reasonably assure that
access to data input is adequately controlled. Procedures should be
implemented to control access to application input routines and
physical input media (blank and completed). The assessment of such
controls should be coordinated with Critical Element AS-2 Implement
effective application access controls.
For federal systems, NIST SP 800-53 includes three controls relevant to
transaction data input:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
Data input controls are comprised of the following control activities:
* Implement an effective transaction data strategy and design;
* Establish input preparation (approval and review) policies and
procedures;
* Build data validations and edit checks into the application;
* Implement effective auditing and monitoring capability.
Implement an effective transaction data strategy and design:
The entity should have an appropriate data strategy and design (how the
data are organized into structures to facilitate retrieval while
minimizing redundancy). The design of transaction data elements is a
critical factor in helping to assure the quality of data as well as its
interrelationship with other data elements. Data standards [Footnote
95] should be defined and maintained, but may vary depending upon the
specific requirements of the entity, including regulatory requirements,
and database- or application-based standards.
A clearly defined data strategy minimizes data redundancies fundamental
to an efficient, effective transaction processing function. Poor data
quality may lead to a failure of system controls, process
inefficiencies, and inaccurate management reporting. Erroneous or
missing elements of critical data in the transaction file can produce
discrepancies within the process cycle.
Characteristics of erroneous transaction file data elements include,
but are not limited to, duplicate transactions recorded or processed,
and improper coding to departments, business units or accounts. They
also include unpopulated data fields and data formatting
inconsistencies, as described for the master file.
Establish Input Preparation (approval and review) Policies and
Procedures:
The entity should have policies and procedures in place to reasonably
assure that all authorized source documents and input files are
complete and accurate, properly accounted for, and transmitted in a
timely manner for input to the computer system. Among these, management
should establish procedures to reasonably assure that all inputs into
the application have been processed and accounted for; and any missing
or unaccounted for source documents or input transactions have been
identified and investigated. Finally, procedures should be established
to reasonably assure that all source documents (paper or electronic
form) have been entered and accepted to create a valid transaction.
Automatic input from other applications should be integrated either
through an interface (external applications) or configuration (cross-
modular within the same application). Interface controls are addressed
in section 4.3, below.
For federal systems, NIST SP 800-53 [SI-9] establishes a control
objective that the organization restricts the capability to input
information to the information system to authorized personnel.
Restrictions on personnel authorized to input information to the
information system may extend beyond the typical access controls
employed by the system and include limitations based on specific
operational/project responsibilities.
Build Data Validation and Edits within the Application:
Input data should be validated and edited to provide reasonable
assurance that erroneous data are prevented or detected before
processing. In many cases, application owners and programmers will
build application input edits directly into the application to limit
the number of errors that are input into the application. Edits are
used to help assure that data are complete, accurate, valid, and
recorded in the proper format. Edits can include programming to
identify and correct invalid field lengths or characters, missing data,
incorrect data, or erroneous dates. The auditor should obtain an
understanding of the application input edits to assess their adequacy
and to determine the edits that will be tested.
Implement Effective Auditing and Monitoring Capability:
As part of the data input process, data entry errors may occur. These
errors can occur during manual or automated entry of data. Management
should have procedures to identify and correct any errors that occur
during the data entry process. Error handling procedures during data
entry should reasonably assure that errors and irregularities are
detected, reported, and corrected. Management�s audit and monitoring
capability should include:
* user error logs to provide timely follow-up and correction of
unresolved data errors and irregularities, and;
* an established monitoring process to assure the effectiveness of
error handling procedures.
For federal systems, NIST SP 800-53 [SI-11] states that the information
system identifies and handles error conditions in an expeditious manner
without providing information that could be exploited by adversaries.
The structure and content of error messages are carefully considered by
the organization. Error messages are revealed only to authorized
personnel. Error messages generated by the information system provide
timely and useful information without revealing potentially harmful
information that could be used by adversaries. Sensitive information
(e.g., account numbers, social security numbers, and credit card
numbers) are not listed in error logs or associated administrative
messages. The extent to which the information system is able to
identify and handle error conditions is guided by organizational policy
and operational requirements.
Table 44. Control Techniques And Suggested Audit Procedures For
Critical Element BP-1 - Transaction Data Input is complete, accurate,
valid, and confidential:
Control activity:
BP-1.1 A transaction data strategy is properly defined, documented, and
appropriate.
Control Object:
C,A,V,CF;
Control techniques:
BP-1.1.1 Data management procedures exist that include transaction data
strategy, data design, data definitions, data quality standards,
ownership and monitoring procedures. Data strategy should be unique to
each data type.
Audit procedures:
Inquire of management and inspect documented policies and procedures
related to data strategy. Inspect transaction data strategy.
Control activity:
BP-1.2 Source documentation and input file data collection and input
preparation and entry is effectively controlled.
Control Object:
C,V,CF;
Control techniques:
BP-1.2.1 Procedures are established to provide reasonable assurance
that all inputs into the application have been authorized, accepted for
processing, and accounted for; and any missing or unaccounted for
source documents or input files have been identified and investigated.
Such procedures may include one or more of the following:
* batch totals;
* sequence checking;
* reconciliations;
* control totals.
Audit procedures:
Through inquiry, observation, and inspection, obtain an understanding
of policies and procedures related to source document and input file
collection and preparation, and determine whether the procedures are
documented and properly designed. Observe and inspect input preparation
policies and procedures and relevant controls, noting procedures taken
when exceptions are identified. Inspect a selection of reports (a
sample is not required, but the auditor could elect to choose one) used
by management to determine whether the necessary inputs are accepted
for processing, and inquire of review procedures used. Inquire as to
how source documents and input files are tracked and maintained and
inspect relevant documentation.
Control activity:
BP-1.3 Access to data input is adequately controlled;
Control Object:
C,A,V,CF;
Control techniques:
BP-1.3.1 Procedures are implemented to control access to application
input routines and physical input media (blank and completed).
Audit procedures:
Review procedures over control of data input to determine whether they
are adequate. Coordinate this step with AS-2.
Control activity:
BP-1.4 Input data are approved;
Control Object:
A,V;
Control techniques:
BP-1.4.1 Documented approval procedures exist to validate input data
before entering the system. Approval procedures are followed for data
input.
Audit procedures:
Inspect documented procedures for approval of input data. Inspect a
selection of source documents (a sample is not required, but auditor
could elect to choose one) and input files and determine whether the
source data were approved for input.
Control activity:
BP-1.5 Input data are validated and edited to provide reasonable
assurance that erroneous data are detected before processing.
Control Object:
A,V;
Control techniques:
BP-1.5.1 Appropriate edits are used to reasonably assure that data are
valid and recorded in the proper format, including:
* authorization or approval codes;
* field format controls;
* required field controls;
* limit and reasonableness controls;
* valid combination of related data field values;
* range checks;
* mathematical accuracy;
* master file matching;
* duplicate processing controls; and;
* balancing controls.
Audit procedures:
Through inquiry, observation, and inspection, understand edits used to
reasonably assure that input data is accurate, valid, and in the proper
format prior to being accepted by the application. The edits and
procedures should address both manual and automated input processes.
Identify the key data input screens. Consider such factors as known
errors and the frequency of use. If available, use analytical reports
to support reasoning for screen selection. For the key manual input
layouts identified, perform the following steps as applicable:
* Observe an authorized data entry clerk inputting transactions, noting
edits and validations for the various transaction entries.
* Observe key transaction fields to determine whether they have
adequate edit/validation controls over data input.
* Obtain screen prints of appropriate scenarios and document the
result.
For key automated inputs, observe and inspect data validation
processes, completion controls, and exception reports in place. Inquire
of management regarding procedures used to reject and resubmit data for
processing, and procedures to provide reasonable assurance that data is
not processed multiple times. Note: audit procedures apply only to the
current environment at the time of test. Supplemental audit procedures
would need to be applied at other points during the year to obtain
evidence that the control was operating effectively.)
Control activity:
BP-1.5 Input data are validated and edited to provide reasonable
assurance that erroneous data are detected before processing.
Control Object:
A,V;
Control techniques:
BP-1.5.2 Edit and validation overrides are restricted to authorized
personnel. Procedures exist to monitor, in a timely manner, overrides
applied to transactions.
Audit procedures:
Observe and inspect existing procedures for reviewer overrides or
bypassing data validation and error routines. If an override log
exists, observe and inspect to determining whether adequate review and
follow up of overrides is performed. Inspect a selection of overrides
for evidence of proper approval. (Note: use of overrides is not by
itself indicative of inadequate controls. However, the auditor needs to
examine why the overrides are being used and controls in place to
minimize risks from these actions).
Control activity:
BP-1.5 Input data are validated and edited to provide reasonable
assurance that erroneous data are detected before processing.
Control Object:
A,V;
Control techniques:
BP-1.5.3 Table maintenance procedures include edit and validation
controls to help assure that only valid changes are made to data
tables.
Audit procedures:
Through inquiry, observation, and inspection, obtain an understanding
of table maintenance procedures relative to data edits and validation.
Observe an authorized person attempting to make invalid changes to
tables, and confirm edits and validations are performed on changes.
Control activity:
BP-1.6 Input values to data fields that do not fall within the
tolerances or parameters determined by the management result in an
input warning or error.
Control Object:
A,V;
Control techniques:
BP-1.6.1 Parameters and tolerances are configured and error conditions
and messages are defined. (These restrictions can be configured based
on limits on transaction amounts or based on the nature of
transactions) If a workflow is used so that documents can be released
only by personnel with appropriate approval authority, then these
requirements should be appropriately designed in the system. Management
regularly reviews the restrictions placed on data input and validates
that they are accurate and appropriate.
Audit procedures:
Inspect configuration of parameters and tolerance levels defined by the
entity to identify whether the application accepts the data with
warning or rejects the data, if the conditions are not met. Inspect
management review procedures, if the application accepts user data,
with a warning. Inspect the workflow rules and validate that the
releasing authority is at an appropriate level. Inspect evidence of
management's regular review of relevant tolerances and parameters, and
any correctional activities taken.
Control activity:
BP-1.7 Error handling procedures during data origination and entry
reasonably assure that errors and irregularities are detected,
reported, and corrected.
Control Object:
C,A,V;
Control techniques:
BP-1.7.1 Procedures are established to reasonably assure that all
inputs into the application have been accepted for processing and
accounted for; and any missing or unaccounted for source documents or
input files have been identified and investigated. The procedures
specifically require the exceptions to be resolved within a specific
time period.
Audit procedures:
Inspect documented procedures related to data entry error handling
procedures. Inquire of management to determine which key management
reports are used to monitor input errors. Select a sample of input
error reports and inspect to note evidence of management review. As
applicable, inspect subsequent data input reports to note where data
was corrected and resubmitted for processing.
Control activity:
BP-1.8 Errors are investigated and resubmitted for processing promptly
and accurately.
Control Object:
C,A,V;
Control techniques:
BP-1.8.1 Data input errors are identified in suspense or error reports
and resolved or resubmitted in a timely manner (within the period
specified in the procedures).
Audit procedures:
Inspect a sample of recent suspense or error reports (can use sample
selected in BP-1.7.1 provided information included will satisfy audit
objectives for both audit procedures) and note whether suspense items
are being corrected in a timely manner. Inspect the open items and note
management's reasons for not correcting them in a timely manner.
Source: GAO.
[End of table]
BP-2 Transaction Data Processing is complete, accurate, valid, and
confidential (Transaction Data Processing Controls):
Transaction data processing controls address the completeness,
accuracy, validity, and confidentiality of data as the data get
processed within the application. Data processing controls are employed
following input, or during batch processing or on-line user processing
within the application.
Once the initial data are entered in the system and accepted for
processing, the processing of the data should be controlled by a series
of activities within the system. These activities are designed by
management and are either programmed or configured into the
application. The processing steps are different for each process
(purchasing versus invoice processing) and control requirements differ
to mitigate the risks inherent to the applicable process. An effective
assessment of data processing controls includes an understanding of the
process steps and dataflow in a process cycle, the controls imbedded in
the application, and the manual controls that are common across
processes or specific to each process.
Some applications may allow user-defined processing, whereby the user
may establish or modify processing. This frequently occurs in
applications based on spreadsheets and report writer/data extraction
tools. Entities should establish clear policies and procedures
concerning user-defined processing. In addition, the entity should have
adequate controls over the accuracy, completeness and validity of
information processed in applications with user-defined processing.
Audit trails and security reports should be monitored on a regular
basis to help assure that transactions are processing as intended. The
effectiveness of such procedures depends on the level of security
reporting and problem analysis tools available in the application.
Controls over the processing of data should preclude or detect the
erroneous or unauthorized addition, removal, or alteration of data
during processing.
Interface controls relate to the integrity of data as they move from
one system to another. Interface controls are addressed separately in
Section 4.3 below.
For federal systems, as noted in BP-1 above, NIST SP 800-53 includes
three controls relevant to data processing:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
Formal Transaction Processing Procedures:
Formal procedures should be established for data processing to help
assure that data are processed completely and accurately, that data
retains its validity, and that appropriate data confidentiality is
maintained during processing. Related controls include the following:
* Transaction or table logs provide an audit trail and the ability to
compare transactions to source documents. Audit trails or processing
logs are often used within applications to track the pertinent
information related to application transactions, both manual and
automated. The processing logs should also be used to identify those
transactions that did not process completely or correctly within the
application. The log should document the errors identified during
application processing, and should contain enough information for the
systems personnel to identify the exact transactions that failed, and
the application users that will need to be contacted to correct the
posting (if the error can not be corrected by the systems personnel).
Processing logs typically contain such information as date and time of
error, responsible user (if applicable), codes describing the type of
error encountered, and the corrective action that has occurred to
assure correct processing of the transaction.
* An automated process exists that allows one or more of the following:
capturing transaction data in correct accounts; unique documentation;
tolerances in processing data; periodic review and reconciliation of
subsidiary or clearing accounts (e.g., clearing Goods Received accounts
against Invoice Received accounts through two- and three-way matching
process); prevention of direct posting to reconciliation accounts; and
workflow to initiate the approval process.
* Efficient transaction entry that eliminates unnecessary duplication
of data entry. Where appropriate, data needed by the systems are
entered only once and other parts of the system are automatically
updated consistent with the timing requirements of each process cycle.
* Managers should provide review and authorization for transactions
that are rejected and should be rerun.
Effective auditing and monitoring capability:
During data processing, transactions may not be processed completely or
accurately as a result of errors or inconsistencies in data, system
interruptions, communication failures, or other events. In addition,
valid data may be corrupted or data may lose its confidentiality. To
identify these instances, a monitoring capability should be
implemented. The monitoring function should reasonably assure that data
are accurately processed through the application and that processing
procedures determine data to be added, or altered during processing. No
data should be lost during the process. Controls may include:
* If the application is �run� on a regular schedule to process data,
either manually or automatically, there are documented procedures
explaining how this is performed, including controls in place to
reasonably assure that all processing was completed.
* A processing log is maintained and is reviewed on a regular basis for
unusual or unauthorized activity.
* The processing log, or another log or report, is used to document any
errors or problems encountered during processing. Types of information
that should be considered for retention are descriptions of any errors
encountered, dates identified, any codes associated with errors, any
corrective action taken, date and times corrected.
* Controls to reasonably assure that the correct generation/cycle of
files is used for processing. This may include the generation of backup
files from processing to be used for disaster recovery.
* Adequate audit trails are generated during processing. These audit
trails should be logs or reports that contain information about each
transaction. Data that should be included are who initiated each of the
transactions, the date and time of the transactions, and the location
of the transaction origination (terminal or IP address as an example).
Table 45. Control Techniques And Suggested Audit Procedures For
Critical Element BP-2 Transaction Data Processing is complete,
accurate, valid, and confidential:
Control activity:
BP2.1 Application functionality is designed to process input data, with
minimal manual intervention.
Control Object:
C,A,V,CF;
Control techniques:
BP-2.1.1 Application processing of input data is automated and
standardized. Design documentation supporting the processing design
exists for validation and change control purposes. The version of
application, data and files to be processed are appropriate and
current.
Audit procedures:
Inspect configuration and/or design documentation noting automatic and
manual processing of transaction and information flow. Verify that
proper versions of application, data and file are used.
Control activity:
BP-2.2 Processing errors are identified, logged and resolved.
Control Object:
C,A,V;
Control techniques:
BP-2.2.1 System entries use transaction logs to reasonably assure that
all transactions are properly processed and identify the transactions
that were not completely processed.
BP-2.2.2 Procedures are in place to identify and review the incomplete
execution of transactions, analyze and take appropriate action.
BP-2.2.3 Procedures exist to monitor, in a timely manner, overrides
applied to transaction processing.
Audit procedures:
Inspect a selection of application, transaction and error logs, noting
whether all transactions were properly processed and missing or
duplicate transactions were identified, including reruns and restarts.
Inspect selected incomplete transactions and validate that management
has adequately investigated and corrected the errors or omissions.
Conduct a test with controlled group of live data and analyze the
results with the expected values. Follow up with any exceptions.
Observe and inspect existing procedures for reviewer overrides or
bypassing data processing routines. If an override log exists, observe
and inspect to determining whether adequate review and follow up of
overrides is performed. Inspect a selection of overrides for evidence
of proper approval. (Note: use of overrides is not by itself indicative
of inadequate controls. However, the auditor needs to examine why the
overrides are being used and controls in place to minimize risks from
these actions).
Control activity:
BP-2.3 Transactions are executed in accordance with the pre-determined
parameters and tolerances, specific to entity�s risk management.
Control Object:
A,V;
Control techniques:
BP-2.3.1 Document processing and posting conditions (parameters and
tolerances) are configured, including system errors and actions, if the
are conditions are not met.
BP-2.3.2 Management regularly reviews the restrictions to validate the
accuracy and appropriateness.
Audit procedures:
Inspect configuration of parameters and tolerances levels defined by
the entity to identify whether the application processes the data with
warning or rejects the data, if the conditions are not met. Inspect
management review procedures, noting management action when the
application processes data or rejects it. In both cases, management
should clearly analyze the impact on the downstream transactions.
Control activity:
BP-2.4 Transactions are valid and are unique (not duplicated).
Control Object:
A,V;
Control techniques:
BP-2.4.1 The application performs on-line edit and validation checks
against data being processed.
BP-2.4.2 The system produces warning or error messages.
BP-2.4.3 Transactions with errors are rejected or suspended from
processing until the error is corrected.
BP-2.4.4 The application communicates the processing error to the Users
either on-line (if on-line entry) or via an exception report.
Audit procedures:
Inspect design document to identify key data validation and edit
checks. Inspect configuration to verify that the identified edit and
validations checks are appropriately set, and transactions are
rejected/suspended when data/processing errors occur. Also verify that
warning and error messages are designed when the processing is
incomplete. Inspect the error communication methodology.
Control activity:
BP-2.5 The transactions appropriately authorized.
Control Object:
A,V;
Control techniques:
BP-2.5.1 Transactions are matched with management�s general or specific
authorizations.
Audit procedures:
Review the adequacy of controls over authorization of transactions.
Control activity:
BP-2.6 Data from subsidiary ledgers are in balance with the general
ledger (step applicable to financial-related audits only).
Control Object:
C,A,V;
Control techniques:
BP-2.6.1 Periodic reconciliation is performed and exceptions are
appropriately handled.
Audit procedures:
Inspect periodic procedures to determine whether reconciliations are
performed and documented with evidence. For a selection of
reconciliations, examine supporting evidence for adequacy. Through
inquiry, observations, and inspection, determine if the system is
configured to auto balance, where possible.
Control activity:
BP-2.7 User-defined processing is adequately controlled.
Control Object:
C, A, V, CF;
Control techniques:
BP-2.7.1 Appropriate policies and procedures over user-defined
processing are implemented.
BP-2.7.2 Controls over user-defined processing are adequate.
Audit procedures:
Review policies and procedures over user-defined processing. Assess the
operating effectiveness of user-defined processing.
Control activity:
BP-2.8 As appropriate, the confidentiality of transaction data during
processing is adequately controlled;
Control Object:
CF;
Control techniques:
BP-2.8.1 Management implements adequate controls to protect the
confidentiality of data during processing, as appropriate.
Audit procedures:
Assess the adequacy of management controls over confidentiality during
processing. Coordinate this step with Critical Element AS-2 Implement
effective application access controls.
Control activity:
BP-2.9 An adequate audit and monitoring capability is implemented.
Control Object:
C,A;
Control techniques:
BP-2.9.1 Management has procedures in place to reconcile the data input
with the data processed by the application.
BP-2.9.2 Monitoring procedures should provide details of data to be
added/modified during the processing, and expected result. System audit
logs should be reviewed for exception.
BP-2.9.3 Management maintains a process log and the log is reviewed for
unusual or unauthorized activity.
Audit procedures:
Inspect procedures regarding reconciliation of transactions. Inspect
operations activity at selected times and check for evidence that
reconciliations are being performed. Inspect the processing log and
note whether the unusual or unauthorized activity was followed up
properly and promptly.
Source: GAO.
[End of table]
BP-3 Transaction data output is complete, accurate, valid, and
confidential (Transaction Data Output Controls):
Like input and processing controls, transaction data output controls
are used to reasonably assure that transaction data is complete,
accurate, valid, and confidential. In addition, output controls are
aimed at the correct and timely distribution of any output produced.
Output can be in hardcopy form, in the form of files used as input to
other systems, or information available for online viewing.
Formal procedures should be established for data processing to help
assure that data are processed completely and accurately, that data
retains its validity, and that appropriate data confidentiality is
maintained during processing.
Formal procedures should be established for data processing to help
assure that data are processed completely and accurately, that data
retains its validity, and that appropriate data confidentiality is
maintained during processing, output control totals are accurate and
are being verified, and the resulting information is distributed in a
timely and consistent manner to the appropriate end users. Controls
include:
* An overall reporting process that identifies specific output that
will be generated, the form and content of the reporting, sensitivity
of information and selectivity of user.
- Output is delivered to the appropriate end user.
- Output is restricted from unauthorized access.
- Record retention and backup schedules for output data should be
established.
* Data integrity through reconciliation of the output to the input and
processing data.
- Documented procedures explain the methods for the proper
balancing/reconciliation and error correcting of output should exist.
There should be adequate separation of duties for the
balancing/reconciliation process.
- Output is reviewed for general acceptability and completeness,
including any control totals. There should be either error reports or a
log kept of output errors. These should contain information such as a
description of problems/errors and the date identified, as well as any
corrective action taken.
In addition, controls should be in place to reasonably assure that
access to data output is adequately controlled. Procedures should be
implemented to control access to output data and physical output media
(blank and completed). The assessment of such controls should be
coordinated with Critical Element AS-2 Implement effective application
access controls.
For federal systems, as noted in BP-1 above, NIST SP 800-53 includes
three controls relevant to data output controls:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
In addition, NIST SP 800-53 [SI-12] states that the organization
handles and retains output from the information system in accordance
with applicable laws, Executive Orders, directives, policies,
regulations, standards, and operational requirements.
Implementing a reporting strategy:
One of the key elements of output controls is having an overall
reporting strategy. The strategy helps to reasonably assure that
content and availability of reports is consistent with end users�
needs, that end users are aware of the sensitivity and confidentiality
of data, and that an �owner� has been defined for all report output.
The strategy also provides a basis for policies and procedures that
govern preferred report methods (hardcopy vs. soft, standard vs.
custom), report generation and distribution, and any review and or
approvals.
The strategy should specifically consider:
* Compliance with laws and regulations;
* Sensitivity of data;
* Levels of reporting segregation of duties;
* Consolidation/processing of reporting from a 3rd party;
* Reporting tools utilized;
* Business needs/functionality of reports; and;
* Non-standard output items.
The strategy should adequately consider the confidentiality of all
types of output. For example, the entity should have adequate security
over output queues, particularly for sensitive information.
Inadequately secured output queues can lead to unauthorized disclosure
of information. Similarly, access to output screens should be
adequately controlled.
Another significant area for output controls relates to data that is
routinely or episodically transferred to other systems, such as data
supporting a management reporting system. If controls over such other
systems are not adequate and consistent with the risk level of the
data, such data may be subject to unauthorized across. For example,
personnel data transferred to a management reporting system should have
adequate controls to achieve the confidentiality and integrity
objectives.
Establishing security and controls over report generation and
distribution:
Controls over report generation and distribution should include the
following:
* Reports should be reviewed for reasonableness and accuracy prior to
distribution.
* Output distribution should be controlled so that output is provided
to authorized recipients only and on a timely basis.
* Report retention should be adequate based on internal needs and
regulatory requirements. For example, application output may be stored
to back-up tapes (or kept as hard copy documentation) and rotated to an
offsite storage facility.
* Output reports comply with applicable laws and regulations, including
the type of clearance required to view the output reports.
* User access to reports is controlled based on the user�s business
need to view the report and the sensitivity of information contained in
the report.
* Data output to management reporting or other copies of output files
are adequately controlled.
Table 46. Control Techniques And Suggested Audit Procedures For
Critical Element BP-3 Transaction data output is complete, accurate,
valid, and confidential:
Control activity:
BP-3.1 Outputs are appropriately defined by the management (form,
sensitivity of data, user selectivity, confidentiality, etc);
Control Object:
C,A,V,CF;
Control techniques:
BP-3.1.1 Management has developed a reporting strategy that includes
the following:
* content and availability that are consistent with end users� needs;
* sensitivity and confidentiality of data;
* appropriate user access to output data.
Audit procedures:
Inquire of management about a reporting strategy or policy. Obtain a
copy of any formal reporting strategy or policy. Assess the adequacy of
the strategy and related policies.
Control activity:
BP-3.2 Output generation and distribution are aligned with the
reporting strategy;
Control Object:
C,A,V,CF;
Control techniques:
BP-3.2.1 Management has procedures in place to reasonably assure that
content and availability of output and data are consistent with end
users� needs, sensitivity, laws and regulations, and confidentiality of
data and valid user access.
BP-3.2.2 Management has procedures in place to monitor replication of
output data used in management reports or other communications within
or outside the entity.
BP-3.2.3 User access to output data is aligned with the user's role and
confidentiality/sensitivity of information.
Audit procedures:
Inspect management procedures for defining and assigning
output/reports. Select key output/reports in the area of audit scope
and verify the user access to the output/reports. Inquire of management
on the use of data output. Inspect selected management reports or other
communication to verify the accurate replication of data. Verify that
the user received appropriate authorization to use the data. Review
user access to selected output data and assess the appropriateness of
access.
Control activity:
BP-3.3 System generated outputs/reports are reviewed to reasonably
assure the integrity of production data and transaction processing;
Control Object:
C,A,V;
Control techniques:
BP-3.3.1 Management has identified key reports to track processing
results.
BP-3.3.2 Management has documented procedures to review processed
results, where applicable.
BP-3.3.3 Procedures are in place to review critical output data or
control reports on a timely basis.
Audit procedures:
Inquire of user management and personnel to determine the key reports
used to track processing results. Obtain and inspect reports identified
by management in the above test to determine whether the reports exist
and are reviewed on a timely basis.
Control activity:
BP-3.4 Output/reports are in compliance with applicable laws and
regulations;
Control Object:
C,A,V,CF;
Control techniques:
BP-3.4.1 Output reports for compliance with applicable laws and
regulations are accurate, complete Inspect a sample of output/reports
for compliance with applicable laws and regulations.
Audit procedures:
Identify laws and regulations that are to be complied with and verify
that the reports are in compliance.
Control activity:
BP-3.5 Access to output/reports and output files is based on business
need and is limited to authorized users;
Control Object:
CF;
Control techniques:
BP-3.5.1 Access to reports is restricted to those users with a
legitimate business need for the information.
BP-3.5.2 Users should have appropriate authorization for accessing
reports, including the appropriate level of security clearance, where
applicable.
Audit procedures:
Select output/reports and output files from the audit area and inspect
application access (if the output can be accessed on-line or other
electronic form) or inspect distribution to determine whether the user
has appropriate level of security clearance and is authorized to
access.
Source: GAO.
[End of table]
BP-4 Master Data Setup and Maintenance is Adequately Controlled:
Master data are the key information that is constant and shared with
multiple functions, such as a customer master record, which contains
the customer number, shipping address, billing address, key contact and
payment terms. Most applications use the following two types of master
data:
Configurable master data or business rules are defined in an
application module and used by end users, but cannot be changed
directly in production. Purchase order release procedures (requiring
approval) and payment terms are examples of business rules.
Business master data are master data created in production based upon
the criteria designed to capture essential standing data, for example,
customer and vendor master data.
Master data are, usually, entered once and are shared among various
application modules. Also, common data fields that are used from origin
may be used by the application several times over a period of time
until the master data is no longer valid because of termination of a
contractual agreement or data owner decision.
Three key control areas specific to master data controls are the
controls related to design and configuration of master data
(preventive), the procedures external to the system (detective and
preventive), and the monitoring of master data design compliance
(detective). Master data is also subject to access controls (activities
to create and maintain master data are controlled by access privileges)
discussed in AS-2.
The three key steps in master file setup and maintenance are:
* Implementing an effective design of master data elements;
* Establishing master data maintenance procedures, including approval,
review, and adequate support for changes to master data;
* Implementing an effective auditing and monitoring capability.
Implementing an effective design of master data elements:
Master data elements should be designed to minimize the risk of
erroneous master data. The effectiveness of master data design can be
affected by the following:
* Centralized versus decentralized maintenance � centralized master
data maintenance provides a greater control over creation and change of
master data. It could, however, delay the process. Since most
applications provide field or functional level access, it is possible
for key data to be centrally maintained and functional specific data
maintained by a unit. For example, vendor master data can be segmented
into purchasing data and finance data, separately maintained by
purchasing and finance departments, respectively.
* Partial edit � Master data maintenance may be controlled by rules
that can be configured to prevent changes to certain areas of data, or
key fields within a record.
* Numbering � System-assigned internal numbering is generally
considered to be lower risk than external numbering, however,
management can choose to use external numbering (to match numbers from
an external system) and can choose naming conventions appropriate to
its use. Adequate procedures should be in place to reasonably assure
compliance with management�s policy on numbering/naming conventions.
* Ownership � Ownership should be clearly identified.
Establishing master data maintenance procedures, including approval,
review, and adequate support for changes to master data:
As discussed earlier, master data are much more static than transaction
data, which may be created and updated on a daily basis by a wide range
of users. Master data maintenance, therefore, should be the domain of
fewer users than those responsible for updating transaction data.
Because Master Data serves as the basis for transaction processing, it
is critical that controls exist over the integrity and quality of the
data. An erroneous Master Data record will compromise the integrity of
whatever transactions use the field values stored in the master data.
Characteristics of erroneous master data elements include, but are not
limited to, duplicate names, invalid records, duplicate addresses,
improper address formats, incomplete or inaccurate address information,
unpopulated data fields and other data formatting inconsistencies
between the business rules and the data sets.
Because it is foundational in nature and may have a broad impact on
transactional data, master data should be carefully controlled through
reviews and approval by designated data owners. To reasonably assure an
appropriate level of control, a combination of automated, preventive
controls and manual, detective controls is recommended.
Controls over master data include controls related to:
* changes to the configuration of the master file;
* validity of all master file records;
* completeness and validity of master file data;
* consistency of master data among modules, and;
* approval of changes to master file data.
Implementing an effective auditing and monitoring capability:
As part of the control of master data, the organization should have an
effective auditing and monitoring capability which allows changes to
master data records to be recorded and reviewed where necessary. This
monitoring may be done either as part of ongoing activities or through
separate �master data audits�. In either case, the most important
factor supporting the capability is that activity is properly captured
and maintained by an automated logging mechanism.
Depending on the level of risk associated with the data, the type and
frequency of monitoring may vary. Ideally, monitoring should be built
into the normal, recurring responsibilities of the data owner. Because
audits take place after the fact, problems often will be identified
more quickly by ongoing monitoring routines.
Ongoing monitoring may include obtaining approval prior to changes, or
verifying the accuracy of changes on a real-time basis.
For federal systems, NIST SP 800-53 includes the following controls
related to master data setup and maintenance:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
Table 47. Control Techniques And Suggested Audit Procedures For
Critical Element BP-4 Master Data Setup and Maintenance is Adequately
Controlled:
Control activity:
BP-4.1 Master data are appropriately designed.
Control techniques:
BP-4.1.1 An entry is required in all key fields, such as address and
account number.
BP-4.1.2 Null values or invalid values are not accepted in the required
fields.
BP-4.1.3 For financial applications, account assignments (asset,
liability, income and expense) are accurately defined.
Audit procedures:
Inspect master data configuration for required field values. Observe
user input of invalid values, or blank values, and note any exceptions.
Inspect master data configuration for account groups and assignments.
Control activity:
BP-4.2 Changes to master data configuration are appropriately
controlled.
Control techniques:
BP-4.2.1 Policies and procedures are established for master data
configuration management, which include change rules that identify data
fields that are excluded from changes (for example, master data
number).
Audit procedures:
Review the master data polices and procedures for change management.
Control activity:
BP-4.2 Changes to master data configuration are appropriately
controlled.
Control techniques:
BP-4.2.2 Changes to the master data design are approved by appropriate
personnel.
Audit procedures:
Inspect a sample of change requests and verify that appropriate
approvals are obtained. Inspect master data configuration for change
rules, if the rules are configured. If the change rules are automatic,
then the user should be prevented from making unauthorized
configuration changes.
Control activity:
BP-4.2 Changes to master data configuration are appropriately
controlled.
Control techniques:
BP-4.2.3 Changes to the master data records should be limited to non-
key fields.
Audit procedures:
Inspect a sample of master data change reports and verify that changes
are limited to management-defined non-key fields.
Control activity:
BP-4.3 Only valid master records exist.
Control techniques:
BP-4.3.1 Master data is reviewed on a regular basis, duplicates are
identified and removed or blocked, and unused data is identified and
blocked.
BP-4.3.2 Automatic application controls (duplicate checks, system
warnings) are configured to prevent and/or identify potential duplicate
master records.
Audit procedures:
Inquire of management regarding their master data review procedures.
Inspect policies and procedures on master data review, including
duplicate master data entry and resolution, and unused master records.
Inspect evidence of the most recent management review and action.
Inspect list of accounts/records blocked for posting or use. Inspect
duplicate master record report and management's use of it. Inspect
application configuration for automatic controls and determine whether
the controls prevent erroneous processing or simply warn of potential
errors.
Control activity:
BP-4.4 Master data are complete and valid.
Control techniques:
BP-4.4.1 Policies and procedures for master data maintenance are
documented and include:
* approval requirements;
* data quality criteria;
* data owner;
* supporting documents;
* backup procedures in the event of a disaster or data corruption
error;
* Archival policies.
BP-4.4.2 The master data maintenance process includes a formal
create/change request from the requestor and approval from the data
owner.
BP-4.4.3 Segregation of duties conflicts are considered and resolved
before providing access to master data transactions.
BP-4.4.4 Edit reports are reviewed by appropriate data owners on a
periodic basis to review new master data and changes made to existing
master data.
Audit procedures:
Inspect master data maintenance policies and procedures for
appropriateness. Select a sample of master data created or changed, and
inspect relevant documentation, noting appropriate approvals and
compliance with policies and procedures. Obtain system report of users
with master data maintenance access. For a sample of users with
conflicting responsibilities, inspect user profiles noting evidence of
segregation of duty consideration and review when conflicts are noted.
Inquire of responsible personnel and inspect policies and procedures
covering master data maintenance. Inspect procedures for identifying,
segregation of duty exceptions, and review compliance. Inspect evidence
of proper review of edit reports by owners.
Control activity:
BP-4.5 Master data are consistent among modules.
Control techniques:
BP-4.5.1 Periodic review and reconciliation procedures are in place to
ensure that master data are consistent between different application
modules.
Audit procedures:
Inspect evidence of management reconciliation and review for
effectiveness. Through inquiry and inspection, determine whether the
frequency of management reconciliation of master data is appropriate.
Control activity:
BP-4.6 Master data additions, deletions, and changes are properly
managed and monitored by data owners.
Control techniques:
BP-4.6.1 Master data policies and procedures require data owner's to be
responsible for the creation, deletion, and change of master data and
also changes to data characteristics.
BP-4.6.2 Data owners monitor master data design changes, and approve
and monitor creation, deletion and changes to master data on a regular
basis.
Audit procedures:
Review policies and procedures and inquire of data owner concerning
application of specific monitoring procedures. Obtain and inspect
evidence of monitoring by data owners, including related reports.
Inquire of management regarding ongoing monitoring of master data
changes. Obtain and inspect evidence of management review of master
data design changes, and determine whether changes are approved and
reviewed.
Control activity:
BP-4.7 As appropriate, the confidentiality of master data is adequately
controlled.
Control techniques:
BP-4.7.1 Management implements adequate controls to protect the
confidentiality of master data, as appropriate.
Audit procedures:
Assess the adequacy of management controls over confidentiality of
master data. Coordinate this step with Critical Element AS-2 Implement
effective application access controls.
Source: GAO.
[End of table]
4.3. Interface Controls (IN):
Interface controls consist of those controls over the a) timely,
accurate, and complete processing of information between applications
and other feeder and receiving systems on an on-going basis, and b)
complete and accurate migration of clean data during conversion.
Interfaces [Footnote 96] result in the structured exchange of data
between two computer applications, referred to in this section as the
source and target systems or applications. These applications may
reside on the same or different computer systems that may or may not
reside in the same physical environment. Interfaces are periodic and
recurring in nature. Interface controls may be performed manually or
automated, scheduled or event-driven, electronically or on paper. One
interface transfers one business data object and is one-directional;
e.g. vendor master outbound, sales order inbound, etc. Interfaces are
never bi-directional, even if technically there may be handshaking,
back-and-forth reconciliation, etc.
This section focuses on the scope of and controls for interfaces,
governing specifically the extraction, transformation, and loading of
data between two applications. The data input, validation, and output
controls within an application are addressed in the preceding business
process control sections.
The interface process, including conversions, can be broken down into
the following seven separate components:
1. Interface strategy � A documented strategy is developed to keep data
synchronized between source and target application. The strategy should
include an explanation of each interface, the interface method chosen
(manual or batch, etc.), the data fields being interfaced, the controls
to reasonably assure that the data is interfaced completely and
accurately, timing requirements, definition of responsibilities, on-
going system balancing requirements, and security requirements.
2. Data Export/Extraction �The information needs of the target
application (key information fields, ID fields and cross-reference
fields) should be fully understood and documented. If the information
needs are not fully understood, all relevant data may not be extracted.
In addition, appropriate procedures/should be in place concerning the
format, quality, cut-off, and audit trails related to source data.
a. The format of the source data should be checked to reasonably assure
that the information is available, accurate and at the appropriate
level of detail. If the source data quality is poor, the data may not
be able to be interfaced.
b. Data processing should be cut-off as of a specific time to
reasonably assure that the data is extracted for the proper period.
c. Sufficient audit trails should exist for the source application,
such that once the data is extracted, the original audit trail remains.
For instance, invoices can be traced back to the applicable purchase
order in the source system.
3. Data Mapping/Translation � Data mapping and translation is the
process of converting source data from the source application format to
the target application format. If the data is not entered in the target
application in exactly the same way as it is expected, target
application edit and validation checks may be rendered ineffective.
4. Data Import � Data import is the process of loading source data into
the target application. Appropriate controls, such as database indicies
that enforce uniqueness, should be in place to prevent duplicate
processing.
5. Error Handling and Reconciliation procedures � The procedures
developed to reasonably assure that all transactions are accounted for
and that all errors are identified, isolated, analyzed, and corrected
in a timely manner.
6. Job definition, Scheduling and Event Triggering � Due to business
requirements, it may be necessary to initiate an interface daily,
weekly, monthly, or after a triggering event. �Triggering events� are
used to start interface processing based on specific criteria, such as
date/time or completion of another event. Interfaces may run across
multiple platforms. Therefore, interface jobs may need to be scheduled
across platforms. Visibility of these jobs may be necessary in a single
location by the system operators. Restart and recovery procedures
should exist.
7. Data Handling � Interfaced data should be able to be retrieved to re-
execute the interface, if needed. Controls should be established to
support the confidentiality and proper handling of sensitive data.
Access to interface data and processes should be properly restricted.
The objectives of interface controls are to:
* Implement an effective interface strategy and design;
* Implement effective interface processing procedures, including;
- interfaces are processed completely, accurately and only once in the
proper period.
- interface errors are rejected, isolated and corrected in a timely
manner.
- access to interface data and processes are properly restricted. Data
is reliable and obtained only from authorized sources.
For federal systems, NIST SP 800-53 includes the following controls
related to interface:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
Critical Elements:
The critical elements for interface controls are:
IN-1 Implement an effective interface strategy and design;
IN-2 Implement effective interface processing procedures.
Because weaknesses in interface controls can affect the achievement of
all of the control objectives (completeness, accuracy, validity, and
confidentiality) related to applications data, the control activities
in the control tables for interface controls do not contain reference
to specific control objectives.
Critical Element IN-1: Implement an effective interface strategy and
design:
The purpose of an interface strategy is to describe, at a high level,
how the interfaces are implemented between two applications. The
interface strategy is the basis for the interface design and scope. The
interface strategy includes an explanation of each interface, the
interface method chosen (manual or batch, etc.), the data fields being
interfaced, the controls to reasonably assure that the data is
interfaced completely and accurately, timing requirements, assignment
of responsibilities, on-going system balancing requirements, and
security requirements. Interface design uses guidelines set by the
strategy and provides specific information for each of the
characteristics defined in the strategy.
Table 48. Control Techniques and Suggested Audit Procedures for
Critical Element IN-1: Implement an effective interface strategy and
design:
Control activities:
IN-1.1 An interface strategy is developed for each interface used in
the application.
Control techniques:
IN-1.1.1 An interface strategy exists for each interface that includes
the interface method, data fields being interfaced, controls to
reasonably ensure a complete and accurate interface, schedule,
assignment of responsibilities, system balancing requirements and
security requirements.
Audit procedures:
Obtain a list of all interfaces to and from the application audited.
Inspect the interface strategy document noting the details of each
interface and determine whether it contains appropriate information.
Control activities:
IN-1.2 An interface design is developed for each interface used in the
application that includes appropriate detailed specifications.
Control techniques:
IN-1.2.1 An interface design exists for each interface and includes
appropriate specifications based on the business requirements,
including:
* validations and edits;
* ownership of the interface process;
* error correction and communication methods.
Audit procedures:
Inspect interface design documents of each interface and determine
whether it contains appropriate information.
Control activities:
IN-1.2 An interface design is developed for each interface used in the
application that includes appropriate detailed specifications.
Control techniques:
IN-1.2.2 Mapping tables are used to convert data from the source system
to the target system. Controls are in place to reasonably assure that
mapping tables are only changed when authorized and that historical
data on mappings is retained with the previous mapping table.
Audit procedures:
Determine whether the interfaces use mapping tables. Verify that
controls over mapping tables will be established.
Control activities:
IN-1.2 An interface design is developed for each interface used in the
application that includes appropriate detailed specifications.
Control techniques:
IN-1.2.3 If mapping tables are not used, appropriate edits and
validations are present in the source system.
Audit procedures:
Verify whether the appropriate edits and validations are implemented in
the source systems.
Source: GAO.
[End of table]
Critical Element IN-2: Implement effective interface processing
procedures Because there may be several methods that are used to
transfer data from one system to another, the auditor should understand
the procedures that are used for each interface, including:
* Who is the owner of the interface? Who initiates the process?
* How is the data transferred from the source application?
* How often are the interface programs run?
* How does the target system get the notification of an interface?
* Where are the errors corrected - in the source or target system?
Controls surrounding interface processing should reasonably assure that
data is transferred from the source system to target system completely,
accurately, and timely. The processing routines should include
balancing by ensuring the opening balance control totals plus processed
transactions equal the closing balance of control totals. Both the
applications (source and target) are typically designed with controls
so that data are controlled by the use of control totals, record
counts, batching run totals, or other data logging techniques. These
types of controls are commonly referred to as balancing controls.
Records or data produced by one application may be used in another
application and may have dependencies that are based upon the
sequential processing of data. The entity should have effective
procedures to reconcile control information between the source and
target applications.
During interface processing, all data may not be processed completely
or accurately as a result of errors or inconsistencies in data, system
interruptions, communication failures, or other events. To identify
these instances, a monitoring capability should be implemented. The
objective of the monitoring function is to reasonably assure that data
are accurately processed through the interface and that no data are
added, lost, or altered during processing. Control techniques include:
* If the interface is �run� on a regular schedule to process data,
either manually or automatically, documented procedures explain how
this is performed, including controls in place to reasonably assure
that all processing was completed.
* An interface processing log is maintained and reviewed for unusual or
unauthorized activity.
* The interface processing log, or another log or report, is used to
document any errors or problems encountered during processing. Types of
information that should be considered for logging are descriptions of
any errors encountered, dates identified, any codes associated with
errors, any corrective action taken, date and times corrected.
* Procedures are in place to use the correct generation/cycle of files
for processing. This may include the generation of backup files from
processing to be used for disaster recovery.
* Audit trails are generated during processing. These audit trails
should be logs or reports that contain information about each
interface. Data that should be included are who initiated each of the
interfaces, the data and time of the run, the source system, and the
results.
* Procedures are implemented to identify and correct any errors that
occur during the interface run. Error handling procedures during data
entry should reasonably assure that errors and irregularities are
detected, reported, and corrected. Errors should be corrected in the
source system and reprocessed through the next run. Management should
have procedures in place to reasonably assure that error logs are used
to timely follow-up on and correct unresolved data errors and
irregularities.
Table 49. Control Techniques And Suggested Audit Procedures For
Critical Element Critical Element Critical Element IN-2: Implement
effective interface processing procedures:
Control activities:
IN-2.1 Procedures are in place to reasonably assure that the interfaces
are processed accurately, completely and timely.
Control techniques:
IN-2.1.1 Procedures include a complete list of interfaces to be run,
the timing of the interface processing, how it is processed and how it
is reconciled. If system interconnections are used, procedures should
address requirements for an Interconnection Security Agreement and
Memorandum of Understanding. Timing for processing of the interface has
been determined and is followed. A positive acknowledgement scheme is
used to ensure that files sent from a source system are received by the
target system (i.e., a "handshake" between the systems so that files
are not skipped or lost).
Audit procedures:
Inspect documentation of interface processing procedures and, if
applicable, Interconnection Service Agreements and Memorandums of
Understanding. Observe interface processing into the application.
Determine whether data and files from interface activities are
processed according to the stated policies and in the proper accounting
period. Determine whether all files sent from the source system are
received and acknowledged by the target system.
Control activities:
IN-2.2 Ownership for interface processing is appropriately assigned.
Control techniques:
IN-2.2.1 Responsibility for processing the interface and correcting any
errors has been assigned to a user from the source and to a user of the
target system. Actual processing may involve a technical person, if the
interface is processed via an electronic media, such as a tape.
Audit procedures:
Identify which users are assigned responsibility for the interfaces.
Evaluate whether an appropriate level of resources has been assigned to
maintain interfaces.
Control activities:
IN-2.2 Ownership for interface processing is appropriately assigned.
Control techniques:
IN-2.2.2 The files generated by an application interface (both source
and target) are properly secured from unauthorized access and/or
modifications.
Audit procedures:
Assess whether appropriate security is in place for all access points
to the interface data are secure from unauthorized use. Identify
individuals that will be responsible for providing security surrounding
the interfaces.
Control activities:
IN-2.2 Ownership for interface processing is appropriately assigned.
Control techniques:
IN-2.2.3 Users who are processing interfaces are able to monitor the
status of interfaces.
Audit procedures:
Assess whether proper access is assigned to the appropriate individuals
for the monitoring of the interface status and that such individuals
have access to appropriate information to monitor the status of the
interface.
Control activities:
IN-2.3 The interfaced data is reconciled between the source and target
application to ensure that the data transfer is complete and accurate.
Control techniques:
IN-2.3.1 Reconciliations are performed between source and target
applications to ensure that the interface is complete and accurate.
Control totals agree between the source and target systems. Reports
reconcile data interfaced between the two systems and provide adequate
information to reconcile each transaction processed.
Audit procedures:
Inspect reports or other documents used to reconcile interface
processing between source and target applications and review their
content and frequency for appropriateness.
Control activities:
IN-2.4 Errors during interface processing are identified by balancing
processes and promptly investigated, corrected and resubmitted for
processing.
Control techniques:
IN-2.4.1 Management maintains a log for interface processing. The log
accounts for errors and exceptions, as well. Exception/error reports
are produced, reviewed, and resolved by management on a regular basis,
including correction and resubmission, as appropriate.
Audit procedures:
Through inquiry of management and review of logs, determine whether
errors are properly handled. Assess the appropriateness of the
frequency that exception reports are reviewed (daily, weekly, etc).
Inspect evidence of such reviews having been performed.
Control activities:
IN-2.5 Rejected interface data is isolated, analyzed and corrected in a
timely manner.
Control techniques:
IN-2.5.1 Error and correction facilities are utilized to track and
correct errors in interface data.
Audit procedures:
Assess the adequacy of procedures in place to properly correct any
rejected transactions. Inquire about procedures applied with
individuals responsible for identifying and correcting errors and
inspect evidence that rejected data is properly processed timely basis.
Control activities:
IN-2.5 Rejected interface data is isolated, analyzed and corrected in a
timely manner.
Control techniques:
IN-2.5.2 A mechanism is used to notify users when data is rejected (for
example, an e-mail message may be sent to the user). These messages
should repeat daily until they are corrected.
Audit procedures:
Determine whether error messages are generated and promptly reviewed
for all rejected data and are maintained until corrected.
Control activities:
IN-2.5 Rejected interface data is isolated, analyzed and corrected in a
timely manner.
Control techniques:
In-2.5.3 Audit trails are used to identify and follow-up on interface
errors. The corrections to interface errors are included in the audit
trail.
Audit procedures:
Determine whether appropriate audit trails are generated, reviewed and
maintained.
Control activities:
IN-2.6 Data files are not processed more than once.
Control techniques:
IN-2.6.1 Interfaces files are automatically archived or deleted from
the production environment after processing.
Audit procedures:
Inspect a sample of archived interface documents and verify the date
and time of processing. Observe the interfaces that are in process and
inspect evidence that they were not processed before in the same
period.
Source: GAO.
[End of table]
4.4 Data Management System Controls (DA):
Applications that support business processes typically generate,
accumulate, process, store, communicate and display data. Applications
which handle significant volumes of data often employ data management
systems to perform certain data processing functions within an
application. Data management systems use specialized software which may
operate on specialized hardware. Data management systems include
database management systems, specialized data transport/communications
software (often called middleware), cryptography used in conjunction
with data integrity controls, data warehouse software and data
reporting/data extraction software. Many of the data input and
processing controls, such as edit checks, existence checks and
thresholds described in previous sections are implemented in functions
of data management systems. These types of controls implemented in data
management systems are often referred to as business rules.
When assessing the effectiveness of application controls, the auditor
should evaluate functions of data management systems specific to the
business processes under review, in addition to the general controls
described in Chapter 3. When auditors are evaluating application
security plans and independently assessing risk, consideration of the
risk inherent to the data management system �layer� in the application
architecture is important. Necessarily, multiple access paths must
exist into the data and the business rules that reside in the data
management system layer to facilitate the operation and administration
of the application. In most large scale and/or high performance
applications, various components of data management systems reside on
different servers which often employ various operating systems and
hardware technologies. The auditor should obtain an understanding of
the interconnected combination of data management technologies and
appropriately consider related risks.
Understanding the logical design and physical architecture of the data
management components of the application is necessary for the auditor
to adequately assess risk. In addition to supporting the data storage
and retrieval functions, it is typical for applications to employ data
management systems to support operational aspects of the application,
such as the management of transient user session state data, session
specific security information, transactional audit logs and other
�behind the scenes� functions that are essential to the application�s
operation. Controls associated with these types of functions can be
critical to the security of the application.
The following highlights certain key concepts the auditor considers
when assessing controls over a data management systems, including
database management systems, middleware, cryptography, data warehouse,
and data reporting/data extraction software.
Key Concepts - Database Management Systems:
Authentication/Authorization:
Controls in a data management system should include consideration of
the access paths to the data management system. The access paths should
be clearly documented and updated as changes are made. Generally access
to a data management system can be obtained in three ways, via:
* Directly, via the database management system;
* Through access paths facilitated by the application; or;
* Through the operating system(s) underlying the database management
system.
Data management systems have built in privileged accounts that are used
to administer and maintain the data management system. The auditor's
objective is to determine whether appropriate controls are in place for
securing these privileged accounts. Such controls include, but are not
limited to:
* Strong password usage or other authentication controls;
* Highly restrictive assignment of personnel to these accounts;
* Enforcement of unique accounts for each administrator; and;
* Effective monitoring of privileged account use.
In addition to privileged accounts, the auditor should obtain an
understanding of the role the data management system plays in
authentication and authorization for the application. The data
management system will also contain user accounts related to the
application.
Generally, there are two methods of authentication using a data
management system. In the first scenario, the application uses a
generic ID to authenticate to the database on behalf of end-users.
These generic IDs should have their access privileges carefully scoped
to only provide access to what the highest level of end-user is
permitted to access. There should be a limited number of generic IDs
within the database supported by well-documented and carefully
monitored control procedures. In the second scenario, the application
passes the user ID to the database and uses accounts assigned to each
end-user to authenticate to the database. Depending upon the size of
the application, there could be a large number of user accounts stored
within the database management system. In either case, the auditor
should review the account and password policies relevant to the
database management system.
There may be situations where authentication to the data management
system is done through the operating system. The auditor should, in
such instances, coordinate testing of general controls related to the
operating system.
There are two major types of database management systems in use,
hierarchical and relational databases. Hierarchical databases, such as
IBM�s IMS, have a heritage near the beginning of computer systems;
however they are still used in some modern applications. Each different
hierarchical database product is proprietary in design and
implementation. If achieving audit objectives involving hierarchical
databases is a requirement, staff with knowledge of the specific
database product will be necessary. Relational databases (such as
Oracle, DB2, and SQL-Server) share a common design based on relational
algebra and a common data access method, called the Structured Query
Language (SQL). While there are differences in the implementation of
the different relational database products, they are similar enough
that staff should be able to perform audit work in most relational
database systems with a common skill set. The discussion in this
chapter will focus on relational database systems.
SQL Commands:
There are two categories of commands available through SQL, data
definition language statements (DDL) and data manipulation language
statements (DML). DDL statements are used to define and alter the
structures or objects that contain and support access to data. DDL
statements are used to create, alter and delete objects such as tables
and indices. DML statements are used to retrieve, add, change and
delete data in existing database objects. Application end-users would
not typically need to use DDL statements.
System, Role, Object Privileges:
A user privilege is a right to execute a particular type of Structured
Query Language (SQL) server statement, or a right to access another
user's object. As discussed below, there are two types of data
management system privileges: system and object. Roles are created by
users (usually administrators), and are used to group together
privileges or other roles. They are a means of facilitating the
granting of multiple privileges or roles to users.
System privileges relate to the ability of the user within the database
to interact with the database itself using DDL statements and the
ability to execute special functions. They include: CREATE, ALTER,
DROP, CONNECT, and AUDIT, among many others. The auditor should examine
the privileges granted to the users within the database. Typically
administrator level accounts have extended system privileges while
general user accounts should have limited access to system privileges.
Object privileges (through DML statements) allow the user to have
access to the data within an object or allow the user to execute a
stored program. These include SELECT, INSERT, DELETE, etc. Each type of
object has different privileges associated with it. Examples of
database objects include the following:
* Tables - A data structure containing a collection of rows (or
records) that have associated columns (or fields). It is the logical
equivalent of a database file.
* Index - A database object that provides access to data in the rows of
a table, based on key values. Indexes provide quick access to data and
can enforce uniqueness on the rows in a table.
* Triggers - A special form of a stored procedure that is carried out
automatically when data in a specified table is modified. Triggers are
often created to enforce referential integrity or consistency among
logically related data in different tables.
* Stored procedure � A precompiled collection of SQL or other
statements and optional control-of-flow statements stored under a name
and processed as a unit. Stored procedures are stored within a
database, can be executed with one call from an application, and enable
user-declared variables, conditional execution, and other powerful
programming features.
* Views - A virtual table generated by a query whose definition is
stored in the database. For example, a view might be defined as
containing three out of five available columns in a table, created to
limit access to certain information. Views can be treated as tables for
most database operations, including Select queries, and under some
circumstances, Update, Insert, and Delete queries. Any operations
performed on views actually affect the data in the table or tables on
which the view is based.
The auditor should identify the objects within the data management
system. The privileges that a user account has for each object should
be reviewed. These privileges should be granted based on the
functionality of the account.
A role groups several privileges and roles, so that they can be granted
to and revoked from users simultaneously. A role should be enabled for
a user before it can be used by the user. Predefined roles exist that
can be leveraged, such as the data base administrator (e.g., DBA) role.
The auditor should review the privileges granted to each role, and then
analyze the role(s) granted to each user. Roles that grant high level
access, or permit direct manipulation of data in the database are very
sensitive. The auditor should evaluate controls over the use of such
roles.
Stored Procedures:
Stored procedures are programs that are compiled and stored in the data
management system. These programs can be executed directly by a user or
they can be called by other programs. Most data management systems are
prepackaged with stored procedures that provide a structured and
controlled method of administering the database. For example, when the
administrator creates a user, the database management system uses a
stored procedure to perform the steps necessary to create that account.
In addition custom stored procedures can be created to support
additional functionality. The auditor should review stored procedures
that interact with sensitive data within the database management system
or provide access to the operating system.
Key Concepts � Middleware:
Modern business applications frequently have user interface, data
processing and data storage components hosted on different computer
systems, often using different operating systems. Tying the components
together is often accomplished through the use of specialized data
transport/communications software commonly known as middleware. A
popular example of this type of software is IBM�s MQSeries. Middleware
is used to connect applications together in varying architectures
including interconnected systems and interfaced systems (as described
in 4.3).
Middleware provides robust and potentially secure communications
between application components through layers of functions across a
series of host computer and network technologies. In modern application
architectures, the �behind the scenes� processing and storage of
information may be designed to trust upstream application components,
such as user interfaces, due to the data security and data integrity
services provided by the middleware. Middleware can be used to
communicate both data and commands between systems using different
operating systems. The communication links are often facilitated by
channels created by the middleware. The channels can be configured so
that they provide data security for the information flowing across the
network, typically using cryptography, and data integrity through error
detection and correction facilities. Middleware can also be an
important aspect of an application�s continuity of operations, by being
configured to support multiple data paths to eliminate single points of
failure across networks.
Middleware Controls:
Middleware components can be found on many components in a network of
computers used to support business applications. The location and
function of these components should be well documented. Middleware
carries not only data and system commands; it also typically
facilitates the establishment of sessions between application
components, often some level of application component logging onto a
�back-end� host and database management system. An application�s
controls often rely on the encrypted transmission of information
between components. This protection may be a function of the
implementation of middleware, sometimes in conjunction with how the
channels are configured across the network. As with other data
management systems, auditors should identify the staff with
administrative access privileges to middleware and verify that
appropriate controls are in place.
Key Concepts � Cryptography:
Modern business applications commonly employ one or more controls that
rely on cryptographic services. Auditors should identify where these
controls are deployed and verify that the technical implementations are
appropriate and effective operational procedures are in place and being
followed. The mere existence of cryptography provides no assurance that
data controls are actually in place and effective. Due to the exacting
nature of verifying the effectiveness of cryptographic controls, a
detailed discussion is beyond the scope of this audit guidance. When it
is necessary to evaluate the effectiveness of cryptographic controls to
achieve audit objectives, the auditor should obtain the services of
adequately qualified specialists.
Key Concepts � Data Warehouse, Data Reporting and Data Extraction
Software:
Increasingly, modern business applications are parts of larger business
management information architectures. This is certainly the case with
ERP environments, but also is the result of interconnected and
interfaced systems that supply information used for purposes beyond the
application�s primary business function. A common element in these
combined business management information architectures is the data
warehouse, which may be populated with both financial and non-financial
business information. The data warehouse is often a separate data
store, not operationally part of the entity�s transactional systems.
The reasons behind having this separate copy of business information
can be multifold: separating the information eliminates potential
performance issues associated with trying to use live transactional
data for reporting; also the structure of the information in diverse
business applications may be technically or logically incompatible with
efficient information retrieval. When the auditor encounters a data
warehouse, important questions related to audit objectives and system
boundaries need to be addressed. Unless the data warehouse itself is
the subject of the audit, the relevance to the audit objectives and
potential risks created by the data warehouse need to be identified and
evaluated. Since a data warehouse may represent a copy of information
from other systems that are part of the audit, any data confidentiality
concerns will likely need consideration. Additionally, the auditor may
need to functionally understand how the entity uses the data warehouse.
In a financial audit, the auditor may find that financial statements
may be prepared, in part, from the data warehouse instead of directly
from the general ledger.
A data warehouse typically exists to facilitate analysis and reporting
from a large quantity of data. Supporting the efficient use of a data
warehouse will often be specialized data reporting and data extraction
software tools. The existence of these tools and data warehouses
creates the potential for many different access paths to data.
Depending on the control requirements of the data warehouse and the
information it stores, the auditor may need to identify controls over
how the data is populated, maintained, and accessed by both users and
administrators. The software systems involved are often specialized and
effective reviews may require the services of qualified specialists.
Segregation of Duties:
Since data management systems are supported by one or more operating
systems, the auditor should obtain an understanding of the role of the
data management system administrators. There should be a distinct
segregation between the data management system administrator and the
operating system administrator. The operating system administrator may
need access to the data management system, but should have limited
access. Likewise, the data management system administrator may need
access to the underlying operating system, but should have only the
access necessary to manage the data management system functionality.
The auditor should also evaluate the segregation between the data
management system administrator and personnel in charge of reviewing
audit and transaction logs. The data management system administrator
should not have access to the audit logs within the data management
system. These logs should be reviewed by a security administrator.
There should also be a separation between the functional aspects of the
data management system environments. Data management system access
should be consistent with the functional separation of duties within
the application environment. Users that are developers should have
access to the development environment only, and consequently only the
development data management system. Users that require access to
production should only have access to the production data management
system.
Control Activities:
Control activities for data management system controls are:
DA-1.1 Implement an effective data management system strategy;
DA-1.2 Identify and respond to specific system or user security events
within the data management system and its related components;
DA-1.3 Properly control specialized data management processes.
Because weaknesses in data management controls can affect the
achievement of all of the control objectives (completeness, accuracy,
validity, and confidentiality) related to applications data, the
control activities in the control tables for interface controls do not
contain reference to specific control objectives.
Table 50. Control Techniques and Suggested Audit Procedures for
Critical Element DA-1 - Implement an effective data management system
strategy and design:
Control activities:
DA-1.1 Implement an effective data management system strategy and
design, consistent with the control requirements of the application and
data. The strategy addresses key concepts including:
* database management;
* middleware;
* cryptography;
* data warehouse, and;
* data reporting/data extraction.
Control techniques:
DA-1.1.1 The physical and logical (in terms of connectivity) location
of the data storage and retrieval functions are appropriate.
DA-1.1.2 The production data management system is effectively separated
from non-production systems (such as testing and development) and other
production systems with lesser control requirements.
DA-1.1.3 The database schema is consistent with access control
requirements such that the organization of data and database-hosted
functions correspond to the access limitations that need to be imposed
on different groups of users.
Audit procedures:
Inspect documentation of the design of the data management system(s)
associated with the application. Assess whether the data management
system is properly designed. Determine whether the design is properly
implemented. Verify that all access paths to data and sensitive data
management system administrative functions have been identified and are
adequately controlled.
Control activities:
DA-1.2 Detective controls are implemented in a manner that effectively
supports requirements to identify and react to specific system or user
activity within the data management system and its related components.
Control techniques:
DA-1.2.1 Logging and monitoring controls are in place at the data
management system level which effectively satisfy requirements to
accurately identify historical system activity and data access;
DA-1.2.2 Real-time or near real-time controls are in place to detect
abnormal activity and security events.
Audit procedures:
Identify the security events that are logged and determine whether
logging is adequate. Assess the adequacy of controls to monitor the
audit logs. Assess the adequacy of controls to detect abnormal
activity.
Control activities:
DA-1.3 Control of specialized data management processes used to
facilitate interoperability between applications and/or functions not
integrated into the applications (such as ad-hoc reporting) are
consistent with control requirements for the application, data and
other systems that may be affected.
Control techniques:
DA-1.3.1 Data accuracy and completeness controls are in place and
effective to correct and/or detect data anomalies.
DA-1.3.2 The configuration of system connectivity that facilitates
application to application and application to non-integrated functions
is controlled to limit access appropriately.
Audit procedures:
Identify and obtain an understanding of specialized data management
processes used to facilitate interoperability. Understand how system
interconnectivity is controlled with respect to data management
systems. Assess the adequacy of controls over specialized management
processes. Note: These procedures should be closely coordinated with
tests of general controls related to the data management systems.
Source: GAO.
[End of table]
[End of chapter]
Appendix I - Information System Controls Audit Planning Checklist:
The auditor should obtain and document a preliminary understanding of
the design of the entity�s information system (IS) controls, including:
* Understanding the entity�s operations and key business processes;
* Obtaining a general understanding of the structure of the entity�s
networks;
* Obtaining a preliminary understanding of IS controls.
In addition to this checklist, the auditor should obtain information
from relevant reports and other documents concerning IS that are issued
by or about the entity.
To facilitate this process, the following checklist has been developed
as a guide for the auditor to collect preliminary information from the
entity at the start of the audit. This checklist is intended as a
starting point for collecting relevant IS control information. The
information request can be tailored to the type of audit being
performed. For example, an audit of application controls could be
limited to the information needs listed in Sections I, II, and IV. The
extent of the information requested from the entity will vary depending
on whether this is a first year or follow-up review of IS controls.
Also, as a result of the auditor�s initial review and analysis of the
information collected in this process, additional detailed information
may need to be subsequently requested from the entity. The checklist is
organized to request information on the entity�s:
* organization and key systems/applications;
* prior audit reports/documents;
* IS general controls, and;
* IS business process application level controls.
I. Organization and Key Systems/Applications Understanding the entity�s
organization is a key to planning and performing the audit in
accordance with applicable audit standards and requirements. Further,
it helps to identify, respond to, and resolve problems early in the
audit. Relevant information includes organizational structure,
locations, use of contractors, key applications and IS platforms used
to support them.
Document:
1. Entity�s overall organizational chart with functional description of
key components.
Document:
2. Organizational charts that include functional description for
security and IT components. Note: It is critical that the
organizational relationships between management, information security,
physical security, and computer operations are discernable.
Document:
3. Name and functional description of relevant major applications,
including functional owner, operating platform (including locations),
operating system and version, and database management system and
version. Note: FISMA requires agencies to maintain an inventory of all
major systems.
Document:
4. Name and functional description of relevant operating environments
(e.g., general support systems (GSS)), including locations.
Document:
5. List of contractors/third parties or other governmental entities
that process information and/or operate systems for or on behalf of the
entity.
6. Significant changes in the IT environment or significant
applications implemented within the recent past (e.g., within 2 years)
or planned within the near future (e.g., 2 years)
II. Prior Audit Reports/Documents:
The auditor generally gathers planning information through different
methods, including previous audits, management reviews, and other
documents. These reports often provide invaluable information on the
effectiveness of IS controls and provides clues to areas of particular
risk. Of specific interest are those reports/documents dealing with the
IS control environment, including GSS and major applications. Relevant
information in this area includes the following.
Document:
1. Internal or third party information system reviews, audits, or
specialized testing (e.g., penetration tests, disaster recovery
testing) performed during the last 2 years (e.g., IG, GAO, SAS 70
reports).
Document:
2. The entity�s prior FISMA or equivalent entity reports on IS.
Workpaper Reference:
Document:
3. The entity�s annual performance and accountability report or
equivalent reports (e.g., reports prepared under the Federal Financial
Management Improvement Act of 1996, Federal Managers Financial
Integrity Act of 1982, Government Management and Reform Act and
Accountability of Tax Dollars Act of 2002).
Document:
4. Other reports by management, including privacy impact assessments
and vulnerability assessments.
Document:
5. Consultant reports on IS controls.
III. IS General Controls:
General controls are the policies and procedures that apply to all or a
large segment of an agency�s information systems and help ensure their
proper operation. General controls are applied at the entitywide,
system, and business process application levels. The effectiveness of
general controls at the entitywide and system levels is a significant
factor in determining the effectiveness of business process application
controls at the application level. General controls include security
management, access controls, configuration management, segregation of
duties, and contingency planning.
III.1 IS General Controls � Security Management:
Security management provides a framework and continuing cycle of
activity for managing risk, developing security policies, assigning
responsibilities, and monitoring the adequacy of the agency�s computer-
related controls. The program should reflect the agency�s consideration
of the following critical elements for security management �
established security management program, periodic risk assessments,
documented security policies and procedures, established security
awareness training, and periodic management testing and evaluation of
major systems. Other elements include implementing effective security-
related personnel policies and ensuring that activities performed by
external third parties are adequately secure. Relevant information for
this control category includes the following.
Document:
1. Documentation of entity�s security management program approved by
OMB.
Document:
2. Documented risk assessments for relevant systems (e.g., GSS and
major applications).
Document:
3. Certification and accreditation documentation or equivalent for
relevant systems (e.g., GSS and major applications being reviewed).
Document:
4. Documented security plans for relevant systems (e.g., GSS and major
applications being reviewed).
Document:
5. Agency performance measures and compliance metrics for monitoring
the security processes.
Document:
6. Management�s plans of actions and milestones or their equivalent,
that identify corrective actions planned to address known IS weaknesses
and status of prior year security findings.
Document:
7. Entitywide policies and procedures governing:
* security management program, structure, and responsibilities,
including system inventories;
* risk assessment;
* security awareness training for employees, contractors, third parties
(including those in sensitive security and data processing position)
and security-related personnel policies (including personnel hiring,
reference and background checks, and job transfers and terminations);
* performance of periodic tests and evaluations of IS controls and
monitoring to ensure compliance with established policies and
procedures (including copies of tests and evaluations performed (if not
included under Section II �Prior Audit Reports/ Documents�);
* security weakness remediation, and;
* security requirements and monitoring activities of third-party
providers supporting specific application(s).
III.2 IS General Controls � Access Controls:
A basic management objective for any organization is to protect the
resources that support its critical operations from unauthorized
access. Organizations accomplish this objective by designing and
implementing controls that are intended to prevent, limit, and detect
unauthorized access to computing resources, programs, information, and
facilities. Inadequate access controls diminish the reliability of
computerized information and increase the risk of unauthorized
disclosure, modification, and destruction of sensitive information and
disruption of service. Access controls include those related to
protecting system boundaries, user identification and authentication,
authorization, protecting sensitive system resources, audit and
monitoring, and physical security. Relevant information for this
control category includes the following.
Document:
1. High-level network schematic which identifies external network
connections, inter- and intra-agency connections, contractor sites, and
other external organizations.
Document:
2. Network schematic of all GSS (by site) that includes components such
as:
* internet presence;
* firewalls, routers, and switches;
* domain name servers;
* intrusion detection systems;
* critical systems, such as web and email servers, file transfer
systems, etc.
* network management systems;
* connectivity with other entity sites and other external
organizations;
* remote access � virtual private networks and dial-in, and;
* wireless connections.
Document:
3. Inventory of mid-level systems (Unix, Windows-based, etc.)
supporting applications relevant to the audit.
* operating systems/versions,
* security software/versions,
* list of systems/applications supported, and,
* data set naming conventions for the operating system, system
configuration, utility software, applications, and security software.
* documentation of basic security configuration settings, i.e. Windows-
based, Unix, etc.
Document:
4. Inventory of mainframe systems including:
* operating systems/versions,
* security software/versions,
* IP addresses,
* description and use of each LPAR configuration(production & non
production), including list of user applications and software installed
on each LPAR and description of any test or development activity in
each LPAR.
* data set naming conventions for the operating system, system
configuration, utility software, applications, and security software,
* identity of Exits and SVCs, including load library and module name,
and,
* documentation of basic security configuration settings, i.e. RACF,
Top Secret, or ACF2.
Document:
5. Entitywide policies and procedures for:
* system boundaries,
* controlling remote access to agency information, including use of
remote devices,
* governing user and system identification and authentication,
* requesting, approving, and periodically reviewing user access
authorization,
* restricting access to sensitive system resources (including system
utilities, system software, and privileged accounts),
* protecting digital and sensitive media, including portable media,
* applying cryptography methods, if used,
* monitoring mainframe, mid-level servers, and network systems for
incidents, including management response and reporting on unusual
activities, intrusion attempts, and actual intrusions, and,
* controlling physical security, including those concerning the
granting and controlling of physical access to the data center and
other IT sensitive areas.
Document:
6. Physical diagram of computer network and data center and other
sensitive IT areas.
III.3 IS General Controls � Configuration Management:
Configuration management involves the identification and management of
security features for all hardware and software components of an
information system at a given point and systematically controls changes
to that configuration during the system�s life cycle. By implementing
configuration management, organizations can ensure that only authorized
applications and software programs are placed into production through
establishing and maintaining baseline configurations and monitoring
changes to these configurations. Configuration management includes:
* overall policies and procedures,
* maintaining current configurations,
* authorizing, testing, and approving configuration changes,
* monitoring the configuration, updating software on a timely basis,
and;
* documenting and controlling emergency changes.
Relevant information for this control category includes the following.
Document:
1. Entitywide policies and procedures for:
* configuration management, including the approval and testing of
scheduled and emergency changes, and monitoring procedures to ensure
compliance,
* maintaining current configuration information,
* authorizing, testing, approving, and tracking all configuration
changes,
* monitoring/auditing the configuration,
* patch management, vulnerability scanning, virus protection, emerging
threats, and user installed software, and,
* emergency changes.
Document:
2. Copy of System Development Life Cycle Methodology (SDLC).
Document:
3. Technical configuration standards for workstations, servers, related
network components, mobile devices, mainframes, operating systems, and
security software.
Document:
4. Description of configuration management software.
III. 4 IS General Controls- Segregation of Duties:
Segregation of duties refers to the policies, procedures, and
organizational structures that help ensure that no single individual
can independently control all key aspects of a process or computer-
related operation and thereby gain unauthorized access to assets or
records. Often, organizations achieve segregation of duties by dividing
responsibilities among two or more individuals or organizational
groups. This diminishes the likelihood that errors and wrongful acts
will go undetected, because the activities of one individual or group
will serve as a check on the activities of the other. Effective
segregation of duties includes segregating incompatible duties,
maintaining formal operating procedures, supervision, and review.
Relevant information for this control category includes the following.
Document:
1. Entitywide policies and procedures for � segregating duties. �
periodically reviewing access authorizations.
Document:
2. Management reviews conducted to determine that control techniques
for segregating incompatible duties are functioning as intended.
III.5 IS General Controls � Contingency Planning:
Contingency planning is critical to ensuring that when unexpected
events occur, key operations continue without interruption or are
promptly resumed and that critical and sensitive data are protected.
Critical elements for contingency planning include: assessing the
critical and sensitive computer activities and identifying supporting
resources, taking steps to minimize damage and interruption, developing
and documenting a comprehensive contingency plan, and periodically
testing the contingency plan and adjusting it as needed. Relevant
information for this control category includes the following.
Document:
1. Entitywide policies and procedures for:
* assessing the availability needs of entity systems,
* backing-up data, programs, and software, and,
* environmental controls, including emergency power, fire/smoke
detection and response, hardware maintenance and problem management,
alternate work sites, etc.
Document:
2. Documented contingency plan(s) and recent test results.
IV. IS Business Process Application Level Controls:
Business process application level controls are those controls over the
completeness, accuracy, validity and confidentiality of transactions
and data during application processing. The effectiveness of
application level controls is dependent on the effectiveness of
entitywide and system level general controls. Weaknesses in entitywide
and system level general controls can result in unauthorized changes to
business process applications and data that can circumvent or impair
the effectiveness of application level controls. Application level
controls are divided into the following four areas: application level
general controls, business process controls, interface controls, and
data management system controls. Relevant application specific
information for this control category includes the following.
Document:
1. Certification and accreditation, or equivalent, documentation for
relevant systems.
Document:
2. Documented security plans for relevant applications.
Document:
3. Documented risk assessments for relevant applications.
Document:
4. High-level schematic of application boundaries that identifies
controlled interfaces (e.g., gateways, routers, firewalls, encryption),
to include:
* internet presence,
* firewalls, routers, and switches,
* domain name servers,
* intrusion detection systems,
* critical systems, such as web and email servers, file transfer
systems, etc.
* network management systems,
* connectivity with other entity sites and other external
organizations,
* remote access � virtual private networks and dial-in, and,
Document:
5. Inventory of mid-level systems (Unix, Windows, etc.) supporting
applications being reviewed.
* operating systems/versions,
* security software/versions,
* list of systems/applications supported,
* data set naming conventions for the operating system, system
configuration, utility software, applications, and security software,
and,
* documentation of basic security configuration settings, i.e. Windows-
based, Unix.
Document:
6. Inventory of mainframe systems supporting applications being
reviewed, including:
* operating system/versions,
* security software/versions,
* IP addresses,
* description of each LPAR configuration, including list of user
applications and software installed on each LPAR,
* data set naming conventions for the operating system, system
configuration, utility software, applications, and security software,
* identity of Exits and SVCs, including load library and module name,
* documentation of basic security configuration settings, i.e. RACF,
Top Secret, or ACF2.
Document:
7. Documented test and evaluation covering relevant applications.
Document:
8. Corrective action plan for identified IS application control
weaknesses, including listing of weaknesses corrected.
Document:
9. Segregation of duties control matrices for job
functions/responsibilities.
Document:
10. Application contingency plan and related disaster recovery,
business continuity, and business resumption plans, including test
results.
Document:
11. Documentation on data validation and edit checks, including
auditing and monitoring processes.
Document:
12. Documentation describing interface strategy between applications,
including both manual and automated methods.
Document:
13. Documentation describing data management system used, including
access paths to this system, privileged accounts, and authentication
and authorization processes.
Document:
14. Policies and procedures for relevant application(s) being reviewed
that govern:
* operation of application controls,
* security and awareness training for employees and contractors,
* granting user application access,
* hiring, including reference and background checks, and job transfers
and terminations,
* security requirements and monitoring activities of third-party
providers supporting relevant applications,
* application user identification and authentication at the application
level,
* requesting and granting user access authorization to relevant
applications,
* collection, review, and analysis of access activities for
unauthorized or inappropriate access to relevant applications,
* configuration management process at the application level, including
the approval and testing of scheduled and emergency application program
changes and procedures to ensure compliance,
* backing-up relevant application data and programs,
* approval and review of data input, and,
* master file data configuration management and maintenance.
Document:
15. Documentation describing system output, format of the output, and
controls over the output.
[End of appendix]
Appendix II - Tables for Summarizing Work Performed in Evaluating and
Testing General and Business Process Application Controls:
These tables are provided for the auditor's use in performing the
audit. They are a consolidation of the tables of critical elements,
control activities, control techniques, and related suggested audit
procedures that are included after the discussion of each critical
element. To reduce documentation and allow the tables to be tailored to
individual audits, the tables will be available in electronic form from
GAO's World Wide Web server when the final FISCAM is issued. Our
Internet address is: [hyperlink, http://www.gao.gov].
These tables can be used as a guide during initial interviews and to
document the preliminary assessment of controls. As the audit
progresses, the auditor can continue to use the electronic version of
the tables to document controls evaluated and tested, test procedures
performed, conclusions, and supporting work paper references.
Note: For purposes of the Exposure Draft, only the first page is to
provide for illustration. The table will ultimately be populated with
the information in .the Control Techniques and Suggested Audit
Procedures tables in Chapters 3 and 4.
General Controls:
Table 3. Security Management:
Critical element and control activity:
SM-1. A security management program has been established.
SM-1.1. A security management program is developed, documented,
approved, and implemented.
Control technique:
SM-1.1.1. An entitywide security management program has been developed,
documented, and implemented. It covers all major facilities and
operations, has been approved by senior management and key affected
parties, covers the key elements of a security management program:
* periodic risk assessments;
* adequate policies and procedures;
* appropriate subordinate information security plans;
* security awareness training;
* management testing and evaluation;
* remedial action process;
Audit procedure:
Review documentation supporting the entitywide security management
program and discuss with key information security management and staff.
Determine whether the program:
* adequately covers the key elements of a security management program;
* is adequately documented, and;
* has been properly approved.
Determine whether all key elements of the program are implemented.
Consider audit evidence obtained during the course of the audit.
Entitywide level conclusion/reference:
System level conclusion/reference:
Application level conclusion/reference:
Overall conclusion/reference:
[End of appendix]
Appendix III - Tables for Assessing the Effectiveness of General and
Business Process Application Controls:
The tables in this appendix are provided for the auditor�s use in
recording the control effectiveness for each critical element in each
control category, as well as formulating an overall assessment of each
control category. Judging control effectiveness should be based on the
results of audit work performed and assessments of control
effectiveness for specific control techniques, as summarized in
Appendix II. After completing Appendix III, the auditor should prepare
a narrative summarizing the control effectiveness for general and
business process controls. The general control narrative should also
state whether or not audit work should be conducted to determine the
reliability of business process controls at the application level. To
reduce documentation and allow the tables to be tailored to individual
audits, the tables will be available in electronic form from GAO's
World Wide Web server when the final FISCAM is issued. Our Internet
address is: [hyperlink, http://www.gao.gov].
General Controls:
Security Management:
Critical elements: SM-1. Establish a security management program;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: SM-2. Periodically assess and validate risks;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: SM-3. Document security control policies and
procedures;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: SM-4. Implement effective security awareness of
other security-related personnel policies;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: SM-5. Monitor the effectiveness of the security
program;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: SM-6. Effectively remediate information security
weaknesses;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: SM-7. Ensure that activities performed by external
third parties are adequately secure;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of security management;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
[End of table]
Access Control:
Critical elements: AC-1. Adequately protect information system
boundaries;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AC-2. Implement effective identification and
authentication mechanisms;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AC-3. Implement effective authorization controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AC-4. Adequately protect sensitive system resources;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AC-5. Implement an effective audit and monitoring
capability;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AC-6. Establish adequate physical security controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of access controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
[End of table]
Configuration Management:
Critical elements: CM-1. Develop and document CM policies, plans, and
procedures;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: CM-2. Maintain current configuration identification
information;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: CM-3. Properly authorize, test, approve, and track
all configuration changes;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: CM-4. Routinely monitor the configuration;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: CM-5. Update the software on a timely basis to
protect against known vulnerabilities;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: CM-6. Appropriately document and approve emergency
changes to the configuration;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of configuration management.
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
[End of table]
Segregation of Duties:
Critical elements: SD-1. Segregate incompatible duties and establish
related policies;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: SD-2. Control personnel activities through formal
operating procedures, supervision, and review
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of segregation of duties;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
[End of table]
Contingency Planning:
Critical elements: CP-1. Assess the criticality and sensitivity of
computerized operations and identify supporting resources;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: CP-2. Take steps to prevent and minimize potential
damage and interruption;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: CP-3. Develop and document a comprehensive
contingency plan;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: CP-4. Periodically test the contingency plan and
adjust it as appropriate;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of contingency planning;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
[End of table]
Business Process Application Level Controls:
Application Level General Controls:
Critical elements: AS-1. Implement effective application security
management;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-1.1. Establish an application security plan;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-1.2. Periodically assess and validate application
security risks;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-1.3. Document and implement application security
policies and procedures;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-1.4. Implement effective security awareness and
other security-related personnel policies;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-1.5. Monitor the effectiveness of the security
program;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-1.6 Effectively remediate information security
weaknesses;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-1.7. Implement effective security-related
personnel policies;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-1.8. Adequately secure, document, and monitor
external third party activities;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of application security
management;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-2. Implement effective application access
controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-2.1. Adequately protect application boundaries;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-2.2. Implement effective identification and
authentication mechanisms;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-2.3. Implement effective authorization controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-2.4. Adequately protect sensitive system
resources;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-2.5. Implement an effective access audit and
monitoring capability;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-2.6. Establish adequate physical security
controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of access controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-3. Implement effective configuration management;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-3.1 Develop and document CM policies, plans, and
procedures;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-3.2. Maintain current configuration
identification information;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-3.3. Properly authorize, test, approve, and track
all configuration changes;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-3.4. Routinely monitor the configuration;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-3.5. Update systems in a timely manner to protect
against known vulnerabilities;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-3.6. Appropriately document and approve emergency
changes to the configuration;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of configuration management;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-4. Segregate user access to conflicting
transactions and activities and monitor segregation;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-4.1. Segregate user access to conflicting
transactions and activities;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-4.2. Monitor user access to conflicting
transactions and activities through formal operating procedures,
supervision, and review;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of segregation of duties;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-5. Implement effective application contingency
planning;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-5.1. Assess the criticality and sensitivity of
computerized operations and identify supporting resources;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-5.2. Take steps to prevent and minimize potential
damage and interruption;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-5.3. Develop and document a comprehensive
contingency plan;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: AS-5.4. Periodically test the contingency plan and
adjust it as appropriate;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of contingency planning;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
[End of table]
Business Process Controls:
Critical elements: BP-1 Transaction data input is complete, accurate,
valid, and confidential;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BD-1.1. Transaction data strategy is properly
defined, documented, and appropriate;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-1.2. Source documentation and input file data
collection and input preparation and entry is effectively controlled;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-1.3. Access to data input is adequately
controlled;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-1.4. Input data are approved;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-1.5. Input data are validated and edited to
provide reasonable assurance that erroneous data are detected before
processing;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-1.6. Input values to data fields that do not fall
within the tolerances or parameters determined by the management result
in an input warning or error;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-1.7. Error handling procedures during data
origination and entry reasonably assure that errors and irregularities
are detected, reported, and corrected;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-1.8. Errors are investigated and resubmitted for
processing promptly and accurately;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of transaction data input
controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2. Transaction data processing is complete,
accurate, valid, and confidential;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2.1. Application functionality is designed to
process input data, with minimal manual intervention;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2.2. Processing errors are identified, logged and
resolved;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2.3 Transactions are executed in accordance with
predetermined parameters and tolerances, specific to entity�s risk
management;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2.4. Transactions are valid and unique (not
duplicated);
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2.5 The transactions are appropriately
authorized;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2.6. Data from subsidiary ledgers are in balance
with the general ledger;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2.7. User-defined processing is adequately
controlled;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2.8. As appropriate, the confidentiality of
transaction data during processing is adequately controlled;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-2.9. An adequate audit and monitoring capability
is implemented;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of transaction data processing
controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-3. Transaction data output is complete, accurate,
valid, and confidential;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-3.1. Outputs are appropriately defined by the
management (output form, sensitivity of data, user selectivity,
confidentiality, etc.)
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-3.2. Output generation and distribution are
aligned with the reporting strategy;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-3.3. System generated outputs/reports are
reviewed to reasonable assure the integrity of production data and
transaction processing;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-3.4. Output/reports are in compliance with
applicable laws and regulations;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-3.5. Access to output/reports and output files is
based on business need and is limited to authorized users;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of data output controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-4. Master data setup and maintenance is
adequately controlled;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-4.1. Master data are appropriately designed;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-4.2 Changes to master data configuration are
appropriately controlled;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-4.3. Only valid master records exist;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-4.4. Master data are complete and valid;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-4.5. Master data are consistent among modules;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-4.6. Master data additions, deletions, and
changes are properly managed and monitored by data owners;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: BP-4.7. As appropriate, the confidentiality of
master data is adequately controlled;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of master data setup and
maintenance;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
[End of table]
Interface Controls:
Critical elements: IN-1. Implement an effective interface strategy and
design;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: IN-1.1. An interface strategy is developed for each
interface used in the application;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: IN-1.2. An interface design is developed for each
interface used in the application that includes appropriate detailed
specifications;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of interface strategy and design;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: IN-2. Implement effective interface processing
procedures
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: IN-2.1. Procedures are in place to reasonably assure
that the interfaces are processed accurately, completely, and timely;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: IN-2.2. Ownership for interface processing is
appropriately assigned;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: IN-2.3. The interfaced data is reconciled between
the source and target application to ensure that the data transfer is
compete and accurate;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: IN-2.4. Errors during interface processing are
identified by balancing processing and promptly investigated,
corrected, and resubmitted for processing;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: IN-2.5. Rejected interface data is isolated,
analyzed, and corrected in a timely manner;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: IN-2.6. Data files are not processed more than once;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of interface controls;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
[End of table]
Data Management System Controls:
Critical elements: DA-1. Implement an effective data management system
strategy and design;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: DA-1.1 Implement an effective data management system
strategy and design, consistent with the control requirements of the
application and data;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: DA-1.2. Detective controls are implemented in a
manner that effectively supports requirements to identify and react to
specific system or user activity within the data management system and
its related components;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: DA-1.3. Control of specialized data management
processes used to facilitate interoperability between applications
and/or functions not integrated into applications (such as ad-hoc
reporting) are consistent with control requirements for the
application, data and other systems that may be affected;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
Critical elements: Overall assessment of data management system
strategy and design;
Are controls effective? Yes, No, Partially:
Comments on control effectiveness:
Work paper references:
[End of table]
Assessment(s) on control effectiveness involving cross-cutting controls
issues:
Note: In assessing the effectiveness of general and business process
application controls, the auditor may find situations where weaknesses
identified solely in a specific control category (e.g., contingency
planning) may not reach the level that would justify concluding
controls to be ineffective for that particular category. However, when
the auditor considers control weaknesses identified in separate control
categories collectively, it may justify concluding controls to be
ineffective (cross-cutting). For example, the auditor may have
identified weaknesses indicating that the entity did not have a
complete inventory of all major systems (security management), the
system configuration baseline was incomplete (configuration
management), and all critical systems/activities for contingency
planning may not have been identified. In assessing these weaknesses
solely in the context of their respective control categories, the
auditor may have concluded that they did not reach the threshold to
assess each of these respective control categories as ineffective.
However, when the auditor assessed the weaknesses collectively, the
auditor may conclude controls to be ineffective since an incomplete
inventory of systems could significantly hamper the entity�s ability to
ensure that current and complete security settings are installed on all
systems and that contingency plans address each system in the event of
operational disruptions.
The space above is provided to document those assessments that are not
control category specific but are made from a collectively assessment
of weaknesses identified in separate control categories.
[End of appendix]
Appendix IV - Mapping of FISCAM to SP 800-53:
In table below, FISCAM is mapped to NIST Special Publication (SP) 800-
53. To assist auditors, the individual FISCAM general and business
process control activities are referenced to related NIST 800-53
controls.
FISCAM Controls: General Controls, Security Management:
SM-1. Establish a security management;
Related NIST 800-53 Controls:
PL-2 System Security Plan program;
PL-3 System Security Plan Update;
PL-6 Security-Related Activity Planning;
SA-2 Allocation of Resources.
SM-2. Periodically assess and validate risks;
Related NIST 800-53 Controls:
CA-4 Security Certification;
CA-6 Security Accreditation;
RA-2 Security Categorization;
RA-3 Risk Assessment;
RA-4 Risk Assessment Update.
SM-3. Document security control policies;
Related NIST 800-53 Controls:
See first control for each family and procedures (e.g., AC-1, AT-1).
SM-4. Implement effective security awareness and other security-related
personnel policies;
Related NIST 800-53 Controls:
AT-2 Security Awareness;
AT-3 Security Training;
AT-4 Security Training Records;
PL-4 Rules of Behavior;
PS-1 Personnel Security Policy awareness and other security-related and
Procedures personnel policies (continued);
PS-2 Position Categorization;
PS-3 Personnel Screening;
PS-4 Personnel Termination;
PS-5 Personnel Transfer;
PS-6 Access Agreements;
PS-7 Third-Party Personnel Security;
PS-8 Personnel Sanctions.
SM-5. Monitor effectiveness of the security program;
Related NIST 800-53 Controls:
CA-2 Security Assessments;
CA-7 Continuous Monitoring;
PL-5 Privacy Impact Assessment;
RA-5 Vulnerability Assessment.
SM-6. Effectively remediate information security weaknesses;
Related NIST 800-53 Controls:
CA-5 Plan of Action and Milestones.
SM-7. Ensure that activities performed by external parties third
parties are adequately secure;
Related NIST 800-53 Controls:
AC-20 Use of External Information Systems;
MA-4 Remote Maintenance;
PS-7 Third-Party Personnel Security;
SA-9 External Information System Services.
FISCAM Controls: Access Controls:
AC-1 Adequately protect information system boundaries;
Related NIST 800-53 Controls:
AC-4 Information Flow Enforcement;
AC-8 System Use Notification;
AC-9 Previous Logon Notification;
AC-11 Session Lock;
AC-12 Session Termination;
AC-17 Remote Access;
AC-18 Wireless Access Restrictions;
AC-19 Access Control for Portable and Mobile Devices;
CA-3 Information System Connections;
SC-7 Boundary Protection;
SC-10 Network Disconnect;
AC-2. Implement effective identification and authentication mechanisms;
Related NIST 800-53 Controls:
AC-7 Unsuccessful login attempts;
AC-10 Concurrent Session Control;
AC-14 Permitted Actions Without Identification and Authentication;
AU-10 Non-Repudiation;
IA-2 User Identification and Authentication;
IA-3 Device Identification and Authentication;
IA-4 Identified Management;
IA-5 Authentication Management;
IA-6 Authentication Feedback;
SC-17 Public Key Infrastructure Certificates;
SC-20 Secure Name/Address and Resolution Service (Authoritative
Source);
SC-21 Secure Name Address Resolution Service;
SC-22 Architecture and Provisioning for Name/Address Resolution
Service;
SC-23 Session Authenticity.
AC-3. Implement effective authorization controls;
Related NIST 800-53 Controls:
AC-2 Account Management;
AC-3 Access Enforcement;
AC-6 Least Privilege;
CM-7 Least Functionality;
SC-6 Resource Priority;
SC-14 Public Access Protections;
SC-15 Collaborative Computing.
AC-4. Adequately protect sensitive system resources;
Related NIST 800-53 Controls:
AC-15 Automated Markings;
AC-16 Automated Labeling;
IA-7 Cryptographic Module Authentication;
MP-2 Media Access;
MP-3 Media Labeling;
MP-4 Media Storage;
MP-5 Media Transport;
MP-6 Media Sanitation and Disposal;
PE-19 Information Leakage;
SC-2 Application Partitioning;
SC-3 Security Function Isolation;
SC-4 Information Remnance;
SC-8 Transmission Integrity;
SC-9 Transmission Confidentiality;
SC-11 Trusted Path;
SC-12 Cryptographic Key Establishment and Management;
SC-13 Use of Cryptography;
SC-16 Transmission of Security Parameters SC-18 Mobile Code.
AC-5. Implement an effective audit and monitoring capability;
Related NIST 800-53 Controls:
AC-13 Supervision and Review � Access Control;
AT-5 Contacts with Security Groups and Associations;
AU-2 Auditable Events AU-3 Content of Audit Records;
AU-4 Audit Storage Capacity;
AU-5 Response to Audit Processing Failures;
AU-6 Audit Reduction and Report Generation;
AU-7 Audit Reduction and Report Generation;
AU-8 Time Stamps;
AU-9 Protection of Audit Information;
AU-11 Audit Record Retention;
IR-1 Incident Response Policy;
IR-2 Incident Response Training;
IR-3 Incident Response Testing;
IR-4 Incident Handling;
IR-5 Incident Monitoring;
IR-6 Incident Reporting;
IR-7 Incident Response Assistance;
SC-5 Denial of Service Protection;
SI-4 Information System Monitoring Tools and Techniques;
SI-6 Security Functionality Verification.
AC-6 Establish adequate physical security controls;
Related NIST 800-53 Controls:
PE-2 Physical Access Authorization;
PE-3 Physical Access Control;
PE-4 Access Control for Transmission Medium;
PE-5 Access Control Policy for Display Medium;
PE-6 Monitoring Physical Access;
PE-7 Visitor Control;
PE-8 Access Records.
FISCAM Controls: Configuration Management:
CM-1. Develop and document CM policies, plans, and procedures;
Related NIST 800-53 Controls:
CM-1 Configuration Management Policy and Procedures.
CM-2. Maintain current configuration identification information;
Related NIST 800-53 Controls:
CM-2 Baseline Configuration;
CM-6 Configuration Settings;
CM-8 Information System Component Inventory;
SA-5 Information System Documentation.
CM-3. Properly authorize, test, approve, track and control all
configuration changes;
Related NIST 800-53 Controls:
CM-3 Configuration Change Control;
SA-2 Allocation Resources;
SA-3 Life Cycle Support;
SA-4 Acquisitions;
SA-8 Security Engineering Principles;
SA-10 Developer Configuration management;
SA-11 Developer Security Testing.
CM-4. Routinely monitor the configuration;
Related NIST 800-53 Controls:
CM-4 Monitoring configuration Changes;
CM-5 Access Restrictions for Change;
SI-7 Software and Information Integrity.
CM-5. Update software on a timely basis to protect against known
vulnerabilities;
Related NIST 800-53 Controls:
RA-5 Vulnerability Scanning;
SA-6 Software Usage Restrictions;
SA-7 User Installed Software;
SC-19 Voice Over Internet Protocol;
SI-2 Flaw Remediation;
SI-3 Malicious Code Protection;
SI-5 Security Alerts and Advisories;
SI-8 Spam Protection.
CM-6 Appropriately document and approve emergency changes to the
configuration.
FISCAM Controls: Segregation of Duties:
SD-1 Segregate incompatible duties and establish related policies;
Related NIST 800-53 Controls:
AC-5 Separation of Duties;
PS-2 Position Categorization;
PS-6 Access Agreements.
SD-2 Control personnel activities through formal operating procedures,
supervision, and review;
Related NIST 800-53 Controls:
AC-5 Separation of Duties;
PS-2 Position Categorization;
PS-6 Access Agreements
FISCAM Controls: Contingency Planning:
CP-1 Assess the criticality and sensitivity of computerized operations
and identify supporting resources.
CP-2. Take steps to prevent and minimize potential damage and
interruption;
Related NIST 800-53 Controls:
CP-3 Contingency Training;
CP-6 Alternate Storage Site;
CP-7 Alternate Processing Site;
CP-9 Information System Backup;
CP-10 Information System Recovery and Backup;
MA-2 Controlled Maintenance;
MA-3 Maintenance Tools;
MA-5 Maintenance Personnel;
MA-6 Timely Maintenance;
PE-9 Power Equipment and Power Cabling;
PE-10 Emergency Shutoff;
PE-11 Emergency Power;
PE-12 Emergency Lighting;
PE-13 Fire Protection;
PE-14 Temperature and Humidity Controls;
PE-15 Water Damage Protection;
PE-16 Delivery and Removal;
PE-17 Alternate Work Site;
PE-18 Location of Information System Documentation;
SA-5 Information System Documentation.
CP-3. Develop and document a comprehensive contingency plan;
Related NIST 800-53 Controls:
CP-2 Contingency Plan;
CP-5 Contingency Plan Update;
CP-8 Telecommunications services.
CP-4. Periodically test the contingency plan and adjust it as
appropriate;
Related NIST 800-53 Controls:
CP-4 Contingency Plan Testing and Exercise;
CP-5 Contingency Plan Update.
FISCAM Controls: Business Process Application Level Controls:
Application Level General Controls:
AS-1. Implement effective application security management;
Related NIST 800-53 Controls:
The related NIST SP 800-53 application level general controls are
identified under related General Controls above.
AS-2. Implement effective application access controls.
AS-3. Implement effective application configuration management.
AS-4. Segregate application user access to conflicting transactions and
activities and monitor segregation.
AS-5. Implement effective application contingency planning.
FISCAM Controls: Business Process Controls:
BP-1. Transaction data input is complete, accurate, valid, and
confidential;
Related NIST 800-53 Controls:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
BP-2. Transaction data processing is complete, accurate, valid, and
confidential;
Related NIST 800-53 Controls:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
BP-3. Transaction data output is complete, accurate, valid, and
confidential;
Related NIST 800-53 Controls:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling;
SI-12 Information Output Handling and Retention.
BP-4. Master data setup and maintenance is adequately controlled;
Related NIST 800-53 Controls:
SI-9 Information Input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
FISCAM Controls: Interface controls:
IN-1 Implement an effective interface strategy and design;
Related NIST 800-53 Controls:
SI-9 Information input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
IN-2 Implement effective interface processing procedures;
Related NIST 800-53 Controls:
SI-9 Information input Restrictions;
SI-10 Information Accuracy, Completeness, Validity, and Authenticity;
SI-11 Error Handling.
FISCAM Controls: Data management controls:
DA-1. Implement an effective data management system strategy and
design;
Related NIST 800-53 Controls:
[End of table]
[End of appendix]
Appendix V - Knowledge, Skills, and Abilities Needed to Perform
Information System Controls Audits:
Information system (IS) controls audits require a broad range of
technical skills. A key component of planning is determining the
knowledge, skills, and abilities needed to perform the IS audit. Such
needs are then compared with the audit team�s current knowledge,
skills, and abilities to identify any expertise that must be acquired.
Any expertise gap can be filled through hiring, training, contracting,
or staff sharing. The knowledge, skills, and abilities described in
this appendix are not intended to be prescriptive, but to provide a
framework to assist the auditor in determining the audit resources
needed to effectively perform audit procedures in an IS audit. In
addition, when contracting for IS audit services, this framework may be
used as resource to identify the specific knowledge, skills, and
abilities that will be needed to perform the contracting services
requested.
Generally accepted government auditing standards (GAGAS) state that the
�staff assigned to conduct an audit or attestation engagement under
GAGAS must collectively possess the technical knowledge, skills, and
experience necessary to be competent for the type of work being
performed before beginning work on that assignment.� The standards
further require that if the work involves a review of information
systems, the staff assigned to the GAGAS audit engagement should
collectively possess knowledge of information technology.
[Footnote 97]These skills are often described in terms of knowledge,
skills, and abilities (KSAs). KSAs are typically used in job position
descriptions and job announcements to describe the attributes required
for those in particular jobs. These terms are defined as follows:
Knowledge�the foundation upon which skills and abilities are built.
Knowledge is an organized body of information, facts, principles, or
procedures that, if applied, make adequate performance of a job
possible. An example is knowledge of tools and techniques used to
establish logical access control over an information system.
Skill�the proficient manual, verbal, or mental manipulation of people,
ideas, or things. A skill is demonstrable and implies a degree of
proficiency. For example, a person may be skilled in operating a
personal computer to prepare electronic spreadsheets or in using a
software product to conduct an automated review of the integrity of an
operating system.
Ability�the power to perform a job function while applying or using the
essential knowledge. Abilities are evidenced through activities or
behaviors required to do a job. An example is the ability to apply
knowledge about logical access controls to evaluate the adequacy of an
organization�s implementation of such controls.
A staff member�s knowledge, skills, and abilities can be categorized in
accordance with FISCAM audit areas. Table 1 includes an overview of the
knowledge, skills, and abilities that a team typically needs to
effectively perform an IS audit. It assumes a level of proficiency in
performing basic auditing tasks, such as interviewing, gathering and
documenting evidence, communicating both orally and in writing, and
managing projects. It focuses on attributes associated specifically
with IS auditing. Although each staff member assigned to such an audit
need not have all these attributes, the audit team must collectively
possess the KSA�s necessary to perform the audit, including adequately
planning the audit, assessing the effectiveness of IS controls, testing
IS controls, determining the effect of the results of testing on the
audit objectives, developing findings and recommendations, and
reporting the results. Audit resources may be supplemented from outside
the organization through partnering or engaging consultants.
Table 1. Knowledge, Skills, and Abilities for IS Security Audit Areas
by FISCAM Objective:
FISCAM objective: Security Management;
Associated knowledge, skills, and abilities:
* Knowledge of the legislative requirements for an entity�s information
security management program;
* Knowledge of the sensitivity of data and the risk management process
through risk assessment and risk mitigation;
* Knowledge of the risks associated with a deficient information
security management program;
* Knowledge of the key elements of a good information security
management program;
* Ability to analyze and evaluate an entity�s security policies and
procedures and identify their strengths and weaknesses;
* Ability to analyze and evaluate the entity�s security management
program and identify the strengthens and weaknesses, including:
- security management program, structure, and responsibilities,
including system inventories;
- risk assessment;
- security awareness training for employees, contractors, third parties
(including those in sensitive security and data processing position)
and security-related personnel policies (including personnel hiring,
including reference and background checks, and job transfers and
terminations);
- performance of periodic tests and evaluations of IS controls and
monitoring to ensure compliance with established policies and
procedures (including copies of tests and evaluations performed), and;
- security requirements and monitoring activities of third-party
providers supporting specific application(s).
FISCAM objective: Access Control;
Associated knowledge, skills, and abilities:
* Knowledge across platforms of the access paths into computer systems
and of the functions of associated hardware and software that provides
an access path;
* Knowledge of access level privileges granted to users and the
technology used to provide and control them;
* Knowledge of the procedures, tools, and techniques that provide for
good physical, technical, and administrative controls over access;
* Knowledge of the risks associated with inadequate access controls;
* Skills to perform vulnerability assessments of the entity�s
applications and supporting computer systems;
* Ability to analyze and evaluate the entity�s access controls and
identify the strengthens and weaknesses, including:
- system boundaries;
- controlling remote access to agency information, including use of
remote devices;
- user and system identification and authentication;
- requesting, approving, and periodically reviewing user access
authorization;
- restricting access to sensitive system resources (including system
utilities, system software, and privileged accounts);
- protecting digital and sensitive media, including portable media;
- applying cryptography methods, if used;
- monitoring mainframe, mid-level servers, and network systems for
incidents, including management response and reporting on unusual
activities, intrusion attempts, and actual intrusions, and;
- controlling physical security, including granting and controlling of
physical access to the data center and other IT sensitive areas.
FISCAM objective: Configuration Management;
Associated knowledge, skills, and abilities:
* Knowledge of the concept of configuration management and the System
Development Life Cycle (SDLC) process;
* Knowledge of baseline configuration management procedures, tools, and
techniques that provide control over application and system software,
and computer security settings;
* Knowledge of the risks associated with the modification, including
emergency changes, of application and system software, and computer
security settings;
* Knowledge of the risks associated with inadequate procedures for
updating software to protect against known vulnerabilities;
* Ability to analyze and evaluate the entity�s configuration management
and identify the strengths and weaknesses, including:
- configuration management policies, including the approval and testing
of scheduled and emergency changes, and monitoring procedures to ensure
compliance,
- maintaining current configuration information,
- authorizing, testing, approving, and tracking all configuration
changes,
- monitoring/auditing the configuration,
- patch management, vulnerability scanning, virus protection, emerging
threats, and user installed software, and,
- emergency changes.
FISCAM objective: Segregation of Duties;
Associated knowledge, skills, and abilities:
* Knowledge of the different functions involved with information
systems and data processing and incompatible duties associated with
these functions;
* Knowledge of the risks associated with inadequate segregation of
duties;
* Ability to analyze and evaluate the entity�s organizational structure
and segregation of duties (including periodic review of access
authorizations) and identify the strengths and weaknesses.
FISCAM objective: Contingency Planning;
Associated knowledge, skills, and abilities:
* Knowledge of the procedures, tools, and techniques that provide for
contingency planning and business continuity;
* Knowledge of the risks that exist when measures are not taken to
provide for contingency planning and business continuity;
* Ability to analyze and evaluate an entity�s contingency planning
program and contingency plans for business continuity and identify the
strengths and weaknesses, including:
- assessing the availability needs of entity systems;
- backing-up data, programs, and software, and;
- environmental controls, including emergency power, fire/smoke
detection and response, hardware maintenance and problem management,
alternate work sites, etc.
FISCAM objective: Business Process Controls;
Associated knowledge, skills, and abilities:
* Knowledge about the practices, procedures, and techniques that
provide for the completeness, accuracy, validity, and confidentiality
of application data;
* Knowledge of typical applications in each business process
transaction cycle;
* Skills to use a generalized audit software package to conduct data
analyses and tests of application data, and to plan, extract, and
evaluate data samples;
* Ability to analyze and evaluate the entity�s application controls and
identify the strengths and weaknesses.
Source: GAO.
[End of table]
Auditors performing tasks in two of the above FISCAM areas�Access
Controls and Configuration Management�require additional specialized
technical skills. Such technical specialists should have skills in one
or more of the categories listed in table 2.
Table 2. KSAs for Information Security Technical Specialists:
Specialist: Network analyst;
Skills:
* Advanced knowledge of network hardware and software;
* Understanding of data communication protocols;
* Ability to evaluate the configuration of routers, firewalls, and
intrusion detection systems;
* Ability to perform external and internal vulnerability tests with
manual and automated tools;
* Knowledge of the operating systems used by servers.
Specialist: Windows/Novell analyst;
Skills:
* Detailed understanding of microcomputer and network architectures;
* Ability to evaluate the configuration of servers and the major
applications hosted on servers;
* Ability to perform internal vulnerability tests with manual and
automated tools.
Specialist: Unix analyst;
Skills:
* Detailed understanding of the primary variants of the Unix
architectures;
* Ability to evaluate the configuration of servers and the major
applications hosted on servers;
* Ability to perform internal vulnerability tests with manual and
automated tools.
Specialist: Database analyst;
Skills:
* Understanding of the control functions of the major database
management systems;
* Understanding of the control considerations of the typical
application designs that use database systems;
* Ability to evaluate the configuration of major database software
products.
Specialist: Mainframe system software analyst;
Skills:
* Detailed understanding of the design and function of the major
components of the operating system;
* Ability to develop or modify tools necessary to extract and analyze
control information from mainframe computers;
* Ability to use audit software tools;
* Ability to analyze modifications to system software components.
Specialist: Mainframe access control analyst;
Skills:
* Detailed understanding of auditing access control security software
such as ACF2, Top Secret, and RACF;
* Ability to analyze mainframe audit log data;
* Ability to develop or modify tools to extract and analyze access
control information.
Source: GAO.
[End of table]
As table 2 shows, some activities require a high degree of IT
knowledge, skills, and abilities, while others involve more basic
auditing tasks (interviewing, gathering background information, and
documenting the IT security environment). Audit management may
therefore want to organize staff that have highly specialized technical
skills into a separate group that has access to special-purpose
computer hardware and software. A group of this kind can focus on more
technical issues, while other groups within the organization can
perform the less technical work.
[End of appendix]
Appendix VI - Scope of an Information System Controls Audit in Support
of a Financial Audit:
This appendix provides a framework for assessing the effectiveness of
information system controls audits in support of financial statement
audits. Given the prevalence of the use of information systems to
process financial information, performing a financial audit generally
includes an assessment of the effectiveness of information system
controls. The information system controls audit should be performed as
an integral part of the financial audit.
This appendix is intended to assist (1) financial auditors in
communicating audit requirements to IS control specialists, and (2)
financial auditors and IS control specialists in understanding how an
assessment of the effectiveness of IS controls integrates with
financial audit requirements.
The Government Accountability Office (GAO) and the President�s Council
on Integrity and Efficiency (PCIE) Financial Audit Manual (FAM)
presents a methodology for performing financial statement audits of
federal entities in accordance with professional standards. Chapter 2
(and related steps in Chapter 4) of the FISCAM describe a methodology
for performing the IS controls audit in the context of an audit
performed in accordance with generally accepted government auditing
standards (GAGAS). This appendix discusses how the audit steps
described in Chapter 2 of the FISCAM (and related steps in Chapter 4)
provide more specific guidance concerning the evaluation of the
effectiveness of information systems controls in support of the audit
steps in the FAM. For financial audits performed in accordance with the
FAM, the steps in the FISCAM should be performed in coordination with
the related steps in the FAM. The flowchart of steps in assessing IS
controls in a financial statement audit, appearing in FAM 295 J, is
presented at the end of this appendix.
The following table presents a summary of the relationship between
selected FAM steps and related FISCAM steps.
Audit Planning:
FAM Step(s):
220 Understand the Entity�s Operations;
235 Identify Significant Line Items, Accounts, Assertions, and RSSI;
240 Identify Significant Cycles, Accounting Applications, And Financial
Management Systems;
Related FISCAM Step(s):
2.1.1 Planning the Information System Controls Audit�Overview;
2.1.2 Understand the Overall Audit Objectives and Related Scope of the
Information System Controls Audit;
2.1.3 Understand the Entity�s Operations and Key Business Processes;
2.1.4 Obtain a General Understanding of the Structure of the Entity�s
Networks;
2.1.5 Identify Key Areas of Audit Interest (files, applications,
systems, locations).
FAM Step(s):
260 Identify Risk Factors;
Related FISCAM Step(s):
2.1.6 Assess Information system Risk on a Preliminary Basis.
FAM Step(s):
270 Determine Likelihood of Effective IT System Controls
Related FISCAM Step(s):
2.1.7 Identify Critical Control Points (for example, external access
points to networks);
2.1.8 Obtain a Preliminary Understanding of Information System
Controls.
FAM Step(s):
Miscellaneous FAM planning sections;
Related FISCAM Step(s):
2.1.9 Perform Other Audit Planning Procedures.
Internal Control Testing:
FAM Step(s):
310 Overview of the Internal Control Phase;
320 Understand Information Systems;
330 Identify Control Objectives;
340 Identify and Understand Relevant Control Activities;
350 Determine the Nature, Timing, and Extent of Control Tests And Of
Tests For Systems� Compliance With FFMIA Requirements;
360 Perform Nonsampling Control Tests And Tests For Systems� Compliance
With FFMIA Requirements, including 360.03-.09--Test IT System Controls;
Related FISCAM Step(s):
2.2 Perform Information System Controls Audit Tests:
* Understand Information Systems Relevant to the Audit Objectives;
* Identify IS Control Techniques Relevant to the Audit Objectives;
* Test IT System Controls.
Reporting The Results Of The Is Controls Audit:
FAM Step(s):
370 Assess Controls On A Preliminary Basis;
580 Draft Reports � Internal Control;
Related FISCAM Step(s):
2.3 Report Audit Results.
Audit Planning:
IS Audit Resources:
As discussed in FAM Section 110.27, the audit team should possess
sufficient knowledge of IS controls to determine the effect of IT on
the audit, to understand IS controls, and to consult with an IS
controls specialist [Footnote 98] to design and test IS controls.
Specialized IS audit skills generally are needed in situations where:
* the entity�s systems, automated controls, or the manner in which they
are used in conducting the entity�s business are complex;
* significant changes have been made to existing systems or new systems
have been implemented;
* data are extensively shared among systems;
* the entity participates in electronic commerce;
* the entity uses emerging technologies; or;
* significant audit evidence is available only in electronic form.
In some cases, the financial auditor may consult with IS controls
specialists within the audit organization or use outside contractors to
provide these skills. However, per AU 311.22, the financial auditor
should have sufficient knowledge to communicate the objectives of the
specialists� work, to evaluate whether the specified procedures will
meet the audit objectives, and to evaluate the results of the
procedures as they relate to the nature, extent, and timing of further
planned audit procedures.
Appendix V of the FISCAM provides a framework to assist the auditor in
determining the audit resources needed to effectively perform an IS
controls audit. In addition, when contracting for IS systems audit
services, this framework may be used as a resource to identify the
specific knowledge, skills, and abilities that will be needed to
perform the contracting services requested. Section 2.1.9.C ��Audit
Resources�� in Chapter 2 provides additional information on the use of
IS controls specialists in a GAGAS audit.
The following sections discuss IT-related FAM steps and the related
FISCAM steps.
Understand the Entity's Operations, Identify Significant Line Items,
Accounts, Assertions, and RSSI, and Identify Significant Cycles,
Accounting Applications, and Financial Management Systems:
FAM 220.01 states that the auditor must obtain an understanding of the
entity and its environment, including internal control to assess the
risk of material misstatement of the financial statements, whether due
to error or fraud, and to design the nature, extent, and timing of
further audit procedures. The following IT-related FAM sections discuss
obtaining an understanding of the entity�s operations and information
systems:
* 220.04--the auditor should identify significant external and internal
factors that affect the entity�s operations as part of understanding
the entity and its environment for purposes of planning the audit,
including the IT structure and the extent to which IT processing is
performed externally such as through cross-servicing agreements.
* 220.07--the auditor should develop and document a high-level
understanding of the entity�s use of IS controls and how IT affects the
generation of financial statement information and supplementary
information. An IS controls specialist may assist the auditor in
understanding the entity�s use of IS controls. Appendix I of the FISCAM
may be used to document this understanding.
* 235.01--the auditor should identify significant line items and
accounts in the financial statements and significant related financial
statement assertions.
* 240.08--once the auditor identifies significant accounting
applications, the auditor should determine which information systems
are involved in those applications.
* 240.09--the auditor should obtain sufficient knowledge of the
information systems relevant to financial reporting to understand the
accounting processing from initiation of a transaction to its inclusion
in the financial statements, including electronic means used to
transmit, process, maintain, and access information (see AU 319.49, SAS
No. 94).
The following FISCAM sections (Chapter 2) provide more specific
guidance on how the auditor obtains an understanding of the entity�s IT
operations and information systems:
* Planning the information system controls audit�overview � 2.1.1;
* Understand the entity�s operations and key business processes -
2.1.3;
* Obtain a general understanding of the structure of the entity�s
networks � 2.1.4;
* Identify key areas of audit interest (files, applications, systems,
locations) � 2.1.5.
More specifically, based on the audit objectives and the auditor�s
understanding of the business processes and networks, the auditor�s
identification of key areas of audit interest includes:
* key business process applications and where each key business process
application is processed;
* key data files used by each key business application, and;
* relevant general controls at the entitywide and system levels, upon
which application level controls depend.
These FISCAM sections include information related to the IS controls
audit that should be included in audit documentation. Such information
should be summarized, as appropriate, in the entity profile or an
equivalent document, as discussed in FAM Section 290.04. However, the
auditor generally should document internal control separately as
discussed below and in FAM 390.
Identify Risk Factors:
FAM Section 260.09 states that the auditor should (1) identify
conditions that significantly increase inherent, fraud, and control
risk (based on identified control environment, risk assessment,
communication, or monitoring weaknesses) and (2) conclude whether any
identified control risks preclude the effectiveness of specific control
activities in significant applications. The auditor should identify
specific inherent risks, fraud risks, and control environment, risk
assessment, communication, and monitoring weaknesses based on
information obtained in the planning phase, primarily from
understanding the entity�s operations, including significant IT
processing performed outside the entity and preliminary analytical
procedures. SAS No. 70 reports, which are discussed further in FAM 310
and in Appendix VII, may be prepared by service auditors for
organizations performing significant IT processing for the entity. The
auditor may find these reports useful for performing risk assessments
and planning other audit procedures. The auditor should update the risk
assessment throughout the audit.
FAM Section 260.22 states that IS controls do not affect the audit
objectives for an account or a cycle. However, IS controls can
introduce inherent risk factors not present in a manual accounting
system. The FAM section states that the auditor should assess the
overall impact of IS processing on inherent risk. The impact of these
factors typically will be pervasive in nature. An IS controls
specialist may assist the auditor in considering these factors and
making this assessment.
FAM Section 260.56 states that IS controls affect the effectiveness of
control activities, the control environment, risk assessment,
communication, and monitoring. For example, controls that normally
would be performed by separate individuals in manual systems may be
concentrated in one computer application and pose a potential
segregation-of-duties issue. See SAS No. 109.57-63 for further
discussion of the effect of IT on internal control.
FAM Section 260.57 provides several IS factors, discussed in Chapter 2
of the FISCAM, that the auditor should evaluate in making an overall
assessment of the control environment, risk assessment, communication,
and monitoring.
The FISCAM section 2.1.6 entitled ��Assess Information System Risk on a
Preliminary Basis� provides more specific guidance on how the auditor
identifies IS risk (inherent and the control environment, risk
assessment, communication, and monitoring components of internal
control). Also, the FISCAM section 2.1.9.B entitled ��Consideration of
the Risk of Fraud�� provides more specific guidance concerning
identification of the risk of fraud arising from IT, including
coordination between the financial auditor and the IS controls
specialist. In addition, the FISCAM section 2.5.1 �Additional IS Risk
Factors� provides more risk factors for the auditor to consider.
Further, FISCAM Appendix VII provides more information on the use of
SAS 70 reports.
These FISCAM sections include information that should be included in
audit documentation. In addition, such information should be
summarized, as appropriate, in the GRA or equivalent document as
discussed in FAM Section 290, including:
* the assessments of overall inherent risk and the risk factors
considered in the assessment, and;
* the assessments of the overall effectiveness of the control
environment, risk assessment, communication, and monitoring, including
whether an ineffective control environment precludes the effectiveness
of specific control activities.
Determine Likelihood of Effective IS Controls:
As discussed in FAM 270, information system (IS) controls consist of
those internal controls that are dependent on information systems
processing and include general, business process application, and user
controls. IS controls consist of those internal controls that are
dependent on information systems processing and include general
controls (entitywide, system, and business process application levels),
business process application controls (input, processing, output,
master file, interface, and data management system controls), and user
controls (controls performed by people interacting with information
systems). General and business process application controls are always
IS controls. A user control is an IS control if its effectiveness
depends on information systems processing or the reliability (accuracy,
completeness, and validity) of information processed by information
systems. Conversely, a user control is not an IS control if its
effectiveness does not depend on information systems processing or the
reliability of information processed by information systems.
In the financial audit planning phase, the auditor, with the assistance
of an IS control specialist should determine whether IS controls are
likely to be effective and should therefore be considered in the
internal control phase. The auditor may coordinate work done to meet
the provisions of FISMA with work done as part of the financial
statement audit.
The procedures performed to determine the likelihood of effective IS
controls build on those procedures performed while understanding the
entity�s operations and assessing the effects of IS controls on
inherent risk and the control environment, risk assessment,
communication, and monitoring. Under SAS No. 109, the auditor should
sufficiently understand each of the five components of internal control-
control environment, risk assessment, information and communication,
monitoring, and control activities-to assess the risk of material
misstatement. This understanding should include relevant IS aspects.
As discussed in FAM 260.06, the auditor evaluates and tests the
following types of controls in a financial statement audit:
* financial reporting controls,
* compliance controls, and,
* certain operations controls (to the extent described in FAM 275).
For each of the specific controls to be evaluated and tested, as
documented in the SCE Form or equivalent, the auditor should
distinguish which are IS controls. In addition, based on such IS
controls and the audit planning procedures (particularly the
identification of critical control points), the auditor should identify
those other IS controls (general and business process application
controls) upon which the effectiveness of the controls in the SCE
depend. These other IS controls also need to be effective for the
specific controls in the SCE to be effective. FISCAM Appendices II and
III can be used to document such controls.
IS controls can be classified into three types:
* general controls � GAGAS defines information systems general controls
as the policies and procedures that apply to all or a large segment of
an entity�s information systems. General controls help ensure the
proper operation of information systems by creating the environment for
proper operation of application controls. General controls include
security management, logical and physical access, configuration
management, segregation of duties, and contingency planning.
* business process application controls �GAGAS defines application
controls, sometimes referred to as business process controls, as those
controls that are incorporated directly into computer applications to
help ensure the validity, completeness, accuracy, and confidentiality
of transactions and data during application processing. Application
controls include controls over input, processing, output, master data,
application interfaces, and data management system interfaces.
* user controls � portions of controls that are performed by people
interacting with IS controls. The effectiveness of user controls
typically depend on the accuracy of the information produced by the IS
controls.
An IS controls specialist generally should review and concur with the
auditor�s identification of IS controls.
Testing of technical IS controls should be performed by an IS controls
specialist as described in FAM 360. The audit team may work with the IS
controls specialist by testing user controls and application controls
involving manual follow-up.
FAM Section 270.05 states that early in the audit�s planning phase, the
auditor and the IS controls specialist should understand the design of
each of the three types of IS controls (general, business process
application level, and user controls) to the extent necessary to
tentatively conclude whether these controls are likely to be effective.
If they are likely to be effective, the auditor should consider
specific IS controls in determining whether control objectives are
achieved in the internal control phase. As discussed in SAS No. 109.54,
evaluating the design of a control involves considering whether the
control, individually or in combination with other controls, is capable
of effectively preventing, detecting, and correcting material
misstatements.
If IS controls are not likely to be effective, the auditor, with the
assistance of the IS controls specialist, should obtain a sufficient
understanding of control risks arising from IS controls to:
* identify types of potential misstatements,
* consider factors that affect the risks of material misstatement,
* design tests of controls and substantive procedures, and,
* develop appropriate findings.
Also, in the internal control phase, the auditor generally should focus
on the effectiveness of manual controls in achieving control
objectives, including manual controls that may mitigate weaknesses in
IS controls. If IS controls are not likely to be effective due to poor
general controls and if manual controls do not achieve the control
objectives, the auditor should identify and evaluate any specific IS
controls that are designed to achieve the control objectives to develop
recommendations for improving internal controls.
As discussed in SAS No. 109.117-.120, in some circumstances, such as
where a significant amount of information is electronically initiated,
recorded, processed, and reported, it may not be practical or possible
to restrict detection risk to an acceptable level by performing only
substantive tests for one or more financial statement assertions. In
such circumstances, the auditor should test IS controls to obtain
evidential matter about the effectiveness of both the design and
operation of controls to reduce the assessed level of the risk of
material misstatement.
The following FISCAM sections provide more specific guidance on how the
auditor determines the likelihood of effective IS controls:
* Identify critical control points (for example, external access points
to networks) � 2.1.7;
* Obtain a preliminary understanding of information system controls �
2.1.8.
These FISCAM sections include information that should be included in
audit documentation. In addition to this audit documentation, as
discussed in FAM Section 290, the auditor should document tentative
conclusions on the likelihood that IT controls and any compensating
controls such as manual controls, reviews, or reconciliations are
operating effectively.
Other Audit Planning Procedures:
The FISCAM section 2.1.9 provides additional information concerning the
following planning steps in the IS controls audit that should be
coordinated with the financial audit.
* Relevant laws and regulations�this section provides more specific
guidance on how the auditor identifies significant IT related
provisions of laws and regulations and should be performed in
coordination with FAM Section 245.
* Consideration of the risk of fraud�as discussed above, this section
provides more specific guidance on how the auditor identifies the risk
of fraud arising from IT, including coordination between the financial
auditor and the IS controls specialist, and should be performed in
coordination with FAM Section 260.
* Audit Resources�as discussed above, this section provides more
specific guidance on how the auditor identifies the knowledge, skills,
and abilities needed to perform an IS controls audit and the auditor�s
responsibilities and procedures for using the work of an IS controls
specialist, and should be performed in coordination with FAM Section
110.
* Multiyear testing plans�this section provides more specific guidance
on how the auditor establishes a multiyear testing plan for IS
controls, and should be performed in coordination with FAM Section
395G.
* Communication with entity management and those charged with
governance�this section provides more specific guidance on
communicating relevant IT-related information with entity management
and those charged with governance, and should be performed in
coordination with FAM Section 215.
* Service organizations�this section provides more specific guidance on
the auditor�s consideration of IS controls, significant to the IS
audit, that are performed by a service organization. This issue is
discussed further in Appendix VII �Entity�s Use of Service
Organizations�. This section should be performed in coordination with
FAM 310.
* Using the work of others�this section provides more specific guidance
on how the auditor prepares uses the work of others in performing the
IS controls audit, and should be performed in coordination with FAM
section 650.
* Audit plan�this section provides more specific guidance on how the
auditor prepares an audit plan and strategy for performing the IS
controls audit, and should be performed in coordination with FAM
section 290.
Also the FISCAM provides more specific guidance on how the auditor
documents the planning of the IS controls audit, and should be
performed in coordination with FAM Section 290.
Internal Control Testing:
Overview:
In general, FAM Section 300 describes the methodology for assessing the
effectiveness of internal control in a financial audit. FAM Section 310
summarizes the methodology. Specifically, Section 310 states that, in
the internal control phase, the auditor should gain an understanding of
internal control and obtain evidence about the effectiveness of
internal control to (1) assess control risk, (2) determine the nature,
timing, and extent of control, compliance, and substantive testing, and
(3) form an opinion or report on internal control over financial
reporting and compliance. Control risk should be assessed separately
for each significant financial statement assertion in each significant
cycle/accounting application (including RSSI).
The auditor of federal financial statements must evaluate and test
certain controls. AU 319 permits the auditor to assess control risk at
a high (maximum) level and forgo evaluation and testing of financial
reporting controls if the auditor believes evaluating their
effectiveness would be inefficient. However, because OMB audit guidance
requires the auditor to perform sufficient tests of internal controls
that have been properly designed and placed in operation to support a
low assessed level of control risk, the auditor in a federal financial
audit may not elect to forgo control tests solely because it is more
efficient to extend compliance and substantive audit procedures.
The following are the types of controls tested in a financial audit:
* financial reporting controls (including certain safeguarding and
budget controls) for each significant assertion in each significant
cycle/accounting application (identified in section 240),
* compliance controls for each significant provision of laws and
regulations (identified in section 245), including budget controls for
each relevant budget restriction (identified in section 250), and,
* operations controls for each operations control (1) relied on in
performing financial audit procedures or (2) selected for testing by
the audit team. (see section 275).
The auditor is not required to test controls that have not been
properly designed and implemented (placed in operation). Thus, internal
controls that are not effective in design do not need to be tested. If
the auditor determined in a prior year that controls in a particular
accounting application were ineffective and if management indicates
that controls have not improved, the auditor need not test them.
On the other hand, if controls have been determined to be effective in
design and implemented (placed in operation), the auditor of federal
financial statements must perform sufficient tests of their
effectiveness to support a low assessed level of control risk. In such
cases, the auditor may consider using a rotation approach to testing
controls over the various accounting applications, as described in FAM
Section 395 G (and in the FISCAM section 2.1.9.D �Multiyear Testing
Plans�). If the auditor expects to disclaim an opinion because of scope
limitations or inadequate controls, the auditor may limit internal
control work to updating the understanding of controls and whether they
have been placed in operation. The auditor may do this by inquiring as
to whether previously identified control weaknesses have been
corrected. In the year the auditor expects to issue an opinion on the
financial statements, the auditor needs a basis of sufficient work on
internal control.
In the internal control phase of a financial audit, the auditor should
perform and document the following procedures:
* Understand the entity's information systems for financial reporting,
compliance with laws and regulations, and relevant operations (see FAM
Section 320).
* Identify control objectives (see FAM Section 330).
* Identify and understand relevant control activities that effectively
achieve the control objectives (see FAM Section 340).
* Determine the nature, timing, and extent of control testing (see FAM
Section 350).
* Perform control tests that do not involve sampling (nonsampling
control tests - see section 360).1 (Sampling control tests, if
necessary, are performed in the testing phase, as discussed in FAM
Section 450.)
* On a preliminary basis, based on the evidence obtained, assess (1)
the effectiveness of financial reporting, compliance, and relevant
operations controls and (2) control and combined risk (see FAM Section
370). (Combined risk, which includes inherent and control risk, is
discussed in FAM paragraph 370.09).
As discussed in FAM Section 310.10, in gaining an understanding of an
entity�s internal control, including internal control related to IT and
other business processing performed outside the entity, the auditor
should obtain evidence about the design of relevant controls and
whether they have been placed in operation. In obtaining evidence about
whether controls have been placed in operation, the auditor should
determine whether the entity is using them, rather than merely having
them written in a manual, for example. This differs from determining a
control�s operating effectiveness, which is concerned with how the
control was applied, the consistency with which it was applied, and by
whom. Gaining an understanding of the design of internal control does
not require that the auditor obtain evidence about operating
effectiveness.
As discussed in FAM Section 310.11, the auditor should obtain an
understanding of internal control for IT and other business processing
performed outside the entity under a service agreement or other
contract arrangements for assessing risk and planning other audit
procedures. The auditor may obtain this understanding by performing
work directly at the service organization or by using SAS No. 70
reports that include these internal controls as discussed in AU 324.06-
.21.
For each potential weakness, consider the impact of compensating
controls or other factors that mitigate or reduce the risks related to
potential weaknesses.
The following sections summarize FAM audit steps related to the testing
of information system controls. The auditor should coordinate these
steps with the related FISCAM steps.
Understand Information Systems:
FAM Section 320 states that the auditor may use an IS controls
specialist to assist in understanding and documenting the IT aspects of
these systems. The auditor should document the understanding of these
systems in cycle memorandums, or other equivalent narratives, and
generally should prepare or obtain related flow charts. FAM 340 and 350
discuss identifying and documenting controls that are designed to
mitigate the risk of material misstatement.
Walk-throughs are important for understanding the transaction process
and for determining appropriate audit procedures. The auditor should
perform walk-throughs for all significant accounting applications. Walk-
throughs of budget, accounting, compliance, and operations systems
provide evidence about the functioning of such systems. The auditor
should document these walk-throughs. The auditor should incorporate the
IT aspects of each system into the audit documentation and may include
additional flow charts, narratives, and checklists.
FAM Section 320 continues that the auditor should obtain an
understanding of and should document the following for each significant
cycle and accounting application (including those dealing with RSSI):
* The manner in which transactions are initiated;
* The nature and type of records, journals, ledgers, and source
documents, and the accounts involved;
* The processing involved from the initiation of transactions to their
inclusion in the financial statements, including the nature of computer
files and the manner in which they are accessed, updated, and deleted;
and;
* The process used to prepare the entity's financial statements and
budget information, including significant accounting estimates,
disclosures, and computerized processing.
FAM Section 320.03 states that for each significant cycle and
accounting application identified for significant line items and
assertions in FAM 240 (including those dealing with RSSI) the auditor
should obtain an understanding of and should document, among other
things, processes used to prepare the entity�s financial statements and
budget information, including significant accounting estimates,
disclosures, and IT processing. These processes include:
* Procedures used to enter transaction totals into the general ledger;
* procedures used to initiate, authorize, record, and process journal
entries in the general ledger;
* procedures used to record recurring and nonrecurring adjustments to
the financial statements;
* procedures used to combine and consolidate general ledger data; and;
* closing process, including manual and automated procedures, for
preparing the financial statements and related disclosures.
The FISCAM section entitled �Understand Information Systems Relevant to
the Audit Objectives� included in section 2.2 provides more specific
guidance on how the auditor obtains an understanding of information
systems. This FISCAM section includes information that should be
included in audit documentation. As discussed in FAM Section 320, the
auditor must document the understanding gained of each component of
internal control, including the information system. The auditor should
prepare sufficient documentation to clearly describe the accounting
system. For each significant cycle, the auditor should prepare a cycle
memorandum or equivalent. Also, the auditor generally should prepare an
illustrative flowchart of the cycle and component accounting
application(s). Flowcharts provide a good mechanism to document the
process and the flow of transactions through the system.
However, the auditor should avoid extreme detail, which makes the
charts confusing and hard to follow. Complex systems, particularly
those involving IT, may be difficult to understand without a flowchart.
To the extent required as described above, the auditor should use the
following documents or equivalents to document.
Identify Relevant Control Objectives:
FAM Section 330 discusses the identification of control objectives. In
a financial audit, the auditor should identify control objectives for
each type of control that if achieved, would provide the entity with
reasonable assurance that individual and aggregate misstatements
(whether caused by error or fraud), losses, or noncompliance material
to the financial statements would be prevented or detected. For
Required Supplementary Stewardship Information (RSSI), the Statement of
Social Insurance, and nonmonetary information in the financial
statements, such as physical units of heritage assets, the objectives
would relate to controls that would provide reasonable assurance that
misstatements, losses, or noncompliance that would be considered
material by users of the information would be prevented or detected. As
noted above, control objectives in a financial audit involve:
* financial reporting controls, including safeguarding controls and
segregation-of-duties controls,
* compliance controls,
* budget controls, and,
* relevant operations controls.
As discussed in FAM Section 495A.21, if the reliability of internally-
generated data used in the substantive analytical procedures is
dependent on the effectiveness of IS controls, the auditor should
perform additional procedures before relying on the data. The auditor
should test, as appropriate, (1) the relevant general controls and the
specific business process application level controls over the data
and/or (2) the data in the report.
The FISCAM section "Identify IS Control Techniques That are Relevant to
the Audit Objectives" included in section 2.2 provides more specific
guidance on how the auditor identifies relevant IS control activities.
This FISCAM section includes information that should be included in
audit documentation. In addition to such documentation, as discussed in
FAM Sections 390 and 395H, the auditor documents relevant control
objectives in the SCE form or equivalent documentation. Based on such
controls and the audit planning procedures (particularly the
identification of critical control points), the auditor should identify
those other IS controls (general, business process application,
interface, and data management system controls) upon which the controls
in the SCE depend. FISCAM Appendices II and III can be used to document
such controls.
Identify Relevant Control Activities:
As discussed in FAM Section 340, the auditor identifies and understands
relevant control activities. For each control objective, based on
discussions with entity personnel and the results of other procedures
performed, the auditor should identify the control activities designed
to achieve the specific control objective. The auditor may indicate
these controls in the auditor�s informal notes and/or interview write-
ups for use in the following procedures, but the auditor need not
formally document them on the SCE worksheet at this time. The auditor
should first screen the activities to identify those that are effective
and efficient to test. An IS controls specialist may assist the auditor
in identifying and understanding IT controls. As discussed in FAM 350,
the auditor should use walk-throughs to confirm that the entity has
implemented these controls identified for further audit procedures.
These walk-throughs are in addition to those performed earlier to
understand the transaction processing. As discussed in FAM 270, in
determining whether control objectives are achieved, the auditor should
consider both manual and IS controls, if likely to be effective.
FAM Section 340.05 states that the auditor also should evaluate the
appropriateness of the specified criteria used to identify items in a
management or exception report. For example, IT input controls (such as
the matching of vendor invoices with receiving reports and purchase
orders) that require exact matches of data from different sources
before a transaction is accepted for processing may be more effective
than controls that accept transactions that fall within a broader range
of values. On the other hand, controls based on exception reports that
are limited to selected information or use more selective criteria may
be more effective than lengthy reports that contain excessive
information.
The FISCAM section �Identify IS Control Techniques That are Relevant to
the Audit Objectives� provides more specific guidance on how the
auditor identifies relevant IS controls.
The FISCAM is organized in a hierarchical structure to assist the
auditor in performing the IS controls audit. Chapter 3 (general
controls) and Chapter 4 (business process application level controls)
contain several control categories, which are groupings of related
controls pertaining to similar types of risk. For each control
category, the manual identifies critical elements�tasks that are
essential for establishing adequate controls within the category. For
each critical element, there is a discussion of the associated
objectives, risks, and control activities, as well as related potential
control techniques and suggested audit procedures. This hierarchical
structure facilitates the auditor�s audit planning and the auditor�s
analysis of identified control weaknesses.
Because control activities are generally necessary to achieve the
critical elements, they are generally relevant to a GAGAS audit unless
the related control category is not relevant, the audit scope is
limited, or the auditor determines that, due to significant IS control
weaknesses, it is not necessary to assess the effectiveness of all
relevant IS controls. Within each relevant control activity, the
auditor should identify control techniques implemented by the entity
and determine whether the control techniques, as designed, are
sufficient to achieve the control activity, considering IS audit risk
and the audit objectives. The auditor may be able to determine whether
control techniques are sufficient to achieve a particular control
activity without evaluating and testing all of the control techniques.
Also, depending on IS audit risk and the audit objectives, the nature
and extent of control techniques necessary to achieve a particular
control objective will vary.
If sufficient, the auditor should determine whether the control
techniques are implemented (placed in operation) and are operating
effectively. Also, the auditor should evaluate the nature and extent of
testing performed by the entity. Such information can assist in
identifying key controls and in assessing risk, but the auditor should
not rely on testing performed by the entity in lieu of appropriate
auditor testing. If the control techniques implemented by the entity,
as designed, are not sufficient to address the control activity, or the
control techniques are not effectively implemented as designed, the
auditor should determine the effect on IS controls and the audit
objectives.
This FISCAM section includes information that should be included in
audit documentation. In addition to this documentation, as discussed in
FAM Sections 390 and 395H, the auditor documents relevant controls in
the SCE form or equivalent documentation. Based on such controls and
the audit planning procedures (particularly the identification of
critical control points), the auditor should identify those other IS
controls (general, business process application, interface, and data
management system controls) upon which the controls in the SCE depend.
FISCAM Appendices II and III can be used to document such controls.
Determine the Nature, Timing, and Extent of Control Tests:
FAM Section 350 discusses determining the nature, extent, and timing of
control tests and compliance with FFMIA. FAM Section 350.01 states that
for each control objective, the auditor should:
* identify specific relevant control activities to test (FAM 350.06-
.08),
* perform walk-throughs to determine whether those controls have been
placed in operation (FAM 350.09),
* document these control activities in the SCE worksheet or equivalent
(FAM 350.10),
* determine the nature of control tests (FAM 350.11-.18),
* determine the extent of control tests (FAM 350.19-.20), and,
* determine the timing of control tests (FAM 350.21).
As discussed in FAM Section 350, for each control objective identified
in FAM 330, the auditor should identify the control activity, or
combination of control activities, that is likely to (1) achieve the
control objective and (2) improve the efficiency of control tests. In
doing this, the auditor should consider (1) the extent of any inherent
risk and control environment, risk assessment, communication, or
monitoring weaknesses, including those related to IS controls (as
documented in the ARA and/or audit strategy document, or equivalent
(see FAM 260)), and (2) the tentative determination of the likelihood
that IS controls will be effective, as determined in the planning phase
(see FAM 270). The auditor generally should test only the control
activities necessary to achieve the objective.
If, in any phase of the audit, the auditor determines that control
activities selected for testing are, in fact, ineffective in design or
operation, the auditor should discontinue the specific control
evaluation of the related control objectives and should report the
identified weaknesses in internal control as discussed in FAM 580. This
would include situations where the control activities are not effective
in design or operation due to ineffective IS controls. If the entity�s
management does not agree with the auditor�s conclusion that effective
control activities do not exist or are unlikely to exist, the auditor
may need to perform procedures sufficient to support that conclusion.
As discussed in FAM Section 350.10, the auditor should document the
control activities to be tested on the SCE worksheet or equivalent (see
an illustration in FAM 395 H). The auditor generally should test other
components of internal control by observation and inquiry in the
planning phase (see FAM 260.09). The auditor may list (and evaluate)
controls that satisfy more than one control objective only once and
refer to these controls, when applicable, on subsequent occasions. For
each control to be tested, the auditor should determine whether the
control is an IS control. An IS controls specialist generally should
review and concur with the auditor�s identification of IS controls.
For every IS control identified above and included in the SCE form or
equivalent document, based upon IS controls audit planning, the IS
controls specialist should identify the general controls (entitywide,
and system levels) and business process application level controls upon
which the IS controls depend. Such systems and business process
application level controls would principally relate to the critical
control points. For example, if the IS control is the review of an
exception report, the auditor should identify and test the business
process application controls directly related to the production of the
exception report, as well as the general and other business process
application controls upon which the reliability of the information in
the exception report depends, including the proper functioning of the
business process application that generated the exception report and
the reliability of the data used to generate the exception report. In
addition, the auditor should test the effectiveness of the user control
(i.e., management review and followup on the items in the exception
report).
Test Information System Controls:
FAM Section 360 discusses tests of application controls and user
controls. As discussed in FAM Section 360.10, the auditor, with IS
controls specialist assistance, generally should perform tests of those
application controls and user controls necessary to achieve the control
objectives where the entitywide, system, and application-level general
controls were determined to be effective.
FAM 360.01 states that the auditor should design and conduct tests of
control activities that are effective in design to determine their
effectiveness in operation. (See FAM 380.02 if control activities are
not effective in design during the entire audit period.) The auditor
generally should:
* request IS controls specialist assistance and test IS controls (FAM
360.03-.10),
* perform nonsampling control tests (the auditor generally should
perform sampling control tests in the testing phase, as discussed in
FAM 450), (FAM 360.11-.13), and;
* evaluate the results of nonsampling control tests (FAM 360.14-.15).
If the auditor identifies IS controls for testing, the auditor, with IS
controls specialist assistance, should evaluate the effectiveness of
relevant:
* general controls at the entitywide and system level;
* general controls at the business process application level; and;
* specific business process controls, interface controls, data
management system controls and/or user controls, unless the IS controls
that achieve the control objectives are general controls.
If controls are not effective, see FAM 360.07 and FAM 360.09. It is
generally more efficient for the auditor to test IS controls on a
tiered basis, starting with the general controls at the entitywide and
system levels, followed by the general controls at the business process
application level, and concluding with tests of business process
application, interface, and data management system controls at the
business process application level. Such a testing strategy may be used
because ineffective IS controls at each tier generally preclude
effective controls at the subsequent tier.
The auditor, with IS controls specialist assistance, should determine
whether relevant entitywide and system level general controls are
effectively designed, implemented, and operating effectively by:
* identifying applicable general controls;
* determining how those controls function, and whether they have been
placed in operation; and;
* evaluating and testing the effectiveness of the identified controls.
The auditor and the IS controls specialist generally should use
knowledge obtained in the planning phase.
The auditor, with assistance from the IS controls specialist, should
document the understanding of general controls and should conclude
whether such controls are effectively designed, placed in operation,
and, for those controls tested, operating as intended.
Tests of General Controls at the Entitywide and System Levels:
The auditor may test general controls through a combination of
procedures, including observation, inquiry, inspection (which includes
a review of documentation on systems and procedures), and reperformance
using appropriate test software. Although sampling is generally not
used to test general controls, the auditor may use sampling to test
certain controls, such as those involving approvals.
If general controls are not effectively designed and operating as
intended, the auditor will generally be unable to obtain satisfaction
that application controls are effective. In such instances, the auditor
should (1) determine and document the nature and extent of risks
resulting from ineffective general controls and (2) identify and test
any manual controls that achieve the control objectives that the IS
controls in the SCE or equivalent document were to achieve.
However, if manual controls do not achieve the control objectives, the
auditor, with IS controls specialist assistance, should determine
whether any specific IS controls are designed to achieve the
objectives. If not, the auditor should develop appropriate findings
principally to provide recommendations to improve internal control. If
specific IS controls are designed to achieve the objectives, but are in
fact ineffective because of poor general controls, testing would
typically not be necessary, except to support findings.
Tests of General Controls at the Business Process Application Level:
If the auditor reaches a favorable conclusion on general controls at
the entitywide and system levels, the IS controls specialist should
evaluate and test the effectiveness of general controls for those
business process applications within which business process application
controls or user controls are to be tested.
If general controls are not operating effectively within the
application, application controls and user controls generally will be
ineffective. In such instances, the IS controls specialist should
discuss the nature and extent of risks resulting from ineffective
general controls with the audit team. The auditor should determine
whether to proceed with the evaluation of application controls and user
controls.
Tests of Business Process Application Controls and User Controls:
The auditor, with IS controls specialist assistance, generally should
perform tests of those business process application controls (business
process controls, interface controls, and data management system
controls), and user controls necessary to achieve the control
objectives where the entitywide, system, and application-level general
controls were determined to be effective.
As discussed in FAM Section 360.13, the auditor should test segregation
of duties in the situations described in FAM 330.08. The auditor may
use the following procedures to test segregation-of-duties controls:
a. Identify the assets to be controlled through the segregation of
duties.
b. Identify the individuals who have authorized access (direct or
indirect) to the assets. Direct access exists when the individual is
authorized to handle the assets directly (such as during the processing
of cash receipts). Indirect access exists when the individual is
authorized to prepare documents that cause the release or transfer of
assets (such as preparing the necessary forms to request a cash
disbursement or transfer of inventory).
c. For each individual with authorized access to assets, determine
whether there are sufficient asset access controls. Asset access
controls are those controls that are designed to provide assurance that
actions taken by individuals with authorized access to assets are
reviewed and approved by other individuals. For example, an approval of
an invoice for payment generally provides asset access controls
(relating to cash) over those individuals authorized to prepare
supporting documentation for the transaction. If IS controls provide
access to assets, the auditor should design tests of IS controls to
identify (1) individuals (including IT personnel) who may use the
computer to obtain access and (2) asset access controls over such
individuals.
d. For individuals with authorized access to assets over which asset
access controls are insufficient, determine whether such individuals
can affect any recording of transactions in the accounting records. If
so, segregation of duties is insufficient, unless such access to
accounting records is controlled. For example, the person who processes
cash receipts may also be able to record entries in the accounting
records.
Such a person may be in a position to manipulate the accounting records
to conceal a shortage in the cash account, unless another individual
reviews all accounting entries made (and those that should have been
made) by that person. In an IT accounting system, access to assets
frequently provides access to records. For example, generation of a
check may automatically record a related accounting entry. In such
circumstances, a lack of asset access controls would result in
inadequate segregation of duties, and the auditor should determine
whether other controls would mitigate the effects of this lack of asset
access control.
The FISCAM section �Test Information System Controls� included in
section 2.2 provides more specific guidance on how the auditor tests
relevant IS control techniques. This FISCAM section includes
information that should be included in audit documentation. In
addition, FISCAM Chapters 3 and 4 provide general controls and business
process application level controls consistent with GAGAS categories. In
addition, Appendices II and III may be used to document the results of
the IS controls audit tests.
As discussed in FAM Section 390, the auditor should document the
evaluation of specific control activities in the SCE worksheet or
equivalent. The auditor should document control tests in the control
test audit plan (formerly referred to as the audit program) and in
accompanying documents. The auditor should also document any IT system
control tests as discussed in FAM 370.05. FAM 395 H presents an example
of a completed SCE worksheet documents. FISCAM Appendices II and III
can be used to document such controls.
Reporting The Results Of The Is Controls Audit:
FAM Sections 370 and 580 discuss the auditor�s assessment of the
effectiveness of IS controls based on internal control tests performed.
As discussed in FAM Section 370.03, based on the procedures performed,
the auditor and IS controls specialist should discuss conclusions on
the effectiveness of IS controls and reach agreement. The auditor
should (1) incorporate the conclusions into the audit documentation for
each IS control tested and (2) perform tests of application controls
(principally manual follow-up of exceptions) or user controls
identified by the IS controls specialist for the audit team to test.
If the auditor and the IS controls specialist determine that IS
controls are effective, the auditor may also ask the IS controls
specialist to identify any IS controls within the applications tested
that were not previously identified by the auditor using the above
procedures. For example, such IS controls might achieve control
objectives not otherwise achieved through manual controls or might be
more efficient or effective to test than manual controls. The IS
controls specialist may assist the auditor in determining the
efficiency and effectiveness of searching for and testing additional IS
controls. The auditor should document these decisions, including a
description of the expected scope of the IS controls specialist�s work.
The auditor and the IS controls specialist should work together to
document the procedures for evaluating and testing the effectiveness of
IS controls and the results of this work.
The FISCAM section 2.3 �Report Audit Results� provides more specific
guidance on how the auditor evaluates the results of tests of IS
controls within the context of a financial audit. More specifically,
the section discusses the auditor�s considerations for determining
whether IS control weaknesses are material weaknesses, significant
deficiencies, and significant deficiencies for purposes of FFMIA
reporting.
Steps in Assessing Information System Controls:
As discussed in FAM 270, the following flowcharts illustrate steps the
auditor and the IS controls specialist generally follow in assessing IS
controls in a financial statement audit. However, the audit team may
decide to test the effectiveness of the general controls even if they
are not likely to be effective (see fig. 6) or review business process
application controls even though general controls are not effective
(see fig. 7), in order to make recommendations on how to fix weak
controls.
Figure 6: Steps in Assessing IT Systems Controls in a Financial
Statement Audit:
[See PDF for image]
This figure is a chart of the steps in assessing it systems controls in
a financial statement audit, as follows:
1) Identify significant applications and key processing locations [A];
2) Obtain background information; Appendix I in FISCAM, "Information
System Controls Audit Planning Checklist" may be used; [B];
3) Obtain overview of each significant application and design of
related business process application controls [A]; (Consider: Business
process controls [input, processing, output, and master data];
Interface controls; Data management system controls);[B];
4) Perform preliminary assessment of design of relevant IS controls
(based primarily on inquiry with limited observation and walk-through
procedures) (Appendices II and III in FISCAM may be used to document
design of general controls); [B];
- Consider: Security management; Logical and physical access controls;
Configuration management; Segregation of duties; Contingency Planning;
[B];
- Develop approach that assesses control risk as high (maximum for all
IS related controls); approach cannot rely on any related IS controls;
[A];
- Indicate on SCE Form that all IS controls are ineffective;[A];
- Perform revised substantive tests; [A];
- Develop findings; [A];
- Report results; [A];
- Stop.
5) Are controls likely to be effective?
If yes:
6) Perform detail tests of relevant General Controls (entitywide,
system, and business process application levels); Appendices II and III
in FISCAM may be used to document tests of general controls; Use
practice ais for technical areas; [B];
If no:
- Develop approach that assesses control risk as high (maximum for all
IS related controls); approach cannot rely on any related IS controls;
[A];
- Indicate on SCE Form that all IS controls are ineffective;[A];
- Perform revised substantive tests; [A];
- Develop findings; [A];
- Report results; [A];
- Stop.
7) Are general controls effective:
If yes:
Audit;
If no:
- Develop approach that assesses control risk as high (maximum for all
IS related controls); approach cannot rely on any related IS controls;
[A];
- Indicate on SCE Form that all IS controls are ineffective;[A];
- Perform revised substantive tests; [A];
- Develop findings; [A];
- Report results; [A];
- Stop.
[A] Usually done by auditor in consultation with IS controls
specialist.
[B] Usually done by IS controls specialist in consultation with
auditor.
Source: GAO.
[End of figure]
Figure 7: Steps for Each Significant Application in Assessing
Information System Controls in a Financial Statement Audit:
[See PDF for image]
This figure is a chart of the Steps for each significant application in
assessing information system controls in a financial statement audit,
as follows:
Audit:
1) Identify on SCE form the IS controls that are the basis of control
risk assessment[A];
2) Perform detail tests of those IS controls and related business
process application controls on which their effectiveness depends[B];
Appendices II and III in FISCAM may be used to document tests of
business process application controls[B]; Consider: Business process
controls (input, processing, output, master data), Interface controls,
Data management system controls[B];
3) Are these IS controls operating effectively?
If yes:
4) Do not change control risk assessment[A];
5) Perform planned substantive testing[A];
- Develop findings[A];
- Report results[A];
- Stop.
If no:
- Change control risk assessment and related substantive testing[A];
- Perform revised substantive tests[A];
- Develop findings[A];
- Report results[A];
- Stop.
[A] Usually done by auditor in consultation with IS controls
specialist.
[B] Usually done by IS controls specialist in consultation with
auditor.
Source: GAO.
[End of figure]
[End of appendix]
Appendix VII - Entity�s Use of Service Organizations:
Many entities use outside service organizations to support business
processes. Service organizations provide services ranging from
performing a specific task (e.g., payroll processing) to replacing
entire business units or functions of an entity. To determine the
significance of the functions performed by service organizations to the
audit objectives, auditors should obtain information about (1) services
performed by the service organizations, (2) the related service
organization controls, and (3) their effects on the audit objectives.
If an organization uses a service organization, information and
information processing are subjected to controls that may be physically
and operationally removed from the user organization. Consequently, an
entity�s internal control may include controls that are not directly
administered by the user organization, but rather by the service
organization. For this reason, to obtain an understanding of IS
controls, the auditor of the user organization (the user auditor)
should gain an understanding of controls at the service organization
that may affect the user organization�s business processes. This
understanding may be gained in several ways, including discussions with
management and/or obtaining a service auditor�s report. In addition,
FISMA requirements specifically apply to information systems used or
operated by an agency or by a contractor of an agency or other
organization on behalf of the entity.
During the planning stage of the audit, the user auditor should
determine the significance of the service organization�s controls to
the user organization�s internal control and to the audit objectives.
Factors that may affect the significance to the audit of a service
organization�s controls include the following:
* The nature and materiality/significance of the transactions or
information affected by the service organization
* The degree of interaction between internal control at the user
organization and the service organization�s controls. The degree of
interaction refers to the extent to which a user organization is able
to and elects to implement effective controls over the processing
performed by the service organization.
With respect to financial audits, a service organization�s services are
part of an entity�s information system, and therefore significant to
the user organization�s internal control, if they affect any of the
following:
* The classes of transactions in the entity�s operations that are
significant to the financial statements;
* The procedures, both automated and manual, by which the entity�s
transactions are initiated, recorded, processed, and reported, from
their occurrence to their inclusion in the financial statements;
* The related accounting records (whether electronic or manual),
supporting information, and specific accounts in the financial
statements involved in initiating, recording, processing, and reporting
the entity�s transactions;
* How the entity�s information system captures other events and
conditions that are significant to the financial statements;
* The financial reporting process used to prepare the entity�s
financial statements, including significant accounting estimates and
disclosures.
If the user auditor determines that the service organization�s controls
are significant to the user organization�s internal control, and within
the context of the audit objectives, the user auditor should gain a
sufficient understanding of those controls to assess risk and plan the
audit. Such controls include (1) user controls and (2) other controls
implemented by the user entity to monitor the effectiveness of the
design and operation of controls related to the information processed
by the service organization. Such monitoring controls could include:
* contractual security requirements,
* service level agreements,
* receipt and analysis of service organization reports,
* additional testing requested of the service auditor or performed by
the user entity, and;
* other user entity controls.
If the service organization�s controls are significant to the user
organization�s internal control and within the context of the audit
objectives, inadequate monitoring controls prevent entity management
from having reasonable assurance that controls over the information
processed and/or maintained by the service organization are designed
and operating effectively.
Sources of information include analysis of user controls implemented by
the user entity and interviews of appropriate entity personnel. Also,
the auditor may review any service auditor reports. The service
organization may hire an independent auditor (referred to as the
service auditor) to provide a report (referred to as the SAS 70 report)
on the internal controls at the service provider. Each user
organization and its auditor may use this report to assess the internal
control policies and procedures at the service organization as part of
the overall evaluation of the internal control at the user
organization. If additional information about service bureau controls
is still needed, the auditor may contact the service organization,
through the user entity, for additional information.
The user auditor should obtain a sufficient understanding of internal
control to evaluate the effectiveness of the design of controls
relevant to the audit objectives and determine whether they have been
implemented. In some instances, the user entity may have effective
controls over the service organization. In such cases, evidence about
the operating effectiveness of internal control can be obtained from
the user entity. However, in other cases, the controls are applied only
at the service organization.
For internal control that is significant within the context of the
audit objectives, auditors should assess whether internal control has
been properly designed and implemented. Based on the user auditor�s
understanding of the design effectiveness and implementation of
internal control, the auditor should assess risks relevant to the audit
objectives. In a financial statement audit, the auditor should identify
and assess the risk of material misstatement at the financial statement
level and at the relevant assertion level related to classes of
transactions, account balances, and disclosures.
In a performance audit, for those internal controls that are deemed
significant within the context of the audit objectives, auditors should
plan to obtain sufficient, appropriate evidence to support their
assessment about the operating effectiveness of those controls,
including tests of such controls. In a financial audit, the auditor
should perform tests of the operating effectiveness of controls when
the auditor�s risk assessment includes an expectation of the operating
effectiveness of controls or when substantive procedures alone do not
provide sufficient appropriate audit evidence at the relevant assertion
level. For federal financial audits, OMB requires auditors of federal
financial statements to test those controls that are effectively
designed.
To obtain sufficient, appropriate evidence about the operating
effectiveness of service organization controls, the auditor may
determine that it is appropriate to use a service auditor�s report. In
such instances, the auditor should determine whether the service
auditor�s report is sufficient to meet the audit objectives. For
financial audits, the auditor�s considerations are discussed at AU 543
(Part of Audit Performed by Other Independent Auditors). In some
instances, the user auditor may determine that it is necessary and
appropriate to supplement the service auditor report by discussing it
with the service auditor, by requesting the service auditor to perform
agreed-upon procedures, or by performing procedures at the service
organization. In addition, in some instances, the user auditor may
request the service auditor to perform tests of data maintained by the
service organizations. Any such requests of the service auditor should
be coordinated through the user and service organizations.
A service auditor may provide a service organization with one of two
types of SAS 70 reports:
* Type 1 is a report on the design and implementation of controls
(placed in operation) at a service organization, but does not include
testing of the operating effectiveness of controls. This information,
in conjunction with other information about a user organization�s
internal control, may assist the user auditor in obtaining an
understanding of the user organization�s internal control. A type 1
report is not intended to provide a basis for the auditor to reduce the
assessment of risk, because it does not include control testing to
determine whether the controls are operating effectively.
* Type 2 is a report on the design and implementation of controls
(placed in operation) and on their operating effectiveness. In a type 2
engagement, the service auditor performs the procedures required for a
type 1 engagement and also performs tests of specific controls to
evaluate their operating effectiveness in achieving the specified
control objectives. The service auditor issues a report that includes
the type 1 report opinions and refers the reader to a description of
tests of operative effectiveness performed by a service auditor. The
report states whether, in the opinion of the service auditor, the
controls tested were operating with sufficient effectiveness to provide
reasonable, but not absolute, assurance that the related control
objectives were achieved during the period specified. If a service
organization�s controls that affect a user organization�s financial
statements are operating with sufficient effectiveness to achieve the
related control objectives, a user auditor may be able to use the type
2 report as evidence of control effectiveness, reduce their assessment
of risk for certain financial statement assertions affected by the
service organization�s service, and reduce the extent of substantive
procedures performed for those assertions.
The nature, timing, and extent of the tests of operating effectiveness
are also affected by the period covered by the report. Tests of
operating effectiveness may provide evidence that will enable the
service auditor to report on the entire period covered by the report.
To be useful to user auditors, the report ordinarily should cover the
reporting period of the user organization. If it does not cover the
entire reporting period, the user auditor should evaluate the related
effect on the user auditor�s risk assessment and, for the period not
covered by the service auditor report(s), should evaluate the adequacy
of evidence about the operating effective of controls.
The service organization is responsible for identifying the internal
controls that may be relevant to a user organization�s internal control
(description of controls). The service auditor is responsible for
determining whether the description provides sufficient information for
user auditors to obtain an understanding of those aspects of the
service organization�s controls that would have an effect on the user
organization�s internal control. Also, the service auditor may identify
certain controls that the service organization assumes would be
implemented by the user organization.
In OMB Circular A-123, Appendix A, OMB stated that an agency can
leverage SAS 70 reports during the assessment. Management must
determine if a Type II SAS 70 report exists and consider whether it is
sufficient in scope. Agency management should look at the scope of the
SAS 70 report in the context of the overall internal control assessment
when considering the nature and type of other assessment activities
needed outside of the SAS 70 process. A Type II SAS 70 report is
required to be prepared by all federal entities that cross-service
other federal entities per OMB Memorandum M-04-11, Service Organization
Audits. In addition, the �Implementation Guide for OMB Circular A-123,
Management�s Responsibility for Internal Control Appendix A, Internal
Control over Financial Reporting,� issued by the Chief Financial
Officer�s Council (July 2005) provides guidance for considering service
organization controls as part of the annual A-123 assessment.
FISMA applies to both (1) information collected or maintained by or on
behalf of an agency and (2) information systems used or operated by an
agency or by a contractor of an agency or other organization on behalf
of an agency. As discussed in OMB Memoranda, as part of FISMA, agency
management is responsible for ensuring that contractors (and others
covered by FISMA) meet FISMA requirements, including annual testing.
SAS 70 reports may provide sufficient evidence of contractor
compliance. However, it may not address all of the FISMA control
objectives and it may not ensure the specific systems that support the
government or contract activity are actually reviewed.
Therefore, in determining whether SAS 70 reports provide sufficient
evidence of contractor system FISMA compliance, it is the agency�s
responsibility to ensure:
* The scope of the SAS 70 audit was sufficient, and fully addressed the
specific contractor system requiring FISMA review.
* The audit encompassed all controls and requirements of law, OMB
policy and NIST guidance.
In addition, NIST SP 800-47 discusses additional steps agency
management should implement with respect to contractors, such as an
Interconnection Security Agreement (ISA) and a Memorandum of
Understanding (MOU). The ISA specifies the technical and security
requirements of the interconnection, and the MOU defines the
responsibilities of the participating organizations.
SAS 70 reports do not include contingency planning controls, as
auditing standards (AU 324) do not apply to internal control
deficiencies that affect processing in future periods. However, service
auditors can be requested to perform procedures to test the
effectiveness of contingency planning controls and report the results
of such testing to service organization management, who may in turn
disclose the information and plans to correct deficiencies in the
section of the SAS 70 report titled �Other Information Provided by the
Service Organization.�
The FISCAM can be used as a basis for performing a SAS 70 audit, using
the control objectives discussed in Chapter 1.
[End of appendix]
Appendix VIII - Application of FISCAM to Single Audits[Footnote 99]:
The FISCAM can be used to assess information system controls over
compliance requirements and financial reporting in connection with a
single audit. The following provides a brief introduction to single
audit requirements and how the FISCAM relates to such requirements. See
the Single Audit Act, as amended, OMB Circular A-133, the Compliance
Supplement, and the AICPA Audit Guide: Government Auditing Standards
and Circular A-133 Audits for additional information.
Single audits include opinions on the entity�s financial statements,
the schedule of expenditures of federal awards, and the entity�s
compliance with laws, regulations, and the provisions of contracts or
grant agreements pertaining to federal awards that may have a direct
and material effect on each of its major programs (referred to as
compliance requirements). Government Auditing Standards (�yellow book�)
require certain audit procedures relating to internal controls over
financial reporting in relation to the audit of the financial
statements and the schedule of expenditures. In addition, auditors
performing a single audit should obtain evidence about the
effectiveness of internal control over the compliance requirements of
major Federal programs.
In assessing internal control over compliance requirements and
financial reporting, the auditor should evaluate whether the each of
the specific control techniques that are significant to compliance and
financial reporting is an information systems (IS) control. An IS
controls specialist generally should review and concur with the audit
team�s identification of IS controls, particularly with respect to
whether all IS controls were properly identified as such.
As discussed in Chapter 1, IS controls consist of those internal
controls that are dependent on information systems processing and
include general controls (entitywide, system, and business process
application levels), business process application controls (input,
processing, output, master file, interface, and data management system
controls), and user controls [Footnote 100] (controls performed by
people interacting with information systems). General and business
process application controls are always IS controls. A user control is
an IS control if its effectiveness depends on information systems
processing or the reliability (accuracy, completeness, and validity) of
information processed by information systems. Conversely, a user
control is not an IS control if its effectiveness does not depend on
information systems processing or the reliability of information
processed by information systems.
The FISCAM can be used to determine whether IS controls are (1)
appropriately designed and implemented (placed in operation), and (2)
operating effectively.
As discussed in Chapter 2, the auditor should identify and document the
other entitywide, system, and business process level IS controls upon
which the effectiveness of each significant IS control technique
depends. These other IS controls will principally relate to the
entitywide level controls and to each of the critical control points
(including control dependencies) at the system and business process
application levels. For example, if the IS control is the review of an
exception report, the auditor should identify and test the business
process application controls directly related to the production of the
exception report, as well as the general and other business process
application controls upon which the reliability of the information in
the exception report depends, including the proper functioning of the
business process application that generated the exception report and
the reliability of the data used to generate the exception report. In
addition, the auditor should test the effectiveness of the user control
(i.e., management review and followup on the items in the exception
report).
The following sections address the audit procedures that should be
applied in a single audit with respect to controls over (1) compliance
requirements and (2) financial reporting.
Internal Control over Compliance Requirements:
To evaluate internal control over compliance requirements for major
programs, the auditor should:
* plan the audit and testing of internal control to support a low
assessed level of control risk for the assertions relevant to the
compliance requirements for each major program, and;
* unless internal controls are ineffective in design, perform testing
of the operating effectiveness of internal controls as planned to
support a low assessed level of control risk for the assertions
relevant to the compliance requirements for each major program.
When internal control over compliance requirements for a major program
is ineffective in preventing or detecting noncompliance (either in
design or operation), the auditor should report a significant
deficiency (including whether any such condition is a material
weakness), assess the related control risk at the maximum, and
determine whether to apply further audit procedures to test compliance
based on ineffective internal control.
In planning and performing a single audit, the auditor should:
* Identify the major programs subject to the single audit.
* Identify systems that process data for major programs.
* Determine the types of compliance requirements that are relevant to
the audit (see A-133 and the Compliance Supplement).
* For each relevant type of compliance requirement, determine/identify
the relevant control objectives (see the Compliance Supplement).
* For each relevant control objective, identify the internal control
technique(s) designed/implemented by the entity to achieve the
objective.
* Determine whether such control techniques are effectively designed to
achieve the related control objective(s) and if so, whether they are
placed in operation (implemented), including related IS controls upon
which the effectiveness of the control technique depends. The auditor
can use the FISCAM to assess the effectiveness of the design of IS
control techniques and whether they have been implemented (placed in
operation).
* For each control that is effectively designed and implemented (placed
in operation), the auditor should determine whether it is effectively
operating. The auditor can use the FISCAM to determine whether IS
controls are effectively operating. As discussed in Chapter 2, for each
IS control technique, the auditor should test the effectiveness of:
- the specific IS control technique, and;
- the business process application and general controls upon which the
effectiveness of specific IS control depends.
When the auditor assesses control risk below the maximum level, the
auditor should obtain sufficient evidential matter to support that
assessed level of control risk. The type of evidential matter, its
source, its timeliness, and the existence of other evidential matter
related to the conclusions to which it leads all bear on the degree of
assurance the evidential matter provides.
Based on the tests of controls, the auditor should draw conclusions on
the assessed level of control risk. The auditor should also consider
the impact on the assessment of internal controls of any exceptions
noted as part of the audit procedures applied to test conformance with
compliance requirements. The assessment of the effectiveness of
internal control over compliance in preventing or detecting
noncompliance is determined in relation to each individual type of
compliance requirement for each major program or to an audit objective
identified in the Compliance Supplement (e.g., controls over
requirements for eligibility).
The auditor should determine whether any deficiencies in IS controls
represent material weaknesses or significant deficiencies. The
following definitions are provided in the draft reports on A-133
provided by the AICPA[Footnote 101]:
* A control deficiency in an entity�s internal control over compliance
exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their
assigned functions, to prevent or detect noncompliance with a type of
compliance requirement of a federal program on a timely basis.
* A significant deficiency is a control deficiency, or combination of
control deficiencies, that adversely affects the entity�s ability to
administer a federal program such that there is more than a remote
likelihood that noncompliance with a type of compliance requirement of
a federal program that is more than inconsequential will not be
prevented or detected by the entity�s internal control.
* A material weakness is a significant deficiency, or combination of
significant deficiencies, that results in more than a remote likelihood
that material noncompliance with a type of compliance requirement of a
federal program will not be prevented or detected by the entity�s
internal control.
The objectives of internal control pertaining to the compliance
requirements for Federal programs are as follows:
(1) Transactions are properly recorded and accounted for to:
(i) Permit the preparation of reliable financial statements and Federal
reports;
(ii) Maintain accountability over assets; and;
(iii) Demonstrate compliance with laws, regulations, and other
compliance requirements;
(2) Transactions are executed in compliance with:
(i) Laws, regulations, and the provisions of contracts or grant
agreements that could have a direct and material effect on a Federal
program; and;
(ii) Any other laws and regulations that are identified in the
compliance supplements; and;
(3) Funds, property, and other assets are safeguarded against loss from
unauthorized use or disposition.
Part 6 of the Compliance Supplement is designed to assist non-Federal
entities and their auditors in complying with these requirements by
describing, for each type of compliance requirement, the objectives of
internal control, and certain characteristics of internal control that,
when present and operating effectively, may ensure compliance with
program requirements. Part 6 cautions that the categorizations used in
the Supplement may not necessarily reflect how an entity considers and
implements internal control. Also, Part 6 was not designed as a
checklist of required internal control characteristics. Non-Federal
entities could have adequate internal control even though some or all
of the characteristics included in Part 6 are not present. Further, non-
Federal entities could have other appropriate internal controls
operating effectively that have not been included in Part 6. Non-
Federal entities and their auditors should exercise judgment in
determining the most appropriate and cost effective internal control in
a given environment or circumstance to provide reasonable assurance for
compliance with Federal program requirements.
The characteristics of internal control in Part 6 of the Compliance
Supplement are presented in the context of the components of internal
control discussed in Internal Control-Integrated Framework (COSO
Report), published by the Committee of Sponsoring Organizations of the
Treadway Commission. These components are consistent with the Standards
for Internal Control in the Federal Government (Green Book). [Footnote
102] Part 6 describes characteristics of internal control relating to
each of the five components of internal control that should reasonably
assure compliance with the requirements of Federal laws, regulations,
and program compliance requirements.
Internal Control over Financial Reporting:
In addition, the auditor should gather evidence about internal controls
over financial reporting, including information system controls, as
part of the financial audits of the financial statements and schedule
of expenditures of federal awards. The auditor may use evidence
gathered in connection with the testing of controls over compliance
discussed above.
GAGAS financial audit standards require the auditor to obtain an
understanding of internal control over financial reporting sufficient
to assess the risk of material misstatement of the financial statements
whether due to error or fraud, and to design the nature, timing, and
extent of further audit procedures. This includes performing risk
assessment procedures to evaluate the design of controls relevant to an
audit of financial statements and to determine whether they have been
implemented. In obtaining this understanding, the auditor considers how
an entity�s use of information technology (IT) and manual procedures
affect controls relevant to the audit. The FISCAM can be used to assist
the auditor in obtaining an understanding of internal controls relevant
to the financial statements and schedule of expenditures of federal
awards.
In addition, when the auditor has determined that it is not possible or
practicable to reduce the detection risk at the relevant assertion
level to an acceptably low level with audit evidence obtained only from
substantive procedures, the auditor should perform tests of controls to
obtain audit evidence about their operating effectiveness. For example,
the auditor may find it impossible to design effective substantive
procedures that by themselves provide sufficient appropriate audit
evidence at the relevant assertion level when an entity conducts its
business using information technology (IT) and no documentation of
transactions is produced or maintained, other than through the IT
system.
Specifically, as discussed in Chapter 2, for those internal controls
over financial reporting that the auditor (1) has determined are
suitably designed and implemented (2) plans to test whether they are
operating effectively, and (3) has determined to be IS controls (as
defined above), the auditor should test the effectiveness of:
* the specific IS control, and;
* the business process application and general controls upon which the
effectiveness of specific IS control depends.
The FISCAM can be used to assess the effectiveness of the design and
operation of information system controls as part of the financial
audits of the financial statements and schedule of expenditures of
federal awards.
[End of appendix]
Appendix IX - Application of FISCAM to FISMA:
The FISCAM may be used as a basis for the independent evaluation of a
federal agency�s information security program required by the Federal
Information Security Management Act (FISMA). A FISMA evaluation does
not require an audit or the use of the FISCAM. Also, this guidance may
be used to perform FISMA evaluations that are not based on GAGAS
audits. For FISMA evaluations not performed as GAGAS audits, auditor
judgment can be used to determine the appropriate level of
documentation. This section provides guidance on how the FISCAM can be
used as the basis for a FISMA evaluation.
Background:
FISMA requires that each year each agency shall have performed an
independent evaluation of the information security program and
practices of that agency to determine the effectiveness of such program
and practices (see Appendix X � FISMA legislation). Each evaluation
shall include:
* testing of the effectiveness of information security policies,
procedures, and practices of a representative subset of the agency�s
information systems;
* an assessment (made on the basis of the results of the testing) of
compliance with the requirements of FISMA; and related information
security policies, procedures, standards, and guidelines; and;
* separate presentations, as appropriate, regarding information
security relating to national security systems.
The independent annual evaluation for non-national security systems is
to be performed (1) for each agency with an Inspector General appointed
under the Inspector General Act of 1978, by the Inspector General or an
independent external auditor, as determined by the Inspector General of
the agency; or (2) for those agencies without an inspector general, by
an independent external auditor engaged by the head of the agency. For
each agency operating or exercising control of a national security
system, that portion of the evaluation required by this section
directly relating to a national security system shall be performed (1)
only by an entity designated by the agency head; and (2) in such a
manner as to ensure appropriate protection for information associated
with any information security vulnerability in such system commensurate
with the risk and in accordance with all applicable laws.
The annual independent evaluation section may be based in whole or in
part on an audit, evaluation, or report relating to programs or
practices of the applicable agency. Each year, the head of each agency
shall submit to the Director of OMB the results of the evaluation. To
the extent an evaluation directly relates to a national security
system, the evaluation results submitted to the Director of OMB shall
contain only a summary and assessment of that portion of the evaluation
directly relating to a national security system. Agencies and auditors
shall take appropriate steps to ensure the protection of information
which, if disclosed, may adversely affect information security. Such
protections shall be commensurate with risk and comply with all
applicable laws and regulations.
Scope of Evaluation Procedures:
As noted above, the independent evaluation shall include testing the
effectiveness of information security policies, procedures, and
practices for a representative subset of agency information systems.
The concept of a representative subset was intended to provide the
auditor (the party performing the independent evaluation) with a
reasonable basis for their evaluation. The auditor should select the
subset of systems for testing with the expectation that it would be
representative of all of the entity�s systems covered by FISMA, in all
significant respects. Using professional judgment, the auditor should
identify a sufficient scope of systems testing to constitute a
representative subset of the entity�s systems. The auditor may
supplement systems tested for other purposes (e.g., financial audits)
with additional systems necessary to obtain a representative subset.
The auditor also may select a representative subset of systems for
FISMA and supplement it with additional systems necessary to perform
the financial audit or other audits. In planning the information
security testing for FISMA, the auditor should perform the following
steps to identify a representative subset of agency systems:
* Understand the agency�s systems � The auditor should obtain a
sufficient understanding of the entity�s systems (including the use of
contractors and others to process information and/or to operate systems
for or on behalf of the entity) to plan the evaluation so that it
incorporates a representative subset of entity systems. The IS audit
planning phase discussed in Chapter 2 provides a framework for
understanding the entity�s systems.
* Consider other information security testing � The auditor should
identify information security testing that has been or will be
performed during the fiscal year for which the evaluation is being
performed. The auditor�s evaluation should incorporate the results of
this testing and should, to the extent possible, use such testing as a
basis for the evaluation. For example, testing associated with the
entity�s financial audit can be used to support the independent
evaluation. The evaluation can consider the results of multiple
evaluations. In considering testing performed by parties other than the
auditor, the auditor should consider the competence, independence, and
objectivity of the other parties. (see below)
In determining a representative subset of agency systems, the auditor
should consider the risk level of the systems, as presented in NIST
Federal Information Processing Standards Publication (FIPS PUB) 199,
entitled �Standards for Security Categorization of Federal Information
and Information Systems�. The auditor generally should test some
component of high risk systems annually. In addition, a mix of moderate
and low risk, major general support systems and major applications
generally should be tested annually to ensure adequate coverage of all
systems are performed over time. A representative subset generally
would include a combination of:
* systems at different risk levels (high, moderate, and low);
* both general support systems and major application systems;
* different types of applications (e.g., financial management,
operations) operated by the agency;
* major processing locations;
* general and business process controls, including all of the control
areas;
* contractor and other non-entity systems that are covered by FISMA
requirements. The auditor should consider related IS controls to be
significant to the user organization�s internal control and follow the
procedures discussed in Appendix VII �Entity�s Use of Service
Organizations.�)
In determining the specific systems to be tested in the current
evaluation period, the auditor may consider recent testing performed as
part of a multi-year testing strategy. Also, evidence of continuing
material weaknesses or significant deficiencies may reduce the extent
of testing necessary to reasonably conclude that information security
is ineffective; however, the auditor should consider the benefits of
testing to identify additional weaknesses that the agency can begin to
address.
FISMA requires that an independent evaluation be performed. This means
that the auditor should be independent of the entity in fact and in
appearance. In addition, if the auditor would like to use the work of
other parties as a basis for the auditor�s evaluation, the auditor
should consider the independence and objectivity of the persons
performing the testing on behalf of the agency. If such other parties
are considered independent, the auditor may determine that the work of
the other parties can be used as support for the evaluation without
retesting. The less independent or objective the other parties� work
is, the less the auditor can use the work of the other party without
retesting the other parties� work. If the other parties are not
independent, the auditor should not use such work as a substitute for
their own testing. Although GAGAS is not required to be applied in the
FISMA evaluation, such standards provide guidance on considering
independence that is consistent with other discussions of independence
in professional literature. Also, the auditor may elect to perform the
FISMA evaluation using GAGAS.
Evaluating the Results of Testing:
The FISCAM was designed as a risk-based methodology to assess the
effectiveness of an entity�s information system controls. It can also
be used to assess to provide a reasonable basis for determining whether
information security is effective, and identifying information security
strengths and weaknesses as a basis for that determination. The FISCAM
control activities are consistent with and have been mapped to the NIST
guidance (see Appendix IV).
The Reporting phase discussed in Chapter 2 describes how to evaluate
the results of the tests of controls and conclude as to their
effectiveness In evaluating the results of the testing, the auditor
should determine whether any weaknesses identified, individually or
collectively, represent significant deficiencies as that term is used
in FISMA (see �Related Reporting Responsibilities� in Chapter 2 for
further information.) FISMA requires agencies to report any significant
deficiencies 1) as material weaknesses under FMFIA, or 2) as instances
of a lack of substantial compliance under FFMIA, if related to
financial management systems. Also, the auditor should determine
whether the significant deficiencies collectively result in ineffective
information security controls.
OMB defines a FISMA significant deficiency as �a weakness in an
agency�s overall information systems security program or management
control structure, or within one or more information systems which
significantly restricts the capability of the agency to carry out its
mission or compromises the security of its information, information
systems, personnel, or other resources, operations, or assets. In this
context, the risk is great enough that the agency head and outside
agencies must be notified and immediate or near-immediate corrective
action must be taken.�
The following points provide guidance in applying the FISCAM to
determine whether there is a FISMA significant deficiency:
* ineffective controls over any one of the nine control areas represent
a FISMA significant deficiency,
* ineffective controls over one or more critical elements represent a
FISMA significant deficiency unless, based upon the facts and
circumstances, the auditor believes that other factors sufficiently
mitigate the effect of the control weaknesses, and,
* individual weaknesses or any combination of weaknesses that meet the
above definition represent FISMA significant deficiencies.
Consistent with the IS audit methodology described in Chapter 2, for
each FISCAM critical element, the auditor should make a summary
determination as to the effectiveness of the entity�s related controls
based on the representative subset, considering entitywide, system, and
business process application levels collectively. If the controls for
one or more of each control area�s critical elements are ineffective,
then the controls for the entire control area are not likely to be
effective. The auditor should use professional judgment in making such
determinations.
Also, the auditor should evaluate the risk that the aggregate
combination of weaknesses could result in unauthorized access to key
systems or files. For example, a series of weaknesses might result in
an individual having the ability to gain unauthorized external access
to agency systems, escalate their privileges to obtain root access to
critical network nodes, and consequently to key systems or files.
Further, in evaluating the results of the tests performed, the auditor
should consider several factors, including:
* The likelihood that an individual could obtain unauthorized access to
or perform unauthorized or inappropriate activities on key entity
systems or files that could affect the confidentiality, integrity, and
availability of the agency�s information and information systems. This
might include (1) the ability to obtain root access to system(s) that
house key information or system resources (including supporting
systems), thereby enabling an individual to read, add, delete, or
modify data either directly or through the introduction of unauthorized
software; (2) the ability to directly access and modify file(s) related
to key areas of audit interest: or (3) the ability to assign
unauthorized application user rights, thereby being enabled to enter
unauthorized transactions or perform unauthorized activities.
* The nature of unauthorized access that could be obtained (e.g.,
limited to system or application programmers or system administrators;
authorized system users; or anyone through unauthorized external access
through the Internet).
* The likelihood that other controls, including application controls,
would prevent or detect such unauthorized access. Generally, if the
effectiveness of such other controls depends on computer processed
information, it is unlikely that they could effectively prevent or
detect such access, unless the identified weaknesses could not
reasonably result in the ability to compromise such other controls.
* The risk that management could override controls (such as through
excessive access rights).
Although rare, the entity may have overall compensating controls or
other factors that would mitigate or reduce the risks arising from
control weaknesses. For example, manual reviews of support for all
disbursements could mitigate information security risks related to a
disbursement system. The auditor should determine whether there are any
such compensating controls or other factors. If present, the auditor
should document such controls or factors, test them appropriately to
determine whether they effectively mitigate the identified information
security weaknesses, and draw conclusions about the nature and extent
of the risks that remain after considering such controls or factors.
If there are no significant deficiencies, the auditor may conclude that
information security controls are effective for the subset tested. If
there are one or more FISMA significant deficiencies, and therefore
FMFIA material weaknesses, the auditor should determine whether the
weaknesses, in the aggregate, are severe or pervasive, such that
information security is ineffective. For example, an agency has
effective controls over all of the FISCAM control areas, except for
contingency planning, for which the agency has not adequately tested
their contingency plans for all of the tested systems. The auditor
might conclude that this FISMA significant deficiency is not
sufficiently severe or pervasive to render information security
ineffective. In such instances, the auditor may conclude that
information security controls are effective, except for the FISMA
significant deficiencies. In making this determination, the auditor
should consider whether an �except for� conclusion would be misleading
to a reasonable person reading the evaluation results. If there are one
or more FISMA significant deficiencies and the auditor determines that
an �except for� conclusion is inappropriate, the auditor should deem
information security to be ineffective.
In addition to reporting on the effectiveness of information security
controls, the auditor should determine whether information used in
management reports or used to support FISMA reporting to OMB is
consistent with the results of the testing performed. More
specifically, for each system tested, the auditor should compare the
results of testing with related information included in management and
FISMA reports. For example, the auditor should compare evidence
obtained about a system�s certification and accreditation with
information included in management and FISMA reports to determine
whether such reporting was accurate (e.g., whether a certification and
accreditation was completed). If, in this circumstance, a certification
and accreditation was complete and was reported as such in management
and FISMA reports, but the auditor�s testing revealed that it was not
properly performed, the auditor should consider this deficiency in
their evaluation of the results of testing and determine whether there
are systemic reasons for the deficiency.
To meet the requirements of FISMA, the auditor should report on their
annual independent evaluation of the effectiveness of information
security for the representative subset of systems. Such report should
include:
* The overall conclusion on their assessment of effectiveness of
information security controls, based on testing performed,
* The significant deficiencies identified, and,
* A general discussion of the nature and extent of testing performed.
Such report should be in addition to other OMB reporting requirements.
However, as discussed above, (1) such reporting directly related to a
national security system shall contain only a summary and assessment of
that portion of the evaluation directly relating to a national security
system, and (2) agencies and auditors shall take appropriate steps to
ensure the protection of information which, if disclosed, may adversely
affect information security.
For additional guidance on performing FISMA evaluations, refer to the
PCIE FISMA Framework.
[End of appendix]
Appendix X - Federal Information Security Management Act of 2002
(FISMA):
P.L. 107-347, Title III, sec. 301-305, December 17, 2002.
Title III--Information Security:
Sec. 301. Information Security.
(a) Short Title.--This title may be cited as the "Federal Information
Security Management Act of 2002".
(b) Information Security.--
(1) In general.-- Chapter 35 of title 44, United States Code, is
amended by adding at the end the following new subchapter:
Subchapter III--Information Security:
Sec. 3541. Purposes:
The purposes of this subchapter are to--
(1) provide a comprehensive framework for ensuring the effectiveness of
information security controls over information resources that support
Federal operations and assets;
(2) recognize the highly networked nature of the current Federal
computing environment and provide effective governmentwide management
and oversight of the related information security risks, including
coordination of information security efforts throughout the civilian,
national security, and law enforcement communities;
(3) provide for development and maintenance of minimum controls
required to protect Federal information and information systems;
(4) provide a mechanism for improved oversight of Federal agency
information security programs;
(5) acknowledge that commercially developed information security
products offer advanced, dynamic, robust, and effective information
security solutions, reflecting market solutions for the protection of
critical information infrastructures important to the national defense
and economic security of the nation that are designed, built, and
operated by the private sector; and;
(6) recognize that the selection of specific technical hardware and
software information security solutions should be left to individual
agencies from among commercially developed products.
Sec. 3542. Definitions:
(a) In General.--Except as provided under subsection (b), the
definitions under section 3502 shall apply to this subchapter.
(b) Additional Definitions.--As used in this subchapter:
(1) The term 'information security' means protecting information and
information systems from unauthorized access, use, disclosure,
disruption, modification, or destruction in order to provide:
(A) integrity, which means guarding against improper information
modification or destruction, and includes ensuring information
nonrepudiation and authenticity;
(B) confidentiality, which means preserving authorized restrictions on
access and disclosure, including means for protecting personal privacy
and proprietary information; and;
(C) availability, which means ensuring timely and reliable access to
and use of information.
(2)(A) The term 'national security system' means any information system
(including any telecommunications system) used or operated by an agency
or by a contractor of an agency, or other organization on behalf of an
agency:
(i) the function, operation, or use of which:
(I) involves intelligence activities;
(II) involves cryptologic activities related to national security;
(III) involves command and control of military forces;
(IV) involves equipment that is an integral part of a weapon or weapons
system; or;
(V) subject to subparagraph (B), is critical to the direct fulfillment
of military or intelligence missions; or;
(ii) is protected at all times by procedures established for
information that have been specifically authorized under criteria
established by an Executive order or an Act of Congress to be kept
classified in the interest of national defense or foreign policy.
(B) Subparagraph (A)(i)(V) does not include a system that is to be used
for routine administrative and business applications (including
payroll, finance, logistics, and personnel management applications).
(3) The term 'information technology' has the meaning given that term
in section 11101 of title 40. "Sec. 3543. Authority and functions of
the Director:
(a) In General.--The Director shall oversee agency information security
policies and practices, including:
(1) developing and overseeing the implementation of policies,
principles, standards, and guidelines on information security,
including through ensuring timely agency adoption of and compliance
with standards promulgated under section 11331 of title 40;
(2) requiring agencies, consistent with the standards promulgated under
such section 11331 and the requirements of this subchapter, to identify
and provide information security protections commensurate with the risk
and magnitude of the harm resulting from the unauthorized access, use,
disclosure, disruption, modification, or destruction of:
(A) information collected or maintained by or on behalf of an agency;
or;
(B) information systems used or operated by an agency or by a
contractor of an agency or other organization on behalf of an agency;
(3) coordinating the development of standards and guidelines under
section 20 of the National Institute of Standards and Technology Act
(15 U.S.C. 278g-3) with agencies and offices operating or exercising
control of national security systems (including the National Security
Agency) to assure, to the maximum extent feasible, that such standards
and guidelines are complementary with standards and guidelines
developed for national security systems;
(4) overseeing agency compliance with the requirements of this
subchapter, including through any authorized action under section 11303
of title 40, to enforce accountability for compliance with such
requirements;
(5) reviewing at least annually, and approving or disapproving, agency
information security programs required under section 3544(b);
(6) coordinating information security policies and procedures with
related information resources management policies and procedures;
(7) overseeing the operation of the Federal information security
incident center required under section 3546; and;
(8) reporting to Congress no later than March 1 of each year on agency
compliance with the requirements of this subchapter, including:
(A) a summary of the findings of evaluations required by section 3545;
(B) an assessment of the development, promulgation, and adoption of,
and compliance with, standards developed under section 20 of the
National Institute of Standards and Technology Act (15 U.S.C. 278g-3)
and promulgated under section 11331 of title 40;
(C) significant deficiencies in agency information security practices;
(D) planned remedial action to address such deficiencies; and;
(E) a summary of, and the views of the Director on, the report prepared
by the National Institute of Standards and Technology under section
20(d)(10) of the National Institute of Standards and Technology Act (15
U.S.C. 278g-3).
(b) National Security Systems.--Except for the authorities described in
paragraphs (4) and (8) of subsection (a), the authorities of the
Director under this section shall not apply to national security
systems.
(c) Department of Defense and Central Intelligence Agency Systems.--(1)
The authorities of the Director described in paragraphs (1) and (2) of
subsection (a) shall be delegated to the Secretary of Defense in the
case of systems described in paragraph (2) and to the Director of
Central Intelligence in the case of systems described in paragraph (3).
(2) The systems described in this paragraph are systems that are
operated by the Department of Defense, a contractor of the Department
of Defense, or another entity on behalf of the Department of Defense
that processes any information the unauthorized access, use,
disclosure, disruption, modification, or destruction of which would
have a debilitating impact on the mission of the Department of Defense.
(3) The systems described in this paragraph are systems that are
operated by the Central Intelligence Agency, a contractor of the
Central Intelligence Agency, or another entity on behalf of the Central
Intelligence Agency that processes any information the unauthorized
access, use, disclosure, disruption, modification, or destruction of
which would have a debilitating impact on the mission of the Central
Intelligence Agency.
Sec. 3544. Federal agency responsibilities:
(a) In General.--The head of each agency shall:
(1) be responsible for:
(A) providing information security protections commensurate with the
risk and magnitude of the harm resulting from unauthorized access, use,
disclosure, disruption, modification, or destruction of:
(i) information collected or maintained by or on behalf of the agency;
and;
(ii) information systems used or operated by an agency or by a
contractor of an agency or other organization on behalf of an agency;
(B) complying with the requirements of this subchapter and related
policies, procedures, standards, and guidelines, including:
(i) information security standards promulgated under section 11331 of
title 40; and;
(ii) information security standards and guidelines for national
security systems issued in accordance with law and as directed by the
President; and;
(C) ensuring that information security management processes are
integrated with agency strategic and operational planning processes;
(2) ensure that senior agency officials provide information security
for the information and information systems that support the operations
and assets under their control, including through:
(A) assessing the risk and magnitude of the harm that could result from
the unauthorized access, use, disclosure, disruption, modification, or
destruction of such information or information systems;
(B) determining the levels of information security appropriate to
protect such information and information systems in accordance with
standards promulgated under section 11331 of title 40, for information
security classifications and related requirements;
(C) implementing policies and procedures to cost-effectively reduce
risks to an acceptable level; and;
(D) periodically testing and evaluating information security controls
and techniques to ensure that they are effectively implemented;
(3) delegate to the agency Chief Information Officer established under
section 3506 (or comparable official in an agency not covered by such
section) the authority to ensure compliance with the requirements
imposed on the agency under this subchapter, including:
(A) designating a senior agency information security officer who shall:
(i) carry out the Chief Information Officer's responsibilities under
this section;
(ii) possess professional qualifications, including training and
experience, required to administer the functions described under this
section;
(iii) have information security duties as that official's primary duty;
and;
(iv) head an office with the mission and resources to assist in
ensuring agency compliance with this section;
(B) developing and maintaining an agencywide information security
program as required by subsection (b);
(C) developing and maintaining information security policies,
procedures, and control techniques to address all applicable
requirements, including those issued under section 3543 of this title,
and section 11331 of title 40;
(D) training and overseeing personnel with significant responsibilities
for information security with respect to such responsibilities; and;
(E) assisting senior agency officials concerning their responsibilities
under paragraph (2);
(4) ensure that the agency has trained personnel sufficient to assist
the agency in complying with the requirements of this subchapter and
related policies, procedures, standards, and guidelines; and;
(5) ensure that the agency Chief Information Officer, in coordination
with other senior agency officials, reports annually to the agency head
on the effectiveness of the agency information security program,
including progress of remedial actions.
(b) Agency Program.--Each agency shall develop, document, and implement
an agencywide information security program, approved by the Director
under section 3543(a)(5), to provide information security for the
information and information systems that support the operations and
assets of the agency, including those provided or managed by another
agency, contractor, or other source, that includes:
(1) periodic assessments of the risk and magnitude of the harm that
could result from the unauthorized access, use, disclosure, disruption,
modification, or destruction of information and information systems
that support the operations and assets of the agency;
(2) policies and procedures that:
(A) are based on the risk assessments required by paragraph (1);
(B) cost-effectively reduce information security risks to an acceptable
level;
(C) ensure that information security is addressed throughout the life
cycle of each agency information system; and;
(D) ensure compliance with:
(i) the requirements of this subchapter;
(ii) policies and procedures as may be prescribed by the Director, and
information security standards promulgated under section 11331 of title
40;
(iii) minimally acceptable system configuration requirements, as
determined by the agency; and;
(iv) any other applicable requirements, including standards and
guidelines for national security systems issued in accordance with law
and as directed by the President;
(3) subordinate plans for providing adequate information security for
networks, facilities, and systems or groups of information systems, as
appropriate;
(4) security awareness training to inform personnel, including
contractors and other users of information systems that support the
operations and assets of the agency, of:
(A) information security risks associated with their activities; and;
(B) their responsibilities in complying with agency policies and
procedures designed to reduce these risks;
(5) periodic testing and evaluation of the effectiveness of information
security policies, procedures, and practices, to be performed with a
frequency depending on risk, but no less than annually, of which such
testing:
(A) shall include testing of management, operational, and technical
controls of every information system identified in the inventory
required under section 3505(c); and;
(B) may include testing relied on in a evaluation under section 3545;
(6) a process for planning, implementing, evaluating, and documenting
remedial action to address any deficiencies in the information security
policies, procedures, and practices of the agency;
(7) procedures for detecting, reporting, and responding to security
incidents, consistent with standards and guidelines issued pursuant to
section 3546(b), including:
(A) mitigating risks associated with such incidents before substantial
damage is done;
(B) notifying and consulting with the Federal information security
incident center referred to in section 3546; and;
(C) notifying and consulting with, as appropriate:
(i) law enforcement agencies and relevant Offices of Inspector General;
(ii) an office designated by the President for any incident involving a
national security system; and;
(iii) any other agency or office, in accordance with law or as directed
by the President; and;
(8) plans and procedures to ensure continuity of operations for
information systems that support the operations and assets of the
agency.
(c) Agency Reporting. Each agency shall:
(1) report annually to the Director, the Committees on Government
Reform and Science of the House of Representatives, the Committees on
Governmental Affairs and Commerce, Science, and Transportation of the
Senate, the appropriate authorization and appropriations committees of
Congress, and the Comptroller General on the adequacy and effectiveness
of information security policies, procedures, and practices, and
compliance with the requirements of this subchapter, including
compliance with each requirement of subsection (b);
(2) address the adequacy and effectiveness of information security
policies, procedures, and practices in plans and reports relating to:
(A) annual agency budgets;
(B) information resources management under subchapter 1 of this
chapter;
(C) information technology management under subtitle III of title 40;
(D) program performance under sections 1105 and 1115 through 1119 of
title 31, and sections 2801 and 2805 of title 39;
(E) financial management under chapter 9 of title 31, and the Chief
Financial Officers Act of 1990 (31 U.S.C. 501 note; Public Law 101-576)
(and the amendments made by that Act);
(F) financial management systems under the Federal Financial Management
Improvement Act (31 U.S.C. 3512 note); and;
(G) internal accounting and administrative controls under section 3512
of title 31, (known as the 'Federal Managers Financial Integrity Act');
and "(3) report any significant deficiency in a policy, procedure, or
practice identified under paragraph (1) or (2):
(A) as a material weakness in reporting under section 3512 of title 31;
and;
(B) if relating to financial management systems, as an instance of a
lack of substantial compliance under the Federal Financial Management
Improvement Act (31 U.S.C. 3512 note).
(d) Performance Plan. (1) In addition to the requirements of subsection
(c), each agency, in consultation with the Director, shall include as
part of the performance plan required under section 1115 of title 31 a
description of:
(A) the time periods, and;
(B) the resources, including budget, staffing, and training, that are
necessary to implement the program required under subsection (b).
(2) The description under paragraph (1) shall be based on the risk
assessments required under subsection (b)(2)(1).
(e) Public Notice and Comment. Each agency shall provide the public
with timely notice and opportunities for comment on proposed
information security policies and procedures to the extent that such
policies and procedures affect communication with the public.
Sec. 3545. Annual independent evaluation:
(a) In General. (1) Each year each agency shall have performed an
independent evaluation of the information security program and
practices of that agency to determine the effectiveness of such program
and practices.
(2) Each evaluation under this section shall include:
(A) testing of the effectiveness of information security policies,
procedures, and practices of a representative subset of the agency's
information systems;
(B) an assessment (made on the basis of the results of the testing) of
compliance with:
(i) the requirements of this subchapter; and;
(ii) related information security policies, procedures, standards, and
guidelines; and;
(C) separate presentations, as appropriate, regarding information
security relating to national security systems.
(b) Independent Auditor. Subject to subsection (c):
(1) for each agency with an Inspector General appointed under the
Inspector General Act of 1978, the annual evaluation required by this
section shall be performed by the Inspector General or by an
independent external auditor, as determined by the Inspector General of
the agency; and;
(2) for each agency to which paragraph (1) does not apply, the head of
the agency shall engage an independent external auditor to perform the
evaluation.
(c) National Security Systems. For each agency operating or exercising
control of a national security system, that portion of the evaluation
required by this section directly relating to a national security
system shall be performed;
(1) only by an entity designated by the agency head; and;
(2) in such a manner as to ensure appropriate protection for
information associated with any information security vulnerability in
such system commensurate with the risk and in accordance with all
applicable laws.
(d) Existing Evaluations. The evaluation required by this section may
be based in whole or in part on an audit, evaluation, or report
relating to programs or practices of the applicable agency.
(e) Agency Reporting. (1) Each year, not later than such date
established by the Director, the head of each agency shall submit to
the Director the results of the evaluation required under this section.
(2) To the extent an evaluation required under this section directly
relates to a national security system, the evaluation results submitted
to the Director shall contain only a summary and assessment of that
portion of the evaluation directly relating to a national security
system.
(f) Protection of Information. Agencies and evaluators shall take
appropriate steps to ensure the protection of information which, if
disclosed, may adversely affect information security. Such protections
shall be commensurate with the risk and comply with all applicable laws
and regulations.
(g) OMB Reports to Congress. (1) The Director shall summarize the
results of the evaluations conducted under this section in the report
to Congress required under section 3543(a)(8).
(2) The Director's report to Congress under this subsection shall
summarize information regarding information security relating to
national security systems in such a manner as to ensure appropriate
protection for information associated with any information security
vulnerability in such system commensurate with the risk and in
accordance with all applicable laws.
(3) Evaluations and any other descriptions of information systems under
the authority and control of the Director of Central Intelligence or of
National Foreign Intelligence Programs systems under the authority and
control of the Secretary of Defense shall be made available to Congress
only through the appropriate oversight committees of Congress, in
accordance with applicable laws.
(h) Comptroller General. The Comptroller General shall periodically
evaluate and report to Congress on:
(1) the adequacy and effectiveness of agency information security
policies and practices; and;
(2) implementation of the requirements of this subchapter.
Sec. 3546. Federal information security incident center:
(a) In General. The Director shall ensure the operation of a central
Federal information security incident center to:
(1) provide timely technical assistance to operators of agency
information systems regarding security incidents, including guidance on
detecting and handling information security incidents;
(2) compile and analyze information about incidents that threaten
information security;
(3) inform operators of agency information systems about current and
potential information security threats, and vulnerabilities; and;
(4) consult with the National Institute of Standards and Technology,
agencies or offices operating or exercising control of national
security systems (including the National Security Agency), and such
other agencies or offices in accordance with law and as directed by the
President regarding information security incidents and related matters.
(b) National Security Systems.--Each agency operating or exercising
control of a national security system shall share information about
information security incidents, threats, and vulnerabilities with the
Federal information security incident center to the extent consistent
with standards and guidelines for national security systems, issued in
accordance with law and as directed by the President.
Sec. 3547. National security systems:
The head of each agency operating or exercising control of a national
security system shall be responsible for ensuring that the agency:
(1) provides information security protections commensurate with the
risk and magnitude of the harm resulting from the unauthorized access,
use, disclosure, disruption, modification, or destruction of the
information contained in such system;
2) implements information security policies and practices as required
by standards and guidelines for national security systems, issued in
accordance with law and as directed by the President; and;
(3) complies with the requirements of this subchapter.
Sec. 3548. Authorization of appropriations:
There are authorized to be appropriated to carry out the provisions of
this subchapter such sums as may be necessary for each of fiscal years
2003 through 2007.
Sec. 3549. Effect on existing law:
Nothing in this subchapter, section 11331 of title 40, or section 20 of
the National Standards and Technology Act (15 U.S.C. 278g-3) may be
construed as affecting the authority of the President, the Office of
Management and Budget or the Director thereof, the National Institute
of Standards and Technology, or the head of any agency, with respect to
the authorized use or disclosure of information, including with regard
to the protection of personal privacy under section 552a of title 5,
the disclosure of information under section 552 of title 5, the
management and disposition of records under chapters 29, 31, or 33 of
title 44, the management of information resources under subchapter I of
chapter 35 of this title, or the disclosure of information to the
Congress or the Comptroller General of the United States. While this
subchapter is in effect, subchapter II of this chapter shall not
apply."
(2) Clerical amendment. The table of sections at the beginning of such
chapter 35 is amended by adding at the end the following:
"Subchapter III--Information Security
Sec.
3541. Purposes.
3542. Definitions.
3543. Authority and functions of the Director.
3544. Federal agency responsibilities.
3545. Annual independent evaluation.
3546. Federal information security incident center.
3547. National security systems.
3548. Authorization of appropriations.
3549. Effect on existing law."
(c) Information Security Responsibilities of Certain Agencies.
(1) National security responsibilities.
(A) Nothing in this Act (including any amendment made by this Act)
shall supersede any authority of the Secretary of Defense, the Director
of Central Intelligence, or other agency head, as authorized by law and
as directed by the President, with regard to the operation, control, or
management of national security systems, as defined by section
3542(b)(2) of title 44, United States Code.
(B) Section 2224 of title 10, United States Code, is amended:
(i) in subsection (b), by striking (b) Objectives and Minimum
Requirements. (1) and inserting (b) Objectives of the Program;
(ii) in subsection (b), by striking paragraph (2); and (iii) in
subsection (c), in the matter preceding paragraph (1), by inserting ",
including through compliance with subchapter III of chapter 35 of title
44" after "infrastructure".
(2) Atomic energy act of 1954. Nothing in this Act shall supersede any
requirement made by or under the Atomic Energy Act of 1954 (42 U.S.C.
2011 et seq.). Restricted data or formerly restricted data shall be
handled, protected, classified, downgraded, and declassified in
conformity with the Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq.).
Sec. 302. Management Of Information Technology:
(a) In General. Section 11331 of title 40, United States Code, is
amended to read as follows:
Sec. 11331. Responsibilities for Federal information systems standards:
(a) Standards and Guidelines.
(1) Authority to prescribe.-- Except as provided under paragraph (2),
the Secretary of Commerce shall, on the basis of standards and
guidelines developed by the National Institute of Standards and
Technology pursuant to paragraphs (2) and (3) of section 20(a) of the
National Institute of Standards and Technology Act (15 U.S.C. 278g-
3(a)), prescribe standards and guidelines pertaining to Federal
information systems.
(2) National security systems.-- Standards and guidelines for national
security systems (as defined under this section) shall be developed,
prescribed, enforced, and overseen as otherwise authorized by law and
as directed by the President.
(b) Mandatory Requirements:
(1) Authority to make mandatory.-- Except as provided under paragraph
(2), the Secretary shall make standards prescribed under subsection
(a)(1) compulsory and binding to the extent determined necessary by the
Secretary to improve the efficiency of operation or security of Federal
information systems.
(2) Required mandatory standards. (A) Standards prescribed under
subsection (a)(1) shall include information security standards that:
(i) provide minimum information security requirements as determined
under section 20(b) of the National Institute of Standards and
Technology Act (15 U.S.C. 278g-3(b)); and;
(ii) are otherwise necessary to improve the security of Federal
information and information systems.
(B) Information security standards described in subparagraph (A) shall
be compulsory and binding.
(c) Authority to Disapprove or Modify. The President may disapprove or
modify the standards and guidelines referred to in subsection (a)(1) if
the President determines such action to be in the public interest. The
President's authority to disapprove or modify such standards and
guidelines may not be delegated. Notice of such disapproval or
modification shall be published promptly in the Federal Register. Upon
receiving notice of such disapproval or modification, the Secretary of
Commerce shall immediately rescind or modify such standards or
guidelines as directed by the President.
(d) Exercise of Authority. To ensure fiscal and policy consistency, the
Secretary shall exercise the authority conferred by this section
subject to direction by the President and in coordination with the
Director of the Office of Management and Budget.
(e) Application of More Stringent Standards. The head of an executive
agency may employ standards for the cost-effective information security
for information systems within or under the supervision of that agency
that are more stringent than the standards the Secretary prescribes
under this section if the more stringent standards:
(1) contain at least the applicable standards made compulsory and
binding by the Secretary; and;
(2) are otherwise consistent with policies and guidelines issued under
section 3543 of title 44.
(f) Decisions on Promulgation of Standards. The decision by the
Secretary regarding the promulgation of any standard under this section
shall occur not later than 6 months after the submission of the
proposed standard to the Secretary by the National Institute of
Standards and Technology, as provided under section 20 of the National
Institute of Standards and Technology Act (15 U.S.C. 278g-3).
(g) Definitions. In this section:
(1) Federal information system. The term 'Federal information system'
means an information system used or operated by an executive agency, by
a contractor of an executive agency, or by another organization on
behalf of an executive agency.
(2) Information security. The term 'information security' has the
meaning given that term in section 3542(b)(1) of title 44.
(3) National security system. The term 'national security system' has
the meaning given that term in section 3542(b)(2) of title 44."
(b) Clerical Amendment. The item relating to section 11331 in the table
of sections at the beginning of chapter 113 of such title is amended to
read as follows:
"11331. Responsibilities for Federal information systems standards."
Sec. 303. National Institute Of Standards And Technology.
Section 20 of the National Institute of Standards and Technology Act
(15 U.S.C. 278g-3), is amended by striking the text and inserting the
following:
(a) In General. The Institute shall:
(1) have the mission of developing standards, guidelines, and
associated methods and techniques for information systems;
(2) develop standards and guidelines, including minimum requirements,
for information systems used or operated by an agency or by a
contractor of an agency or other organization on behalf of an agency,
other than national security systems (as defined in section 3542(b)(2)
of title 44, United States Code); and;
(3) develop standards and guidelines, including minimum requirements,
for providing adequate information security for all agency operations
and assets, but such standards and guidelines shall not apply to
national security systems.
(b) Minimum Requirements for Standards and Guidelines. The standards
and guidelines required by subsection (a) shall include, at a minimum:
(1)(A) standards to be used by all agencies to categorize all
information and information systems collected or maintained by or on
behalf of each agency based on the objectives of providing appropriate
levels of information security according to a range of risk levels;
(B) guidelines recommending the types of information and information
systems to be included in each such category; and;
(C) minimum information security requirements for information and
information systems in each such category;
(2) a definition of and guidelines concerning detection and handling of
information security incidents; and;
(3) guidelines developed in conjunction with the Department of Defense,
including the National Security Agency, for identifying an information
system as a national security system consistent with applicable
requirements for national security systems, issued in accordance with
law and as directed by the President.
(c) Development of Standards and Guidelines. In developing standards
and guidelines required by subsections (a) and (b), the Institute
shall:
(1) consult with other agencies and offices and the private sector
(including the Director of the Office of Management and Budget, the
Departments of Defense and Energy, the National Security Agency, the
General Accounting Office, and the Secretary of Homeland Security) to
assure:
(A) use of appropriate information security policies, procedures, and
techniques, in order to improve information security and avoid
unnecessary and costly duplication of effort; and;
(B) that such standards and guidelines are complementary with standards
and guidelines employed for the protection of national security systems
and information contained in such systems;
(2) provide the public with an opportunity to comment on proposed
standards and guidelines;
(3) submit to the Secretary of Commerce for promulgation under section
11331 of title 40, United States Code:
(A) standards, as required under subsection (b)(1)(A), no later than 12
months after the date of the enactment of this section; and;
(B) minimum information security requirements for each category, as
required under subsection (b)(1)(C), no later than 36 months after the
date of the enactment of this section;
(4) issue guidelines as required under subsection (b)(1)(B), no later
than 18 months after the date of the enactment of this section;
(5) to the maximum extent practicable, ensure that such standards and
guidelines do not require the use or procurement of specific products,
including any specific hardware or software;
(6) to the maximum extent practicable, ensure that such standards and
guidelines provide for sufficient flexibility to permit alternative
solutions to provide equivalent levels of protection for identified
information security risks; and;
(7) to the maximum extent practicable, use flexible, performance-based
standards and guidelines that permit the use of off-the-shelf
commercially developed information security products.
(d) Information Security Functions. The Institute shall:
(1) submit standards developed pursuant to subsection (a), along with
recommendations as to the extent to which these should be made
compulsory and binding, to the Secretary of Commerce for promulgation
under section 11331 of title 40, United States Code;
(2) provide technical assistance to agencies, upon request, regarding:
(A) compliance with the standards and guidelines developed under
subsection (a);
(B) detecting and handling information security incidents; and;
(C) information security policies, procedures, and practices;
(3) conduct research, as needed, to determine the nature and extent of
information security vulnerabilities and techniques for providing cost-
effective information security;
(4) develop and periodically revise performance indicators and measures
for agency information security policies and practices;
(5) evaluate private sector information security policies and practices
and commercially available information technologies to assess potential
application by agencies to strengthen information security;
(6) assist the private sector, upon request, in using and applying the
results of activities under this section;
(7) evaluate security policies and practices developed for national
security systems to assess potential application by agencies to
strengthen information security;
(8) periodically assess the effectiveness of standards and guidelines
developed under this section and undertake revisions as appropriate;
(9) solicit and consider the recommendations of the Information
Security and Privacy Advisory Board, established by section 21,
regarding standards and guidelines developed under subsection (a) and
submit such recommendations to the Secretary of Commerce with such
standards submitted to the Secretary; and;
(10) prepare an annual public report on activities undertaken in the
previous year, and planned for the coming year, to carry out
responsibilities under this section.
(e) Definitions. As used in this section:(
1) the term 'agency' has the same meaning as provided in section
3502(1) of title 44, United States Code;
(2) the term 'information security' has the same meaning as provided in
section 3542(b)(1) of such title;
(3) the term 'information system' has the same meaning as provided in
section 3502(8) of such title;
(4) the term 'information technology' has the same meaning as provided
in section 11101 of title 40, United States Code; and;
(5) the term 'national security system' has the same meaning as
provided in section 3542(b)(2) of title 44, United States Code.
(f) Authorization of Appropriations. There are authorized to be
appropriated to the Secretary of Commerce $20,000,000 for each of
fiscal years 2003, 2004, 2005, 2006, and 2007 to enable the National
Institute of Standards and Technology to carry out the provisions of
this section."
Sec. 304. Information Security And Privacy Advisory Board.
Section 21 of the National Institute of Standards and Technology Act
(15 U.S.C. 278g-4), is amended:
(1) in subsection (a), by striking "Computer System Security and
Privacy Advisory Board" and inserting "Information Security and Privacy
Advisory Board";
(2) in subsection (a)(1), by striking "computer or telecommunications"
and inserting "information technology";
(3) in subsection (a)(2):
(A) by striking "computer or telecommunications technology" and
inserting "information technology"; and;
(B) by striking "computer or telecommunications equipment" and
inserting "information technology";
(4) in subsection (a)(3):(
(A) by striking "computer systems" and inserting "information system";
and;
(B) by striking "computer systems security" and inserting "information
security";
(5) in subsection (b)(1) by striking "computer systems security" and
inserting "information security";
(6) in subsection (b) by striking paragraph (2) and inserting the
following:
(2) to advise the Institute, the Secretary of Commerce, and the
Director of the Office of Management and Budget on information security
and privacy issues pertaining to Federal Government information
systems, including through review of proposed standards and guidelines
developed under section 20; and;
(7) in subsection (b)(3) by inserting "annually" after "report";
(8) by inserting after subsection (e) the following new subsection:
(f) The Board shall hold meetings at such locations and at such time
and place as determined by a majority of the Board;"
(9) by redesignating subsections (f) and (g) as subsections (g) and
(h), respectively; and;
(10) by striking subsection (h), as redesignated by paragraph (9), and
inserting the following:
(h) As used in this section, the terms 'information system' and
'information technology' have the meanings given in section 20."
Sec. 305. Technical And Conforming Amendments.
(a) Computer Security Act. Section 11332 of title 40, United States
Code, and the item relating to that section in the table of sections
for chapter 113 of such title, are repealed.
(b) Floyd D. Spence National Defense Authorization Act for Fiscal Year
2001. The Floyd D. Spence National Defense Authorization Act for Fiscal
Year 2001 (Public Law 106-398) is amended by striking section 1062 (44
U.S.C. 3531 note).
(c) Paperwork Reduction Act. (1) Section 3504(g) of title 44, United
States Code, is amended:
(A) by adding "and" at the end of paragraph (1);
(B) in paragraph (2):
(i) by striking "sections 11331 and 11332(b) and (c) of title 40" and
inserting "section 11331 of title 40 and subchapter II of this
chapter"; and (ii) by striking "; and" and inserting a period; and;
(C) by striking paragraph (3).
(2) Section 3505 of such title is amended by adding at the end:
(c) Inventory of Major Information Systems. (1) The head of each agency
shall develop and maintain an inventory of major information systems
(including major national security systems) operated by or under the
control of such agency.
(2) The identification of information systems in an inventory under
this subsection shall include an identification of the interfaces
between each such system and all other systems or networks, including
those not operated by or under the control of the agency.
(3) Such inventory shall be:
(A) updated at least annually;
(B) made available to the Comptroller General; and;
(C) used to support information resources management, including:
(i) preparation and maintenance of the inventory of information
resources under section 3506(b)(4);
(ii) information technology planning, budgeting, acquisition, and
management under section 3506(h), subtitle III of title 40, and related
laws and guidance;
(iii) monitoring, testing, and evaluation of information security
controls under subchapter II;
(iv) preparation of the index of major information systems required
under section 552(g) of title 5, United States Code; and;
(v) preparation of information system inventories required for records
management under chapters 21, 29, 31, and 33.
(4) The Director shall issue guidance for and oversee the
implementation of the requirements of this subsection."
(3) Section 3506(g) of such title is amended:
(A) by adding "and" at the end of paragraph (1);
(B) in paragraph (2):
(i) by striking "section 11332 of title 40" and inserting "subchapter
II of this chapter"; and;
(ii) by striking "; and" and inserting a period; and;
(C) by striking paragraph (3).
[End of appendix]
Appendix XI - Information System Controls Audit Documentation:
This appendix summarizes the audit documentation that should be
prepared by the auditor in connection with the IS controls audit, as
discussed in Chapter 2.
Planning Phase:
The auditor should document the following information developed in the
planning phase:
* Objectives of the IS controls audit and, if it is part of a broader
audit, a description of how such objectives support the overall audit
objectives.
* The scope of the IS controls audit.
* The auditor�s understanding of the entity�s operations and key
business processes, including, to the extent relevant to the audit
objectives, the following:
- The significance and nature of the programs and functions supported
by information systems;
- Key business processes relevant to the audit objectives, including
business rules, transaction flows, and application and software module
interaction;
- Significant general support systems and major applications that
support each key process;
- Background information request, if used;
- Significant internal and external factors that could affect the IS
controls audit objectives;
- Detailed organization chart, particularly the IT and the IS
components;
- Significant changes in the IT environment/architecture or significant
applications implemented within the past 2 years or planned within the
next 2 years; and;
- The entity�s reliance on third parties to provide IT services (e.g.,
in-house, remote connectivity, remote processing).
* A general understanding of the structure of the entity�s or
component�s networks as a basis for planning the IS controls audit,
including high-level and detailed network schematics relevant to the
audit objectives.
* Key areas of audit interest, including relevant general support
systems and major applications and files. This includes (1) the
operational locations of each key system or file, (2) significant
components of the associated hardware and software (e.g., firewalls,
routers, hosts, operating systems), (3) other significant systems or
system-level resources that support the key areas of audit interest,
and (4) prior audit problems reported. Also, the auditor should
document all access paths in and out of the key areas of audit
interest.
* Factors that significantly increase or decrease IS risk and their
potential impact on the effectiveness of information system controls.
For each risk identified, the auditor should document the nature and
extent of the risk; the conditions that gave rise to that risk; and the
specific information or operations affected (if not pervasive).
* Preliminary assessment of IS risks related to the key areas of audit
interest and the basis for the assessed risk. For each risk identified,
the auditor should document the nature and extent of the risk; the
conditions that gave rise to that risk; and the specific information or
operations affected (if not pervasive). The auditor should also
document other considerations that may mitigate the effects of
identified risks.
* Critical control points.
* A preliminary understanding of the entity�s IS controls, including
the organization, staffing, responsibilities, authorities, and
resources of the entity�s security management function. The auditor
should include the following information in the documentation of their
preliminary understanding of the design of IS controls, to the extent
relevant to the audit objectives:
- Identification of entitywide level controls (and appropriate system
level controls) designed to achieve the control activities for each
critical element within each general control area and a determination
of whether they are designed effectively and implemented (placed in
operation), including identification of control activities for which
there are no or ineffective controls at the entitywide level and the
related risks;
- Identification of business process level controls for key
applications identified as key areas of audit interest, determination
of where those controls are implemented (placed in operation) within
the entity�s systems, and the auditor�s conclusion about whether the
controls are designed effectively, including identification of control
activities for which there are no or ineffective controls and the
related risks and the potential impact of any identified design
weaknesses on the completeness, accuracy, validity, and confidentiality
of application data;
- Any internal or third-party information systems reviews, audits, or
specialized systems testing (e.g., penetration tests, disaster recovery
tests, and application-specific tests) performed during the last year;
- Management�s plans of action and milestones, or their equivalent,
that identify corrective actions planned to address known IS control
weaknesses;
- Status of the prior years� audit findings;
- Documentation for any significant computer security related incidents
identified and reported for the last year;
- Documented security plans;
- Documented risk assessments for relevant systems (e.g., general
support systems and major applications);
- System certification and accreditation documentation or equivalent
for relevant systems;
- Documented business continuity of operations plans and disaster
recovery plans; and;
- A description of the entity�s use of third-party IT services.
* Relevant laws and regulations and their relation to the audit
objectives.
* Description of the auditor�s procedures to consider the risk of
fraud, any fraud risk factors that the auditor believes could affect
the audit objectives, and planned audit procedures to detect any fraud
significant to the audit objectives.
* Audit resources planned.
* Current multiyear testing plans.
* Documentation of communications with entity management.
* If IS controls are performed by service organizations, conclusions
whether such controls are significant to the audit objectives and any
audit procedures performed with respect to such controls (e.g., review
of service auditor reports).
* If the auditor plans to use the work of others, conclusions
concerning the planned use of the work of others and any audit
procedures performed with respect to using the work of others.
* Audit plan that adequately describes the objectives, scope, and
methodology of the audit.
* Any decision to reduce testing of IS controls due to the
identification of significant IS control weaknesses.
Testing Phase:
The auditor should document the following information developed in the
testing phase:
* An understanding of the information systems that are relevant to the
audit objectives.
* IS control objectives and activities relevant to the audit
objectives.
* By level (e.g., entitywide, system, business process application) and
system sublevel (e.g., network, operating system, infrastructure
applications), a description of control techniques used by the entity
to achieve the relevant control activities.
* By level and sublevel, specific tests performed, including:
- related documentation that describes the nature, timing, and extent
of the tests;
- evidence of the effective operation of the control techniques or lack
thereof (e.g., memos describing procedures and results, output of tools
and related analysis);
- if a control activity is not achieved, any compensating controls or
other factors and the basis for determining whether they are effective;
- the auditor�s conclusions about the effectiveness of the entity�s IS
controls in achieving the control activity; and;
- for each weakness, whether the weakness is a material weakness,
significant deficiency, or just a deficiency, as well as the criteria,
condition, cause, and effect if necessary to achieve the audit
objectives.
Reporting Phase:
The auditor should document the following information developed in the
reporting phase:
* The auditor�s conclusion about the effectiveness of IS controls (in
relation to the IS controls audit objectives) in achieving the critical
elements and the relevant control activities and the basis for the
conclusion, including the factors that the auditor considered in making
the determination.
* If part of a broader audit, the impact of any identified IS control
weaknesses on the overall audit objectives.
* Copies of any reports or written communications issued in connection
with the audit, including entity management comments related to such
reports and communications.
* For financial audits and attestation engagements, the auditor�s
determination of whether identified weaknesses represent material
weaknesses or significant deficiencies, and the basis for the auditor�s
conclusions.
* Other documentation required by the audit organization�s policies and
procedures, including quality assurance processes.
* Results of procedures to detect any fraud significant to the audit
objectives and the impact on the audit.
* Results of audit follow-up procedures to determine whether agency
corrective actions have been implemented, based on risk and a cost
benefit analysis, to sufficiently remediate previously reported IS
control weaknesses.
* As appropriate, the auditor�s considerations and determinations
concerning FMFIA, FFMIA, and other reporting responsibilities.
[End of appendix]
Appendix XII - Glossary:
The definitions in this glossary are drawn from various sources,
including this manual and the materials in the bibliography. In
addition, certain definitions were developed by project staff and
contractors.
Acceptance testing:
Final testing by users to decide whether to accept a new system.
Access control:
The process of granting or denying specific requests: 1) for obtaining
and using information and related information processing services; and
2) to enter specific physical facilities (e.g., Federal buildings,
military establishments, and border crossing entrances).
Access control list (ACL):
A register of: 1) users (including groups, machines, and processes) who
have been given permission to use a particular system resource, and 2)
the types of access they have been permitted.
Access control software:
(CA-ACF2, RACF, CA-Top Secret); This type of software, which is
external to the operating system, provides a means of specifying who
has access to a system, which has access to specific resources, and
what capabilities authorized users are granted. Access control software
can generally be implemented in different modes that provide varying
degrees of protection such as denying access for which the user is not
expressly authorized, allowing access which is not expressly authorized
but providing a warning, or allowing access to all resources without
warning regardless of authority.
Access method:
The technique used for selecting records in a file for processing,
retrieval, or storage.
Access path:
Sequence of hardware and software components significant to access
control. Any component capable of enforcing access restrictions or any
component that could be used to bypass an access restriction should be
considered part of the access path. The access path can also be defined
as the path through which a user request travels, including the
telecommunications software, transaction processing software,
application program, etc.
Access path diagram:
Network schematic that identifies the users of the system, the type of
device from which they can access the system, the software used to
access the system, the resource they may access, the system on which
these resources reside, and the modes of operation and
telecommunication paths.
Access privileges:
Precise statements that define the extent to which an individual can
access computer systems and use or modify the programs and data on a
system, and under what circumstances this access will be allowed.
Access rights:
Also called permissions or privileges, these are the rights granted to
users by the administrator or supervisor. Access rights determine the
actions users can perform (e.g., read, write, execute, create and
delete) on files in shared volumes or file shares on the server.
Accountability:
The security goal that generates the requirement for actions of an
entity to be traced uniquely to that entity. This supports non-
repudiation, deterrence, fault isolation, intrusion detection and
prevention, and after-action recovery and legal action.
Account Management:
Involves (1) the process of requesting, establishing, issuing, and
closing user accounts; (2) tracking users and their respective access
authorizations; and (3) managing these functions.
Accreditation:
The official management decision given by a senior agency official to
authorize operation of an information system and to explicitly accept
the risk to agency operations (including mission, functions, image, or
reputation), agency assets, or individuals, based on the implementation
of an agreed-upon set of security controls.
Accreditation boundary:
All components of an information system to be accredited by an
authorizing official and excludes separately accredited systems, to
which the information system is connected.
Accuracy:
See Accuracy Control.
Accuracy control:
Controls that are designed to provide reasonable assurance that
transactions are properly recorded, with correct amount/data, and on a
timely basis (in the proper period); key data elements input for
transactions are accurate; data elements are processed accurately by
applications that produce reliable results; and output is accurate.
Adequate security:
Security commensurate with the risk and the magnitude of harm resulting
from the loss, misuse, or unauthorized access to or modification of
information.
Advanced Encryption Standard (AES):
The Advanced Encryption Standard specifies a U.S. Government-approved
cryptographic algorithm that can be used to protect electronic data.
The AES algorithm is a symmetric block cipher that can encrypt
(encipher) and decrypt (decipher) information.
Alternate work site:
Entity authorized work at home or at geographically convenient
satellite offices (e.g., telecommuting).
Application controls:
Application controls, sometimes referred to as business controls, are
incorporated directly into computer applications to help ensure the
validity, completeness, accuracy, and confidentiality of data during
application processing and reporting.
Application level general controls:
Controls consist of general controls operating at the business process
application level, including those related to security management,
access controls, configuration management, segregation of duties, and
contingency planning.
Application System:
The use of information resources to satisfy a specific set of user
requirements. Performs a certain type of work, including specific
functions such as payroll, inventory control, accounting, and mission
support. Depending on the work for which it was designed, an
application system can manipulate text, numbers, graphics, or a
combination of these elements.
Application programmer:
A person who develops and maintains application programs, as opposed to
system programmers who develop and maintain the operating system and
system utilities.
Application programs:
See application system.
Assertion:
Financial statement assertions are management representations that are
embodied in financial statement components. The assertions can be
either explicit or implicit and can be classified into the following
broad categories: existence or occurrence (an entity�s assets or
liabilities exist at a given date and recorded transactions have
occurred during a given period; completeness (all transactions and
accounts that should be presented in the financial statements are
included; rights and obligations (assets are the rights of the entity
and liabilities are the obligations of the entity at a given date;
valuation or allocation (asset, liability, revenue, and expense
components have been included in the financial statements at
appropriate amounts; and presentation and disclosure (the particular
components of the financial statements are properly classified,
described, and disclosed).
Attack:
Attempt to gain unauthorized access to an information system�s
services, resources, or information, or the attempt to compromise an
information system�s integrity, availability, or confidentiality.
Audit logging:
Recording of user activity in a system or application initiated by the
user (e.g., access to a file, record, or field, use of modem). Further,
it may record any attempts to log on (successful or unsuccessful) to a
system and record log on ID, date and time of each log on.
Audit plan:
A high level description of the audit work to be performed in a certain
period of time (ordinarily a year). It includes the areas to be
audited, the type of work planned, the high level objectives and scope
of the work, and topics such as budget, resource allocation, schedule
dates, type of report and its intended audience and other general
aspects of the work.
Auditable event:
A system activity identified by the agency�s audit monitoring system
that may be indicative of a violation of security policy. The activity
may range from simple browsing to attempts to plant a Trojan horse or
gain unauthorized access privilege.
Audit risk:
For financial statement audits, the risk that the auditor may
unknowingly fail to appropriately modify the audit opinion on financial
statements that are materially misstated. In a performance audit, the
risk that the auditor�s findings, conclusions, recommendations, or
assurance may be improper or incomplete.
Audit strategy:
Plan for assessing organizational activities based on an understanding
of the entity�s business processes and related risk assessments.
Audit trail:
A record showing who has accessed an Information Technology (IT) system
and what operations the user has performed during a given period.
Authentication:
Verifying the identity of a user, process, or device, often as a
prerequisite to allowing access to resources in an information system.
Authenticity:
The property of being genuine and being able to be verifies and
trusted; confidence in the validity of a transmission, a message, or
message originator. See authentication.
Authorization:
The official management decision given by a senior agency official to
authorize operation of an information system and to explicitly accept
the risk to agency operations (including mission, functions, image, or
reputation), agency assets, or individuals, based on the implementation
of an agreed-upon set of security controls.
Authorizing official:
Official with the authority to formally assume responsibility for
operating an information system at an acceptable level of risk to
agency operations (including mission, functions, image, or reputation),
agency assets, or individuals.
Availability:
Ensuring timely and reliable access to and use of information.
Backdoor:
An undocumented way to gain access to a program, data, or an entire
computer system, often known only to the programmer who created it.
Backdoors can be handy when the standard way of getting information is
unavailable, but they usually constitute a security risk.
Backup:
Any duplicate of a primary resource function, such as a copy of a
computer program or data file. This standby is used in case of loss or
failure of the primary resource.
Backup procedures:
A regular maintenance procedure that copies all new or altered files to
a backup storage medium, such as a tape drive.
Baseline configuration:
Current inventory of all entity hardware, software, and firmware plus
approved changes from the baseline.
Biometric: A physical or behavioral characteristic of a human being.
Boundary:
Software, hardware, or physical barrier that limits access to a system
or part of a system.
Boundary Protection:
Monitoring and control of communications at the external boundary
between information systems completely under the management and control
of the organization, and at key internal boundaries between information
systems completely under the management and control of the
organization, to prevent and detect malicious and other unauthorized
communication, employing controlled interfaces (e.g., proxies,
gateways, routers, firewalls, encrypted tunnels).
Browsing:
The act of electronically perusing files and records without
authorization.
Business Impact Analysis (BIA):
An analysis of an information technology (IT) system�s requirements,
processes, and interdependencies used to characterize system
contingency requirements and priorities in the event of a significant
disruption.
Business process:
Processes that are the primary functions that the entity performs in
accomplishing its mission. Examples include, financial management
processes, such as collections, disbursements, or payroll; and mission-
related processes, typically at the program or subprogram level, such
as education, public health, law enforcement, or income security.
Business process application:
A computer program designed to help perform a business function such as
payroll, inventory control, accounting, and mission support. Depending
on the work for which it was designed, an application can manipulate
text, numbers, graphics, or a combination of these elements.
Business process application controls:
Controls directly related to individual computerized applications. They
help ensure that transactions are complete, accurate, valid, and
confidential. These controls include programmed control techniques,
such as automated edits, and manual follow-up of computer generated
reports, such as reviews of reports identifying rejected or unusual
items.
Business process application level:
Controls at the business process application level consist of policies,
procedures for controlling specific processes. For example, the
entity�s configuration management should reasonably ensure that all
changes to application systems are fully tested and authorized.
Business process controls (FISCAM):
These controls are the automated and/or manual controls applied to
business transaction flows. They relate to the completeness, accuracy,
validity and confidentiality of transactions and data during
application processing.
Bypass label processing (BLP):
The technique of reading a computer file while bypassing the internal
file/data set label. This process could result in bypassing security
access controls.
CAAT:
See computer-assisted audit technique.
CD-ROM:
See compact disk-read only memory.
Central processing unit (CPU):
The computational and control unit of a computer; the device that
interprets and executes instructions.
Certificate:
A digital representation of information which at least 1) identifies
the certification authority issuing it, 2) names or identifies its
subscriber, 3) contains the subscriber's public key, 4) identifies its
operational period, and 5) is digitally signed by the certification
authority issuing it.
Certificate Authority (CA):
A trusted third party that serves authentication infrastructures or
organizations and registers entities and issues them certificates.
Certificate Management:
Process whereby certificates (as defined above) are generated, stored,
protected, transferred, loaded, used, and destroyed.
Certification:
A comprehensive assessment of the management, operational, and
technical security controls in an information system, made in support
of security accreditation, to determine the extent to which the
controls are implemented correctly, operating as intended, and
producing the desired outcome with respect to meeting the security
requirements for the system.
Certification and Accreditation:
A comprehensive assessment of the management, operational, and
technical security controls in an information system, made in support
of security accreditation, to determine the extent to which the
controls are implemented correctly, operating as intended, and
producing the desired outcome with respect to meeting the security
requirements for the system. Accreditation is the official management
decision given by a senior agency official to authorize operation of an
information system and to explicitly accept the risk to agency
operations (including mission, functions, image, or reputation), agency
assets, or individuals, based on the implementation of an agreed-upon
set of security controls.
Certification Authority:
A trusted entity that issues and revokes public key certificates.
Checkpoint:
The process of saving the current state of a program and its data,
including intermediate results, to disk or other nonvolatile storage,
so that, if interrupted, the program could be restarted at the point at
which the last checkpoint occurred.
Chief Information Officer:
Agency official responsible for ensuring agency compliance with, and
prompt, efficient, and effective implementation of, information
policies and information resources management responsibilities,
including information security and the management of information
technology.
Cipher key lock:
A lock with a key pad-like device that requires the manual entry of a
predetermined code for entry.
Cipher text:
Data output from the Cipher or input to the Inverse Cipher. Data in its
encrypted form.
Code:
Instructions written in a computer programming language. (See object
code and source code.)
Cold site:
An IS backup facility that has the necessary electrical and physical
components of a computer facility, but does not have the computer
equipment in place. The site is ready to receive the necessary
replacement computer equipment in the event that the user has to move
from their main computing location to an alternative site.
Collaborative computing:
Applications and technology (e.g., white boarding, group conferencing)
that allow two or more individuals to share information real time in an
inter- or intra-enterprise environment.
Command:
A job control statement or a message, sent to the computer system, that
initiates a processing task.
Compact disc-read only memory (CD-ROM):
Compact Disc (CD)-Read Only Memory (ROM) is a form of optical, rather
than magnetic, storage. CD-ROM devices are generally read only.
Compensating control:
An internal control that reduces the risk of an existing or potential
control weakness that could result in errors or omissions.
Compiler:
A program that reads the statements in a human-readable programming
language and translates them into a machine-readable executable
program.
Completeness control:
Controls that ensure entity management that all transactions that
occurred are entered into the system, accepted for processing, and
processed once and only once by the system and are properly included in
output.
Component:
A single resource with defined characteristics, such as a terminal or
printer. These components are also defined by their relationship to
other components.
Computer-assisted audit technique (CAAT):
Any automated audit technique, such as generalized audit software, test
data generators, computerized audit programs, and special audit
utilities.
Computer facility:
A site or location with computer hardware where information processing
is performed or where data from such sites are stored.
Computer operations:
The function responsible for operating the computer and peripheral
equipment, including providing the tape, disk, or paper resources as
requested by the application systems.
Computer processing location:
See computer facility.
Computer resource:
See resource.
Computer room:
Room within a facility that houses computers and/or telecommunication
devices.
Computer security:
Measures and controls that ensure confidentiality, integrity, and
availability of IS assets including hardware, software, firmware, and
information being processed, stored, and communicated.
Computer system:
A complete computer installation, including peripherals, in which all
the components are designed to work with each other.
Computer-related controls:
Computer-related controls help ensure the reliability, confidentiality,
and availability of automated information. They include both general
controls, which apply to all or a large segment of an entity�s
information systems, and application controls, which apply to
individual applications.
Computing environment:
Workstation or server (host) and its operating system, peripherals, and
applications.
Confidentiality:
Preserving authorized restrictions on access and disclosure, including
means for protecting personal privacy and proprietary information.
Confidentiality control:
Controls that are designed to provide reasonable assurance that
application data and reports and other output are protected against
unauthorized access.
Configuration auditing:
Procedures for determining alignment between the actual system and the
documentation describing it, thereby ensuring that the documentation
used to support decision making is complete and correct.
Configuration control:
Process for controlling modifications to hardware, firmware, software,
and documentation to ensure the information system is protected against
improper modifications prior to, during, and after system
implementation.
Configuration control board:
Evaluates and approves or disapproves proposed changes to configuration
items and ensures implementation of approved changes.
Configuration identification:
Procedures for identifying, documenting, and assigning unique
identifiers (for example, serial numbers and name) to a system�s
hardware and software component parts and subparts generally referred
to as configuration items.
Configuration settings:
Information system parameters that provide only essential capabilities
and specifically prohibit or restrict the use of unnecessary functions,
ports, protocols, and services.
Configuration status accounting:
A procedure for documenting and reporting on the status of
configuration items as a system evolves. Documentation, such as
historical change lists and original designs or drawings, are generated
and kept in a library, thereby allowing entities to continuously know
the state of a system�s configuration and be in a position to make
informed decisions about changing the configuration.
Configuration management:
The control and documentation of changes made to a system�s hardware,
software, and documentation throughout the development and operational
life of the system.
Console:
Traditionally, a control unit such as a terminal through which a user
communicates with a computer. In the mainframe environment, a console
is the operator�s station.
Contingency plan:
Management policy and procedures designed to maintain or restore
business operations, including computer operations, possibly at an
alternate location, in the event of emergencies, system failure, or
disaster.
Contingency planning:
See contingency plan.
Continuity of Operations Plan (COOP):
A predetermined set of instructions or procedures that describe how an
organization�s essential functions will be sustained for up to 30 days
as a result of a disaster event before returning to normal operations.
Control activities:
Descriptions of individual control requirements for each critical
control element (e.g., implement effective authorization controls,
adequately protect sensitive system resources).
Control categories:
Groupings of related controls pertaining to similar types of risk.
Control categories include security management, access controls,
configuration management, segregation of duties, and contingency
planning.
Control deficiency:
In financial audits, a control deficiency in an entity�s internal
control over financial reporting exists when the design or operation of
a control does not allow management or employees, in the normal course
of performing their assigned functions, to prevent or detect
misstatements on a timely basis. Control deficiency In single audits, a
control deficiency in an entity�s internal control over compliance
exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their
assigned functions, to prevent or detect noncompliance with a type of
compliance requirement of a federal program on a timely manner.
Control dependency:
Exists when the effectiveness of an internal control is dependent on
the effectiveness of other internal controls.
Control environment:
The control environment is an important component of an entity�s
internal control structure. It sets the �tone at the top� and can
influence the effectiveness of specific control techniques. Factors
that influence the control environment include management�s philosophy
and operating style, the entity�s organizational structure, methods of
assigning authority and responsibility, management�s control methods
for monitoring and following up on performance, the effectiveness of
the Inspector General�s and internal audits, personnel policies and
practices, and influences external to the entity.
Control objectives:
The intent of the specific control to effectively secure specific
general support or business activities.
Control risk:
In a financial statement audit, the risk that a material misstatement
that could occur in an assertion will not be prevented, or detected and
corrected on a timely basis by the entity�s internal control structure.
Control techniques:
The specific control implemented by the entity to secure a specific
general support system or business process activity.
Controlled Interface:
Mechanism that facilitates the adjudication of different interconnected
system security policies (e.g., controlling the flow of information
into or out of an interconnected system).
Countermeasures:
Actions, devices, procedures, techniques, or other measures that reduce
the vulnerability of an information system. Synonymous with security
controls and safeguards.
CPU:
See central processing unit.
Critical control point:
System control points that, if compromised, could allow an individual
to gain unauthorized access to or perform unauthorized or inappropriate
activities on entity systems or data, which could lead directly or
indirectly to unauthorized access or modifications to the key areas of
audit interest.
Cryptography:
The science of coding messages so they cannot be read by any person
other than the intended recipient. Ordinary text�or plain text�and
other data are transformed into coded form by encryption and translated
back to plain text or data by decryption.
Data:
Facts and information that can be communicated and manipulated. Data
access method See access method.
Data administration:
The function that plans for and administers the data used throughout
the entity. This function is concerned with identifying, cataloging,
controlling, and coordinating the information needs of the entity.
Database:
A collection of related information about a subject organized in a
useful manner that provides a base or foundation for procedures, such
as retrieving information, drawing conclusions, or making decisions.
Any collection of information that serves these purposes qualifies as a
database, even if the information is not stored on a computer.
Database administrator (DBA):
The individual responsible for both the design of the database,
including the structure and contents, and the access capabilities of
application programs and users to the database. Additional
responsibilities include operation, performance, integrity, and
security of the database.
Database management:
Tasks related to creating, maintaining, organizing, and retrieving
information from a database.
Database management system (DBMS):
(DB2, IMS, IDMS) A software product that aids in controlling and using
the data needed by application programs. DBMSs organize data in a
database, manage all requests for database actions�such as queries or
updates from users�and permit centralized control of security and data
integrity.
Data center:
See computer facility.
Data communications:
The transfer of information from one computer to another through a
communications medium, such as telephone lines, microwave relay,
satellite link, or physical cable.
Data communications systems:
See data communications.
Data design:
Organization of data into structures to facilitate retrieval while
minimizing redundancy. The design of transaction data elements is a
critical factor in helping assure the quality of data as well as its
interrelationship with other data elements.
Data definition:
Identification of all fields in the database, how they are formatted,
how they are combined into different types of records, and how the
record types are interrelated.
Data file:
See file.
Data management systems:
Applications which handle significant volumes of data often employ data
management system to perform certain data processing functions within
an application. Data management systems include database management
systems, specialized data transport/communications software (often
called middleware, cryptography used in conjunction with data integrity
controls, data warehouse software and data reporting/data extraction
software.
Data owner:
See owner.
Data processing:
The computerized preparation of documents and the flow of data
contained in these documents through the major steps of recording,
classifying, and summarizing.
Data processing center:
See computer facility.
Data quality standard:
Requirements to ensure the state of completeness, validity,
consistency, timeliness and accuracy that makes data appropriate for a
specific use. Data security See security management function.
Data strategy:
Plan used to identify data needed to support business processes. A
clearly defined data strategy minimizes data redundancies fundamental
to an efficient, effective transaction processing function.
Data validation:
Checking transaction data for any errors or omissions that can be
detected by examining the data.
Data warehouse:
A generic term for a system used to store, retrieve, and manage large
amounts of data. A database, often remote, that contains recent
snapshots of corporate data that can be used for analysis without
slowing down day-to-day operations of the production database.
DBA:
See database administrator.
DBMS:
See database management system.
Debug:
With software, to detect, locate, and correct logical or syntactical
errors in a computer program.
Decryption:
The process of changing ciphertext using a cryptographic algorithm and
key.
Defense-in-depth:
A commonly accepted �best practice� for implementing computer security
controls in today�s networked environments. Integrates people,
operations, and technology capabilities to protect information systems
across multiple layers.
Delete access:
This level of access provides the ability to erase or remove data or
programs.
Denial of Service (DOS):
The prevention of authorized access to resources or the delaying of
time-critical operations. (Time-critical may be milliseconds or it may
be hours, depending upon the service provided.)
Denial of Service (DOS) Attack:
An assault on a service from a single source that floods it with so
many requests that it becomes overwhelmed and is either stopped
completely or operates at a significantly reduced rate.
Detection risk:
The risk that the auditor will not detect a material misstatement that
exists in an assertion.
Dial-up access:
A means of connecting to another computer, or a network similar to the
Internet, over a telecommunications line using a modem-equipped
computer.
Dial-back:
Used as a control over dial-up telecommunications lines. The
telecommunications link established through dial-up into the computer
from a remote location is interrupted so the computer can dial back to
the caller. The link is permitted only if the caller is from a valid
phone number or telecommunications channel.
Digital Certificate:
A certificate identifying a public key to its subscriber, corresponding
to a private key held by that subscriber. It is a unique code that
typically is used to allow the authenticity and integrity of
communicated data to be verified.
Digital signature:
Cryptographic process used to assure message originator authenticity,
integrity, and nonrepudiation.
Direct access:
An access method for finding an individual item on a storage device and
accessing it directly, without having to access all preceding records.
Disaster recovery plan:
A written plan for processing critical applications in the event of a
major hardware or software failure or destruction of facilities.
Diskette:
A removable and widely-used data storage medium that uses a
magnetically coated flexible disk of Mylar enclosed in a plastic case.
DNS (domain name system):
A hierarchical database that is distributed across the Internet that
allows names to be resolved into IP addresses (and vice versa) to
locate services such as web and e-mail servers.
DSS:
See decision support system.
Download:
Process of transferring data from a central computer to a personal
computer or workstation.
Edit controls:
Detects errors in the input portion of information that is sent to the
computer for processing. The controls may be manual or automated and
allow the user to edit data errors before processing.
Electronic signature:
A symbol generated through electronic means that can be used to (1)
identify the sender of information and (2) ensure the integrity of the
critical information received from the sender. An electronic signature
may represent either an individual or an entity. Adequate electronic
signatures are (1) unique to the signer, (2) under the signer�s sole
control, (3) capable of being verified, and (4) linked to the data in
such a manner that, if data are changed, the signature is invalidated
upon verification. Traditional user identification code/password
techniques do not meet these criteria.
Embedded Audit Module:
Integral part of an application system that is designed to identify and
report specific transactions or other information based on pre-
determined criteria. Identification of reportable items occurs as part
of real-time processing. Reporting may be real-time online, or may use
store and forward methods. Also known as integrated test facility or
continuous auditing module.
Encryption:
Encryption is the conversion of data into a form, called a cipher text,
which cannot be easily understood by unauthorized people.
Enterprise Resource Planning (ERP):
Commercial software that integrates all the information flowing through
the entity. ERP systems contain functional modules (e.g., financial,
accounting, human resources, supply chain, and customer information)
that are integrated within the core system or interfaced to external
systems.
Entity or component level:
Controls at the entity or component level consist of the entitywide or
componentwide processes designed to achieve the control activities.
They are focused on how the entity or component manages IS related to
each general control activity.
Entitywide information security program:
An entitywide information security program is the foundation of a
security control structure and a reflection of senior management�s
commitment to addressing security risks. The security management
program establishes a framework and continuous cycle of activity for
assessing risk, developing and implementing effective security
procedures, and monitoring the effectiveness of these procedures.
Entry points:
Access points to the entity�s information systems. This may include
remote access through dial-up, wireless devices, or the Internet
Environmental controls:
This subset of physical access controls prevents or mitigates damage to
facilities and interruptions in service. Smoke detectors, fire alarms
and extinguishers, and uninterruptible power supplies are some examples
of environmental controls.
Execute access:
This level of access provides the ability to execute a program.
Exit:
A predefined or in-house written routine that receives controls at a
predefined point in processing. These routines provide an entity with
the flexibility to customize processing, but also create the
opportunity to bypass security controls.
Field:
A location in a record in which a particular type of data are stored.
In a database, the smallest unit of data that can be named. A string of
fields is a concatenated field or record.
File:
A collection of records stored in computerized form.
Financial management system:
Financial information systems and the financial portions of mixed
systems (systems that support both financial and nonfinancial
functions) that are necessary to support financial management.
Firewall:
Hardware and software components that protect one set of system
resources (e.g., computers, networks) from attack by outside network
users (e.g., Internet users) by blocking and checking all incoming
network traffic. Firewalls permit authorized users to access and
transmit privileged information and deny access to unauthorized users.
Firmware:
Program recorded in permanent or semi permanent computer memory.
FISMA:
Enacted into law as Title III of the E-Government Act of 2002 (PL 107-
347; December 17, 2002), FISMA authorized and strengthened information
security program, evaluation, and reporting requirements.
FMFIA:
The objective of the Federal Managers� Financial Integrity Act of 1982
(FMFIA) is to provide reasonable assurance that (1) obligations and
costs are in compliance with applicable law, (2) funds, property, and
other assets are safeguarded against waste, loss, unauthorized use, or
misappropriation, and (3) revenues and expenditures applicable to
agency operations are properly recorded and accounted for to permit the
preparation of accounts and reliable financial and statistical reports
and to maintain accountability over the assets.
Flowchart:
A diagram of the movement of transactions, computer functions, media,
and/or operations within a system. The processing flow is represented
by arrows between symbolic shapes for operation, device, data file,
etc. to depict the system or program.
Fraud:
Fraud is a type of illegal act involving the obtaining of something of
value through willful misrepresentation.
FTP (file transfer protocol):
A protocol used to transfer files over a TCP/IP network (Internet,
UNIX, etc.)
GAGAS:
Also referred to as the Yellow Book. IT provides standards and guidance
for use by government auditors to ensure that they maintain competence,
integrity, objectivity, and independence in planning, conducting, and
reporting their work, and are to be followed by auditors and audit
organizations when required by law regulation, contract, agreement, or
policy.
Gateway:
In networks, a computer that connects two dissimilar local area
networks, or connects a local area network to a wide area network,
minicomputer, or mainframe. A gateway may perform network protocol
conversion and bandwidth conversion.
General controls:
General controls are the structure, policies, and procedures that apply
to an entity�s overall computer operations. They include an entitywide
security program, access controls, application development and change
controls, segregation of duties, system software controls, and service
continuity controls.
General support system:
An interconnected set of information resources under the same direct
management control that shares common functionality. Normally, the
purpose of a general support system is to provide processing or
communications support.
Hacker:
A person who attempts to enter a system without authorization from a
remote location.
Hardware:
The physical components of IT, including the computers, peripheral
devices such as printers, disks, and scanners, and cables, switches,
and other elements of the telecommunications infrastructure.
Hashing:
Value computed on data to detect error or manipulation.
Hot site:
A fully operational off-site data processing facility equipped with
both hardware and system software to be used in the event of a
disaster.
HTTP (hyper text transfer protocol):
A communication protocol used to connect to servers on the World Wide
Web. Its primary function is to establish a connection with a web
server and transmit HTML pages to the client browser.
HTTPS (hyper text transfer protocol secure):
A protocol for accessing a secure web server, whereby all data
transferred is encrypted.
Hub:
A common connection point for devices in a network, hubs commonly is
used to connect segments of a LAN. A hub contains multiple ports. When
a packet arrives at one port, it is copied to the other ports so that
all segments of the LAN can see all packets.
Identification:
The process of verifying the identity of a user, process, or device,
usually as a prerequisite for granting access to resources in an IT
system.
IDS:
See intrusion detection system.
IEEE:
Institute of Electrical and Electronics Engineers)--Pronounced I-triple-
E, IEEE is an organization composed of engineers, scientists and
students. The IEEE is best known for developing standards for the
computer and electronics industry.
Implementation:
The process of making a system operational in the organization.
Incident:
Assessed occurrence having actual or potentially adverse effects on an
IS.
Incident response program:
A process that involves detecting a problem, determining its cause,
minimizing the damage it causes, resolving the problem, and documenting
each step of the response for future reference.
Incompatible duties:
When work responsibilities are not segregated so that one individual
controls critical stages of a process incompatible duties exist. For
example, while users may authorize program changes, programmers should
not be allowed to do so because they are not the owners of the system
and do not have the responsibility to see that the system meets user
needs. Similarly, one computer programmer should not be allowed to
independently write, test, and approve program changes.
Information:
The meaning of data. Data are facts; they become information when they
are seen in context and convey meaning.
Information resource owner:
See owner.
Information Security:
The protection of information and information systems from unauthorized
access, use, disclosure, disruption, modification, or destruction in
order to provide confidentiality, integrity, and availability.
Information System:
A discrete set of information resources organized for the collection,
processing, maintenance, use, sharing, dissemination, or disposition of
information.
Information system boundaries:
Logical or physical boundaries around information resources and
implementing measures to prevent unauthorized information exchange
across the boundary in either direction. Firewall devices represent the
most common boundary protection technology at the network level.
Information Security:
Protecting information and information systems from unauthorized
access, use, disclosure, disruption, modification, or destruction to
provides integrity, confidentiality, and availability.
Information System (IS) Control:
As defined in GAGAS, information system (IS) controls consist of those
internal controls that are dependent on information systems processing
and include general controls and application controls.
Information System Owner (or Program Manager):
Official responsible for the overall procurement, development,
integration, modification, or operation and maintenance of an
information system.
Information systems management:
The function that directs or manages the activities and staff of the IS
department and its various organizational components.
Information Type:
A specific category of information (e.g., privacy, medical,
proprietary, financial, investigative, contractor sensitive, security
management) defined by an organization or in some instances, by a
specific law, executive order, directive, policy, or regulation.
Infrastructure application:
Include software that is used to assist in performing systems
operations, including management of network devices. These applications
include database, e-mail, browsers, plug-ins, utilities, and
applications not directly related to business processes.
Input:
Any information entered into a computer, or the process of entering
data into the computer.
Integration testing:
Testing to determine if related information system components perform
to specifications.
Integrity:
Guarding against improper information modification or destruction, and
includes ensuring information nonrepudiation and authenticity. This
involves ensuring that transmitted or stored data are not altered by
unauthorized persons in a way that is not detectable by authorized
users.
Interface:
A connection between two devices, applications, or networks or a
boundary across which two systems communicate. Interface may also refer
to the portion of a program that interacts with the user.
Interface controls:
Controls used to provide reasonable assurance that data used by
applications that is input from legacy systems is reliable, valid,
complete, and properly converted from the legacy application into the
applications they support.
Interface design:
Uses guidelines set by the strategy and provides specific information
for each of the characteristics defined in the strategy. See Interface
Strategy.
Interface strategy:
Describes at the highest level how the interfaces are implemented
between two applications, The interface strategy includes an
explanation of each interface, the interface method chosen (manual or
batch, etc.), the data fields being interfaced, the controls to
reasonably assure that the data is interfaced completely and
accurately, timing requirements, assignment of responsibilities, on-
going system balancing requirements, and security requirements.
Internal control (also referred to as internal control structure):
A process, affected by agency management and other personnel, designed
to provide reasonable assurance that (1) operations, including the use
of agency resources, are effective and efficient; (2) financial
reporting, including reports on budget execution, financial statements,
and other reports for internal and external use, are reliable; and (3)
applicable laws and regulations are followed. Internal control also
includes the safeguarding of agency assets against unauthorized
acquisition, use, or disposition. Internal control consists of 5
interrelated components that form an integrated process that can react
to changing circumstances and conditions within the agency. These
components include the control environment, risk assessment, control
activities, information and communication, and monitoring.
Internet:
When capitalized, the term �Internet� refers to the collection of
networks and gateways that use the transmission control
protocol/Internet protocol suite of protocols.
Internet protocol:
Standard protocol for transmission of data from source to destinations
in packet-switched communications networks and interconnected systems
of such networks.
Intrusion:
Any intentional violation of the security policy of a system.
Intrusion Detection System (IDS):
An intrusion detection system (IDS) inspects network activity to
identify suspicious patterns that may indicate a network or system
attack from someone attempting to break into or compromise a system
Intranet:
A private network that uses the infrastructure and standards of the
Internet and World Wide Web, but is isolated from the public Internet
by firewall barriers.
Inventory:
FISMA requires that each agency develop, maintain, and annually update
an inventory of major information systems operated by the agency or
under its control. The inventory must include identification of the
interfaces between agency systems and all other systems or networks,
including interfaces not controlled by the agency.
Job:
A set of data that completely defines a unit of work for a computer. A
job usually includes programs, linkages, files, and instructions to the
operating system.
Key:
A long stream of seemingly random bits used with cryptographic
algorithms. The keys must be known or guessed to forge a digital
signature or decrypt an encrypted message.
Key area of audit interest:
Those areas which are critical to achieving the audit objectives (e.g.,
general support and business process application systems and files or
components thereof).
LAN:
See local area network.
Label:
See security label.
Least Privilege:
Principle requiring that each subject be granted the most restrictive
set of privileges needed for the performance of authorized tasks.
Application of this principle limits the damage that can result from
accident, error, or unauthorized use of an IS.
Legacy system:
A computer system consisting of older applications and hardware that
was developed to solve a specific business problem. Many legacy systems
do not conform to current standards, but are still in use because they
solve the problem and replacing them would be too expensive.
Library:
In computer terms, a library is a collection of similar files, such as
data sets contained on tape and/or disks, stored together in a common
area. Typical uses are to store a group of source programs or a group
of load modules. In a library, each program is called a member.
Libraries are also called partitioned data sets (PDS). Library can also
be used to refer to the physical site where magnetic media, such as a
magnetic tape, is stored. These sites are usually referred to as tape
libraries.
Library control/management:
The function responsible for controlling program and data files that
are either kept on-line or on tapes and disks that are loaded onto the
computer as needed.
Library copier:
Software that can copy source code from a library into a program.
Library management software:
Software that provides an automated means of inventorying software,
ensuring that differing versions are not accidentally misidentified,
and maintaining a record of software changes.
Local area network (LAN):
A group of computers and other devices dispersed over a relatively
limited area and connected by a communications link that enables a
device to interact with any other on the network. Local area networks
(LAN) commonly include microcomputers and shared (often expensive)
resources such as laser printers and large hard disks. Most modern LANs
can support a wide variety of computers and other devices. Separate
LANs can be connected to form larger networks.
Log:
With respect to computer systems, to record an event or transaction.
Log on:
The process of establishing a connection with, or gaining access to, a
computer system or peripheral device.
Logging file:
See log.
Logical access control:
The use of computer hardware and software to prevent or detect
unauthorized access. For example, users may be required to input user
identification numbers (ID), passwords, or other identifiers that are
linked to predetermined access privileges.
Logical security:
See logical access control.
Mainframe computer:
A multi-user computer designed to meet the computing needs of a large
organization. The term came to be used to refer generally to the large
central computers developed in the late 1950s and 1960s to meet the
accounting and information management needs of large organizations.
Maintenance:
Altering programs after they have been in use for a while. Maintenance
programming may be performed to add features, correct errors that were
not discovered during testing, or update key variables (such as the
inflation rate) that change over time.
Major application:
OMB Circular A-130 defines a major application as an application that
requires special attention due to the risk and magnitude of the harm
resulting from the loss, misuse, or unauthorized access to, or
modification of, information in the application.
Malicious code:
Software or firmware intended to perform an unauthorized process that
will have adverse impact on the confidentiality, integrity, or
availability of an information system. A virus, worm, Trojan horse, or
other code-based entity that infects a host.
Management controls:
The organization, policies, and procedures used to provide reasonable
assurance that (1) programs achieve their intended result, (2)
resources are used that are consistent with the organization�s mission,
(3) programs and resources are protected from waste, fraud, and
mismanagement, (4) laws and regulations are followed, and (5) reliable
and timely information is obtained, maintained, reported, and used for
decision making.
Master console:
In MVS environments, the master console provides the principal means of
communicating with the system. Other multiple console support (MCS)
consoles often serve specialized functions, but can have master
authority to enter all MVS commands.
Master data:
Referential data that provides the basis for ongoing business
activities, e.g., customers, vendors, and employees.
Master data controls:
Controls over master data, the key information that is relatively
constant and shared between multiple functions or applications (e.g.,
vendors, customers, employee�s data, and vendor files).
Master data design:
Layout of key data requirements to ensure integrity and utility of data
information. Data integrity requirements include, for example,
requiring an entry in all key fields, such as address and account
number and not accepting invalid values in the required fields.
Master file:
In a computer, the most currently accurate and authoritative permanent
or semi-permanent computerized record of information maintained over an
extended period.
Material weakness�A-123:
A material weakness is a reportable condition in which the design or
operation of the internal controls does not reduce to a relatively low
level the risk that losses, noncompliance, or misstatements in amounts
that would be material in relation to the principal statements or to a
performance measure or aggregation of related performance measures may
occur and not be detected within a timely period by employees in the
normal course of their assigned duties.
Material weakness�A-123:
Control deficiency or combination of control deficiencies that in
management�s judgement should be communicated because they represent
significant weaknesses in the design or operation of internal control
that could adversely affect the organization�s ability to meet its
internal control objectives.
Material weakness � financial reporting:
A significant deficiency or combination of significant deficiencies
that results in more than a remote likelihood that a material
misstatement of the financial statements will not be prevented or
detected.
Material weakness � single audit compliance:
A significant deficiency or combination of significant deficiencies,
that result in more than a remote likelihood that material
noncompliance with a type of compliance requirement of a federal
program will not be prevented or detected by the entity�s internal
control.
Materiality:
An auditing concept regarding the relative importance of an amount or
item. An item is considered not to be material when it is not
significant enough to influence decisions or have an effect on the
financial statements.
Media controls:
Controls implemented to prevent unauthorized physical access to digital
(e.g., diskettes, flash/thumb drives, compact disks) and printed media
(e.g., paper, microfilm) removed from information system and during
pick-up, transport, and delivery to authorized users.
Merge access:
This level of access provides the ability to combine data from two
separate sources.
Microcomputer:
Any computer with its arithmetic logic unit and control unit contained
in one integrated circuit, called a microprocessor.
Microprocessor:
An integrated circuit device that contains the miniaturized circuitry
to perform arithmetic, logic, and control operations (i.e. contains the
entire CPU on a single chip).
Middleware:
Another term for an application programmer interface (API). It refers
to the interfaces that allow programmers to access lower- or higher-
level services by providing an intermediary layer that includes
function calls to the services.
Migration:
A change from an older hardware platform, operating system, or software
version to a newer one.
Mobile code:
Software programs or parts of programs obtained from remote information
systems, transmitted across a network, and executed on a local
information system without explicit installation or execution by the
recipient.
Mobile computing:
Ability to use technology that is not physically connected, or in
remote or mobile (non static) environments. Requires that the mobile
computing activity be connected wirelessly to and through the internet
or to and through a private network. This connection ties the mobile
device to centrally located information and/or application software
through the use of battery powered, portable, and wireless computing
and communication devices. This includes devices like laptops with
wireless LAN or wireless WAN technology, smart mobile phones, wearable
computers and Personal Digital Assistants (PDAs).
Modem:
Short for modulator-demodulator. A device that allows digital signals
to be transmitted and received over analog telephone lines. This type
of device makes it possible to link a digital computer to the analog
telephone system. It also determines the speed at which information can
be transmitted and received.
Multiyear testing plan:
Where IS audits are performed on a regular basis the auditor may
develop a multiyear audit plan. Such a plan will cover relevant key
agency applications, systems, and processing centers. These strategic
plans should cover no more than 3-year period and include the schedule
and scope of assessments to be performed during the period and the
rationale for planned approach.
Naming conventions:
Standards for naming computer resources, such as data files, program
libraries, individual programs, and applications.
Network:
A group of computers and associated devices that are connected by
communications facilities. A network can involve permanent connections,
such as cables, or temporary connections made through telephone or
other communications links. A network can be as small as a local area
network consisting of a few computers, printers, and other devices, or
it can consist of many small and large computers distributed over a
vast geographic area.
Network administration:
The function responsible for maintaining secure and reliable network
operations. This function serves as a liaison with user departments to
resolve network needs and problems.
Network architecture:
The underlying structure of a computer network, including hardware,
functional layers, interfaces, and protocols (rules) used to establish
communications and ensure the reliable transfer of information. Because
a computer network is a mixture of hardware and software, network
architectures are designed to provide both philosophical and physical
standards for enabling computers and other devices to manage the
complexities of establishing communications links and transferring
information without conflict. Various network architectures exist,
among them the internationally accepted seven-layer open systems
interconnection model and International Business Machine (IBM) Systems
Network Architecture. Both the open systems interconnection model and
the Systems Network Architecture organize network functions in layers,
each layer dedicated to a particular aspect of communication or
transmission and each requiring protocols that define how functions are
carried out. The ultimate objective of these and other network
architectures is the creation of communications standards that will
enable computers of many kinds to exchange information freely.
Network component:
Devices that support a network including, workstations, servers,
switches, and routers.
Network scanning:
Procedure for identifying active hosts on a network, either for the
purpose of attacking them or for network security assessment. Scanning
procedures, such as ping sweeps and port scans, return information
about which IP addresses map to live hosts that are active on the
Internet and what services they offer. Another scanning method, inverse
mapping, returns information about what IP addresses do not map to live
hosts; this enables an attacker to make assumptions about viable
addresses.
Network session:
A connection between two network component peers. This provides the
capability of bundling of resources needed for an instance of a
service.
NIST:
Under FISMA Act of 2002, the National Institute of Standards and
Technology (NIST) develops computer security prototypes, tests,
standards, and procedures to protect sensitive information from
unauthorized access or modification. Focus areas include cryptographic
technology and applications, advanced authentication, public key
infrastructure, internetworking security, criteria and assurance, and
security management and support.
Node:
In a local area network, a connection point that can create, receive,
or repeat a message. Nodes include repeaters, file servers, and shared
peripherals. In common usage, however, the term node is synonymous with
workstation.
Nonrepudiation:
The ability to prevent senders from denying that they have sent
messages and receivers from denying that they have received messages.
Object code:
The machine code generated by a source code language processor such as
an assembler or compiler. A file of object code may be immediately
executable or it may require linking with other object code files,
e.g., libraries, to produce a complete executable program.
Object privilege:
Allows the user to have access to the data within an object or allow
the user to execute a stored program. These include: Select, Insert,
Delete, etc. Each type of object has different privileges associated
with it.
Off-the-shelf software:
Software that is marketed as a commercial product, unlike custom
programs that are privately developed for a specific client.
Online:
A processing term that categorizes operations that are activated and
ready for use. If a resource is online, it is capable of communicating
with or being controlled by a computer. For example, a printer is
online when it can be used for printing. An application is classified
as online when users interact with the system as their information is
being processed, as opposed to batch processing.
Online editors:
See online program development software.
Online program development software:
(TSO, ROSCOE, VOLLIE, ICCF, ISPF) Software that permits programs to be
coded and compiled in an interactive mode.
Operating system:
The software that controls the execution of other computer programs,
schedules tasks, allocates storage, manages the interface to peripheral
hardware, and presents a default interface to the user when no
application program is running.
Operational controls:
Relate to managing the entity�s business and include policies and
procedures to carry out organizational objectives, such as planning,
productivity, programmatic, quality, economy, efficiency, and
effectiveness objectives. Management uses these controls to provide
reasonable assurance that the entity (1) meets its goals, (2) maintains
quality standards, and (3) does what management directs it to do.
Output:
Data/information produced by computer processing, such as graphic
display on a terminal or hard copy.
Output devices:
Peripheral equipment, such as a printer or tape drive, that provides
the results of processing in a form that can be used outside the
system.
Override:
Decision made by agency management or operation staff to bypass
established control(s) to allow a transaction or transactions that
would otherwise be rejected by the system controls to be processed.
Owner:
Manager or director who has responsibility for a computer resource,
such as a data file or application program.
Packet:
Data unit that is routed from source to destination in a packet-
switched network. A packet contains both routing information and data.
Transmission control protocol/Internet protocol (TCP/IP) is such a
packet-switched network.
Packet Filtering:
Controlling access to a network by analyzing the attributes of the
incoming and outgoing packets and either letting them pass, or denying
them, based on a list of rules.
Parameter:
A value that is given to a variable. Parameters provide a means of
customizing programs.
Partitioning:
Process of physically or logically separating different functions such
as applications, security and communication activities. Separation may
be accomplished by using different computers, different central
processing units, different instances of the operating systems,
different network addresses, or combinations of these methods.
Password:
A confidential character string used to authenticate an identity or
prevent unauthorized access.
Password Cracker:
Specialized security checker that tests user�s passwords, searching for
passwords that are easy to guess by repeatedly trying words from
specially crafted dictionaries. Failing that, many password crackers
can brute force all possible combinations in a relatively short period
of time with current desktop computer hardware.
Patch:
Patches are additional pieces of code that have been developed to
address specific problems or flaws in existing software.
Vulnerabilities are flaws that can be exploited, enabling unauthorized
access to IT systems or enabling users to have access to greater
privileges than authorized.
Penetration testing:
Security testing in which evaluators attempt to circumvent the security
features of a system based on their understanding of the system design
and implementation.
Peripheral:
A hardware unit that is connected to and controlled by a computer, but
that is external to the CPU. These devices provide input, output, or
storage capabilities when used in conjunction with a computer.
Personally identifiable information:
Refers to any information about an individual maintained by an agency,
including any information that can be used to distinguish or trace an
individual�s identity, such as their name, social security number, date
of birth, or biometric records, and any other information which is
linked or linkable to an individual.
Personnel controls:
This type of control involves screening individuals prior to their
authorization to access computer resources. Such screening should be
commensurate with the risk and magnitude of the harm the individual
could cause.
Personnel security:
See personnel controls.
Physical access control:
This type of control involves restricting physical access to computer
resources and protecting these resources from intentional or
unintentional loss or impairment.
Physical security:
See physical access control.
Plain text:
Data input to the Cipher or output from the Inverse Cipher.
Plans of Action and Milestones:
A document that identifies tasks needing to be accomplished. It details
resources required to accomplish the elements of the plan, any
milestones in meeting the tasks, and scheduled completion dates for the
milestones.
Platform:
The foundation technology of a computer system. Typically, a specific
combination of hardware and operating system.
Privacy Impact Assessment:
An analysis of how information is handled: (1) to ensure handling
conforms to applicable legal, regulatory, and policy requirements
regarding privacy; (2) to determine the risks and effects of
collecting, maintaining, and disseminating information in identifiable
form in an electronic information system; and (3) to examine and
evaluate protections and alternative processes for handling information
to mitigate potential privacy risks.
Privileged account:
Individuals who have access to set �access rights� for users on a given
system. Sometimes referred to as system or network administrative
accounts.
Privileged User:
Individual who has access to system control, monitoring, or
administration functions (e.g., system administrator, system security
officer, maintainers, system programmers, etc.)
Process:
Systematic sequences of operations to produce a specified result. This
includes all functions performed within a computer such as editing,
calculating, summarizing, categorizing, and updating.
Processing:
The execution of program instructions by the computer�s CPU.
Production control and scheduling:
The function responsible for monitoring the information into, through,
and as it leaves the computer operations area and for determining the
succession of programs to be run on the computer. Often, an automated
scheduling package is used in this task.
Production environment:
The system environment where the agency performs its operational
information processing activities.
Production programs:
Programs that are being used and executed to support authorized
organizational operations. Such programs are distinguished from �test�
programs that are being developed or modified, but have not yet been
authorized for use by management.
Profile:
A set of rules that describe the nature and extent of access to
available resources for a user or a group of users with similar duties,
such as accounts payable clerks. (See standard profile and user
profile.)
Program:
A set of related instructions that, when followed and executed by a
computer, perform operations or tasks. Application programs, user
programs, system programs, source programs, and object programs are all
software programs.
Program library:
See library.
Programmer:
A person who designs, codes, tests, debugs, and documents computer
programs.
Proprietary:
Privately owned, based on trade secrets, privately developed
technology, or specifications that the owner refuses to divulge, which
prevents others from duplicating a product or program unless an
explicit license is purchased.
Protocol:
In data communications and networking, a standard that specifies the
format of data as well as the rules to be followed when performing
specific functions, such as establishing a connection and exchanging
data.
Public access controls:
A subset of access controls that apply when an agency application
promotes or permits public access. These controls protect the integrity
of the application and public confidence in the application and include
segregating the information made directly available to the public from
official agency records.
Public domain software:
Software that has been distributed with an explicit notification from
the program�s author that the work has been released for unconditional
use, including for-profit distribution or modification by any party
under any circumstances.
Public Key Infrastructure (PKI):
A set of policies, processes, server platforms, software and
workstations used for the purpose of administering certificates and
public-private key pairs, including the ability to issue, maintain, and
revoke public key certificates.
Quality assurance:
The function that reviews software project activities and tests
software products throughout the software life cycle to determine if
(1) the software project is adhering to its established plans,
standards, and procedures and (2) the software meets the functional
specifications defined by the user.
Query:
The process of extracting data from a database and presenting it for
use.
Read access:
This level of access provides the ability to look at and copy data or a
software program.
Real-time system:
A computer and/or a software system that reacts to events before they
become obsolete. This type of system is generally interactive and
updates files as transactions are processed.
Record:
A unit of related data fields. The group of data fields that can be
accessed by a program and contains the complete set of information on a
particular item.
Reliability:
The capability of hardware or software to perform as the user expects
and to do so consistently, without failures or erratic behavior.
Remote access:
The process of communicating with a computer located in another place
over a communications link.
Remote job entry (RJE):
With respect to computer systems with locations geographically separate
from the main computer center, submitting batch processing jobs via a
data communications link.
Remote Maintenance:
Maintenance activities conducted by individuals communicating external
to an information system security perimeter.
Reportable condition � A 123:
Reportable conditions include matters coming to the auditor�s attention
that, in the auditor�s judgment, should be communicated because they
represent significant deficiencies in the design or operation of
internal controls, which could adversely affect the entity�s ability to
meet its internal control objectives.
Repudiation:
The denial by one of the parties to a transaction or participation in
all or part of that transaction or of the content of communications
related to that transaction.
Residual risk:
Portion of risk remaining after security measures have been applied.
Resource:
Something that is needed to support computer operations, including
hardware, software, data, telecommunications services, computer
supplies such as paper stock and preprinted forms, and other resources
such as people, office facilities, and noncomputerized records.
Risk:
The level of impact on agency operations (including mission, functions,
image, or reputation), agency assets, or individuals resulting from the
operation of an information system given the potential impact of a
threat and the likelihood of that threat occurring.
Risk analysis:
The process of identifying the risks to system security and determining
the likelihood of occurrence, the resulting impact, and the additional
safeguards that mitigate this impact. Part of risk management and
synonymous with risk assessment.
Risk assessment:
The identification and analysis of possible risks in meeting the
agency�s objectives that forms a basis for managing the risks
identified and implementing deterrents.
Risk management:
A management approach designed to reduce risks inherent in systems
development and operations.
Router:
An intermediary device on a communications network that expedites
message delivery. As part of a LAN, a router receives transmitted
messages and forwards them to their destination over the most efficient
available route.
Run:
A popular, idiomatic expression for program execution.
Run manual:
A manual that provides application-specific operating instructions,
such as instructions on job setup, console and error messages, job
checkpoints, and restart and recovery steps after system failures.
Safeguards:
Protective measures prescribed to meet the security requirements (i.e.,
confidentiality, integrity, and availability) specified for an
information system. Safeguards may include security features,
management constraints, personnel security, and security of physical
structures, areas, and devices. Synonymous with security controls and
countermeasures.
Sanitization:
Process to remove information from media such that information recovery
is not possible. It includes removing all labels, markings, and
activity logs.
SAS 70:
Statement on Auditing Standards No. 70: Service Organizations, commonly
abbreviated as SAS 70, is an auditing statement issued by the Auditing
Standards Board of the American Institute of Certified Public
Accountants (AICPA), officially titled �Reports on the Processing of
Transactions by Service Organizations�. SAS 70 defines the professional
standards used by a service auditor to assess the internal controls of
a service organization and issue a service auditor�s report. Service
organizations are typically entities that provide outsourcing services
that impact the control environment of their customers.
SDLC methodology:
See system development life cycle methodology.
Security:
The protection of computer facilities, computer systems, and data
stored on computer systems or transmitted via computer networks from
loss, misuse, or unauthorized access. Computer security, as defined by
Appendix III to OMB Circular A-130, involves the use of management,
personnel, operational, and technical controls to ensure that systems
and applications operate effectively and provide confidentiality,
integrity, and availability.
Security administrator:
Person who is responsible for managing the security program for
computer facilities, computer systems, and/or data that are stored on
computer systems or transmitted via computer networks.
Security Category:
The characterization of information or an information system based on
an assessment of the potential impact that a loss of confidentiality,
integrity, or availability of such information or information system
would have on organizational operations, organizational assets, or
individuals.
Security Controls:
The management, operational, and technical controls (i.e., safeguards
or countermeasures) prescribed for an information system to protect the
confidentiality, integrity, and availability of the system and its
information.
Security Label:
Explicit or implicit marking of a data structure or output media
associated with an information system representing the FIPS 199
security category, or distribution limitations or handling caveats of
the information contained therein.
Security management function:
The function responsible for the development and administration of an
entity�s information security program. This includes assessing risks,
implementing appropriate security policies and related controls,
establishing a security awareness and education program for employees,
and monitoring and evaluating policy and control effectiveness.
Security Objective:
Confidentiality, integrity, or availability.
Security plan:
A written plan that clearly describes the entity�s security program and
policies and procedures that support it. The plan and related policies
should cover all major systems and facilities and should outline the
duties of those who are responsible for overseeing security (the
security management function) as well as those who own, use, or rely on
the entity�s computer resources.
Security policy:
The set of management statements that documents an organization�s
philosophy of protecting its computing and information assets. The set
of security rules enforced by the system�s security features.
Security profile:
See profile.
Security requirements:
Requirements levied on an information system that are derived from
laws, executive orders, directives, policies, instructions,
regulations, or organizational (mission) needs to ensure the
confidentiality, integrity, and availability of the information being
processed, stored, or transmitted.
Security software:
See access control software.
Segregation/separation of duties:
A basic control that prevents or detects errors and irregularities by
assigning responsibility for initiating transactions, recording
transactions and custody of assets to separate individuals. Commonly
used in large IT organizations so that no single person is in a
position to introduce fraudulent or malicious code without detection.
Sensitive information:
Any information that an agency has determined requires heightened
protection from unauthorized access, use, disclosure, disruption,
modification, or destruction [e.g., by using specific access controls]
because of the nature of the information (e.g., personal information
required to be protected by the Privacy Act, proprietary commercial
information, information critical to law enforcement activities, and
information that has or may be determined to be exempt from public
release under the Freedom of Information Act).
Sensitivity accounts:
See privileged account.
Server:
A computer running administrative software that controls access to all
or part of the network and its resources, such as disk drives or
printers. A computer acting as a server makes resources available to
computers acting as workstations on the network.
Service:
Refers to customer or product-related business functions such as file
transfer protocol (FTP), hypertext transfer protocol (HTTP), and
mainframe supervisor calls. Each system provides a set of services. For
example, a computer network calls its users to send packets to
specified destinations and a database system responds to queries.
Service auditor:
An independent auditor hired by the service organization to provide a
report on internal controls at the service provider. See Service
Organization.
Service Bureau:
A computer facility that provides data processing services to clients
on a continual basis.
Service organization:
Outside organizations used to support business processes. Service
organizations provide services ranging from performing a specific task
(e.g., payroll processing) to replacing entire business units or
functions of an entity.
Significant deficiency � FISMA:
A weakness in an agency�s overall information systems security program
or management control structure, or within one or more information
systems, that significantly restricts the capability of the agency to
carry out its mission or compromises the security of its information,
information systems, personnel, or other resources, operations, or
assets.
Significant deficiency � A-123:
OMB Circular A-123 uses the same definition for significant deficiency
as financial reporting (See Significant Deficiency � Financial
Reporting), but continues to refer to it as a reportable condition.
Significant Deficiency � financial reporting:
A deficiency in internal control, or combination of deficiencies, that
adversely affects the entity�s ability to initiate, authorize, record,
process, or report financial data reliably in accordance with generally
accepted accounting principles such that there is more than a remote
likelihood that a misstatement of the entity�s financial statements
that is more than inconsequential will not be prevented or detected.
Significant deficiency � single audit compliance:
A control deficiency, or combination of control deficiencies, that
adversely affects the entity�s ability to administer a federal program
such that there is more than a remote likelihood that noncompliance
with a type of compliance requirement of a federal program that is more
than inconsequential will not be prevented or detected by the entity�s
internal control.
Simultaneous peripheral operations online (SPOOL):
In the mainframe environment, a component of system software that
controls the transfer of data between computer storage areas with
different speed capabilities. Usually, an intermediate device, such as
a buffer, exists between the transfer source and the destination (e.g.,
a printer).
Single audit:
The single audit is intended to provide a cost-effective audit for
nonfederal entities in that one audit is conducted in lieu of multiple
audits of individual programs. Such audits are performed in accordance
with the Single Audit Act of 1984 (with amendment in 1996) and OMB
Circular A-133 (Audits of States, Local Governments, and Non-Profit
Organizations) to ensure that federal funds to nonfederal entities are
expended properly.
Smart card:
A credit card-sized token that contains a microprocessor and memory
circuits for authenticating a user of computer, banking, or
transportation services.
SMTP (Simple Mail Transport Protocol):
The standard e-mail protocol on the Internet.
Sniffer:
Synonymous with packet sniffer. A program that intercepts routed data
and examines each packet in search of specified information, such as
passwords transmitted in clear text.
Social engineering:
A method used by hackers to obtain passwords for unauthorized access.
For example, a hacker may call an authorized user of a computer system
and pose as a network administrator to gain access.
Software:
A computer program or programs, in contrast to the physical environment
on which programs run (hardware).
Source code:
Human-readable program statements written in a high-level or assembly
language, as opposed to object code, which is derived from source code
and designed to be machine-readable.
Spyware:
Software that is secretly or surreptitiously installed into an
information system to gather information on individuals or
organizations without their knowledge.
Standard:
In computing, a set of detailed technical guidelines used as a means of
establishing uniformity in an area of hardware or software development.
Standard profile:
A set of rules that describe the nature and extent of access to each
resource that is available to a group of users with similar duties,
such as accounts payable clerks.
Supervisor call (SVC):
A supervisor call instruction interrupts a program being executed and
passes control to the supervisor so that it can perform a specific
service indicated by the instruction.
Switch:
A device that forwards packets between LAN devices or segments. LANs
that use switches are called switched LANs.
System:
See information system.
System administrator:
The person responsible for administering use of a multi-user computer
system, communications system, or both.
System analyst:
A person who designs systems.
System designer:
See system analyst.
System developer:
See programmer.
System development life cycle (SDLC) methodology:
The policies and procedures that govern software development and
modification as a software product goes through each phase of its life
cycle.
System level:
Controls consist of processes for managing specific system resources
related to either a general support system or business process
application systems. Three sublevels include network, operating system,
and infrastructure.
System management facility:
An IBM control program that provides the means for gathering and
recording information that can be used to evaluate the extent of
computer system usage.
System privilege:
Ability of the user within the database to interact with the database
itself. They include: CREATE, ALTER, DROP, CONNECT, and AUDIT, among
many others.
System programmer:
A person who develops and maintains system software.
System security plan:
Formal document that provides an overview of the security requirements
for the information system and describes the security controls in place
or planned for meeting those requirements.
System software:
The set of computer programs and related routines designed to operate
and control the processing activities of computer equipment. It
includes the operating system and utility programs and is distinguished
from application software.
System testing:
Testing to determine that the results generated by the enterprise�s
information systems and their components are accurate and the systems
perform to specifications.
System utilities:
Software used to perform system maintenance routines that are
frequently required during normal processing operations. Some of the
utilities have powerful features that will allow a user to access and
view or modify data or program code.
TCP (transmission control protocol):
A connection-based Internet protocol that supports reliable data
transfer connections. Packet data is verified using checksums and
retransmitted if it is missing or corrupted. The application plays no
part in validating the transfer.
TCP/IP protocol:
Transmission Control Protocol/Internet Protocol) A set of
communications protocols that encompasses media access, packet
transport, session communications, file transfer, electronic mail,
terminal emulation, remote file access and network management. TCP/IP
provides the basis for the Internet.
Technical controls:
See logical access control.
Telecommunications:
A general term for the electronic transmission of information of any
type, such as data, television pictures, sound, or facsimiles, over any
medium, such as telephone lines, microwave relay, satellite link, or
physical cable.
Teleprocessing monitor:
In the mainframe environment, a component of the operating system that
provides support for online terminal access to application programs.
This type of software can be used to restrict access to online
applications and may provide an interface to security software to
restrict access to certain functions within the application.
Terminal:
A device consisting of a video adapter, a monitor, and a keyboard.
Test facility:
A processing environment that is isolated from the production
environment and dedicated to testing and validating systems and/or
their components.
Those charged with governance:
Are those responsible for overseeing the strategic direction of the
entity and the entity�s fulfillment of its obligations related to
accountability. This includes overseeing the financial reporting
process, subject matter, or program under audit including related
internal controls.
Threat:
Any circumstance or event with the potential to adversely impact agency
operations (including mission, functions, image, or reputation), agency
assets, or individuals through an information system via unauthorized
access, destruction, disclosure, modification of information, and/or
denial of service.
Token:
In authentication systems, some type of physical device (such as a card
with a magnetic strip or a smart card) that must be in the individual�s
possession in order to gain access. The token itself is not sufficient;
the user must also be able to supply something memorized, such as a
personal identification number (PIN).
Transaction:
A discrete activity captured by a computer system, such as the entry of
a customer order or an update of an inventory item. In financial
systems, a transaction generally represents a business event that can
be measured in money and entered in accounting records.
Transaction data:
The finite data pertaining to a given event occurring in a business
process. The result of this process is in the form of documents or
postings, such as purchase orders and obligations.
Transaction data input:
Relates to controls over data that enter the application (e.g., data
validation and edit checks).
Transaction data output:
Relates to controls over data output and distribution (e.g., output
reconciliation and review).
Transaction data processing:
Relates to controls over data integrity within the application (e.g.,
review of transaction processing logs).
Transaction file:
A group of one or more computerized records containing current business
activity and processed with an associated master file. Transaction
files are sometimes accumulated during the day and processed in batch
production overnight or during off-peak processing periods.
Trusted communication Path:
A mechanism by which a user (through an input device) can communicate
directly with the security functions of the information system with the
necessary confidence to support the system security policy. This
mechanism can only be activated by the user or the security functions
of the information system and cannot be imitated by untrusted software.
Uninterruptible power supply (UPS):
Provides short-term backup power from batteries for a computer system
when the electrical power fails or drops to an unacceptable voltage
level.
Unit testing:
Testing individual program modules to determine if they perform to
specifications.
UNIX:
A multitasking operating system originally designed for scientific
purposes that have subsequently become a standard for midrange computer
systems with the traditional terminal/host architecture. UNIX is also a
major server operating system in the client/server environment.
Update access:
This access level includes the ability to change data or a software
program.
Upload:
The process of transferring a copy of a file from a local computer to a
remote computer by means of a modem or network.
User:
The person who uses a computer system and its application programs to
perform tasks.
User auditor:
The auditor of the user organization.
User control:
Portions of controls that are performed by people interacting with IS
controls. The effectiveness of user controls typically depend on the
accuracy of the information produced by the IS controls.
User-defined processing:
The user is allowed to establish or modify processing steps. This
frequently occurs in application based spreadsheets and report
writer/data extraction tools.
User identification (ID):
A unique identifier assigned to each authorized computer user.
User privilege:
Right to execute a particular type of Microsoft SQL server statement,
or a right to access another user�s object.
User profile:
A set of rules that describes the nature and extent of access to each
resource that is available to each user.
Utility program:
Generally considered to be system software designed to perform a
particular function (e.g., an editor or debugger) or system maintenance
(e.g., file backup and recovery).
Validation:
The process of evaluating a system or component during or at the end of
the development process to determine whether it satisfies specified
requirements.
Validity:
See Validity Control.
Validity Control:
Controls designed to provide reasonable assurance (1) that all recorded
transactions actually occurred (are real), relate to the entity, and
were properly approved in accordance with management�s authorization,
and (2) that output contains only valid data.
Virtual Private Network (VPN):
Protected IS link utilizing tunneling, security controls (see
information assurance), and end-point address translation giving the
impression of a dedicated line.
Virus:
A program that �infects� computer files, usually executable programs,
by inserting a copy of itself into the file. These copies are usually
executed when the �infected� file is loaded into memory, allowing the
virus to infect other files. Unlike the computer worm, a virus requires
human involvement (usually unwitting) to propagate.
Vulnerability:
Weakness in an information system, system security procedures, internal
controls, or implementation that could be exploited or triggered by a
threat source.
Vulnerability Assessment:
Formal description and evaluation of the vulnerabilities in an
information system.
Vulnerability scanning:
Type of network security testing that among others enumerates the
network structure and determines the set of active hosts and associated
software and verifies that software (e.g., operating system and major
applications) is up-to-date with security patches and software version.
Wide area network (WAN):
A group of computers and other devices dispersed over a wide
geographical area that is connected by communications links.
WAN:
See wide area network.
War Dialer:
Software packages that sequentially dial telephone numbers, recording
any numbers that answer.
Web application:
Is an application that is accessed via web over a network such as the
Internet or an intranet. The ability to update and maintain Web
applications without distributing and installing software on
potentially thousands of client computers is a key reason for their
popularity.
Wired Equivalent Privacy (WEP):
The Wired Equivalent Privacy (WEP) security protocol for wireless local
area networks (LANs) uses encryption to provide similar security to
that of a wired LAN. WEP is defined in the IEEE 802.11b standard.
Wi-Fi Protected Access (WPA):
The Wi-Fi Protected Access (WPA) security protocol was designed to
improve upon the security features of WEP for wireless communications.
It is defined in IEEE�s 802.11i standard.
Workstation:
A microcomputer or terminal connected to a network. Workstation can
also refer to a powerful, stand-alone computer that has considerable
calculating or graphics capability.
World Wide Web (WWW):
A sub-network of the Internet through which information is exchanged by
text, graphics, audio and video.
Worm:
An independent computer program that reproduces by copying itself from
one system to another across a network. Unlike computer viruses, worms
do not require human involvement to propagate.
[End of appendix]
Appendix XIII � Bibliography:
Committee on National Security Systems, National Information Assurance
(IA) Glossary, CNSS Instruction No. 4009 (Ft. Meade, Maryland: Revised
Draft 2005).
Information System Audit and Control Association (ISACA), Glossary of
Terms, [hyperlink, http://www.isaca.org/glossary.htm].
Office of Management and Budget, Security of Federal Automated
Resources, Circular A-130, Appendix III, (Washington, D.C.: November
2000).
Office of Management and Budget, Management Responsibility for Internal
Control, Circular A-123, Appendix A, (Washington, D.C. July 2005).
Office of Management and Budget, Designation of Senior Agency Officials
for Privacy, Memorandum M-05-08 (Washington, D.C.: February 11, 2005).
Office of Management and Budget, Safeguarding Personally Identifiable
Information, Memorandum M-0615 (Washington, D.C.: May 22, 2006).
Office of Management and Budget, Protection of Sensitive Agency
Information, Memorandum M-06-16 (Washington, D.C.: June 23, 2006).
Office of Management and Budget, Reporting Incidents Involving
Personally Identifiable Information and Incorporating the Cost for
Security in Agency Information Technology Investments, Memorandum M-06-
19 (Washington, D.C.: July 12, 2006).
Office of Management and Budget, FY 2006 Reporting Instructions for the
Federal Information Security Management Act and Agency Privacy
Management, Memorandum M-06-20 (Washington, D.C. July 17, 2006).
Office of Management and Budget, Use of Commercial Credit Monitoring
Services Blanket Purchase Agreements, Memorandum M-07-04 (Washington,
D.C.: December 22, 2006).
Office of Management and Budget, Implementation of Commonly Accepted
Security Configurations for Window Operating Systems, (Washington,
D.C.: March 22, 2007).
Office of Management and Budget, Safeguarding Against and Responding to
the Breach of Personally identifiable Information, Memorandum M-07-16
(Washington, D.C.: May 22, 2007).
U.S. Department of Commerce, National Institute of Standards and
Technology, Security Requirements for Cryptographic Modules, Federal
Information Processing Standards 140-2, (Washington, D.C.: May 2001).
U.S. Department of Commerce, National Institute of Standards and
Technology, Advance Encryption Standard (AES), Federal Information
Processing Standards 197, (Washington, D.C.: November 2001).
U.S. Department of Commerce, National Institute of Standards and
Technology, Standards for Security Categorization of Federal
Information and Information Systems, Federal Information Processing
Standards 199, (Washington, D.C.: February 2004).
U.S. Department of Commerce, National Institute of Standards and
Technology, Minimum Security Requirements for Federal Information and
Information Systems, Federal Information Processing Standards 200,
(Washington, D.C.: March 2006).
U.S. Department of Commerce, National Institute of Standards and
Technology, Personal Identity Verification (PIV) of Federal Employees
and Contractors, Federal Information Processing Standards 201,
(Washington, D.C.: March 2006).
U.S. Department of Commerce, National Institute of Standards and
Technology, Glossary of Key Information Security Terms, (Washington,
D.C.: April 2006).
U.S. Department of Commerce, National Institute of Standards and
Technology, Introduction to Computer Security, Special Publication 800-
12, (Washington, D.C.: October 1995).
U.S. Department of Commerce, National Institute of Standards and
Technology, Information Technology Security Training Requirements: A
Role-Performance-Based Model, Special Publication 800-16, (Washington,
D.C.: April 1998).
U.S. Department of Commerce, National Institute of Standards and
Technology, Guide for Developing Security Plans for Federal Information
Systems, Special Publication 800-18, (Washington, D.C.: February 2006).
U.S. Department of Commerce, National Institute of Standards and
Technology, Guideline for Implementing Cryptography in the Federal
Government, Special Publication 800-21, (Washington, D.C.): December
2005).
U.S. Department of Commerce, National Institute of Standards and
Technology, Engineering Principles for Information Technology Security,
Special Publication 800-27, (Washington, D.C.: June 2004).
U.S. Department of Commerce, National Institute of Standards and
Technology, Risk Management Guide for Information Technology Systems,
Special Publication 800-30, (Washington, D.C.: July 2002).
U.S. Department of Commerce, National Institute of Standards and
Technology, Introduction to Public Key Technology and the Federal PKI
Infrastructure, Special Publication 800-32, (Washington D.C.: February
2001).
U.S. Department of Commerce, National Institute of Standards and
Technology, Contingency Planning Guide for Information Technology
Systems, Special Publication 800-34, (Washington, D.C.: June 2002).
U.S. Department of Commerce, National Institute of Standards and
Technology, Guide to Information Technology Security Services, Special
Publication 800-35, (Washington, D.C.: October 2003).
U.S. Department of Commerce, National Institute of Standards and
Technology, Guide for Security Certification and Accreditation of
Federal Information Systems, Special Publication 800-37, (Washington,
D.C.: May 2004).
U.S. Department of Commerce, National Institute of Standards and
Technology, Creating a Patch and Vulnerability Management Program,
Special Publication 800-40, (Washington, D.C.: November 2005).
U.S. Department of Commerce, National Institute of Standards and
Technology, Guideline on Network Security, Special Publication 800-42,
(Washington, D.C.: November 2002).
U.S. Department of Commerce, National Institute of Standards and
Technology, Security for Telecommuting and Broadband Communications,
Special Publication 800-46, (Washington, D.C.: August 2002).
U.S. Department of Commerce, National Institute of Standards and
Technology, Security Guide for Interconnecting Information Technology
Systems, Special Publication 800-47, (Washington, D.C.: August 2002).
U.S. Department of Commerce, National Institute of Standards and
Technology, Building an Information Technology Security Awareness and
Training Program, Special Publication 800-50, (Washington, D.C.:
October 2003).
U.S. Department of Commerce, National Institute of Standards and
Technology, Recommended Security Controls for Federal Information,
Special Publication 800-53. (Washington, D.C.: February 2005).
U.S. Department of Commerce, National Institute of Standards and
Technology, Security Metrics Guide for Information Technology Systems,
Special Publication 800-55, (Washington, D.C.: July 2003).
U.S. Department of Commerce, National Institute of Standards and
Technology, Recommendation for Pair-Wise Key Established Schemes Using
Discrete Logarithm Cryptography, Special Publication 800-56,
(Washington, D.C.: March 2006).
U.S. Department of Commerce, National Institute of Standards and
Technology, Security Considerations for Voice over IP Systems, Special
Publication 800-58, (Washington, D.C.: January 2005).
U.S. Department of Commerce, National Institute of Standards and
Technology, Recommendation for Key Management, Special Publication 800-
57, (Washington, D.C.: August 2005).
U.S. Department of Commerce, National Institute of Standards and
Technology, Guide for Mapping Types of Information and Information
System Security Categories, Special Publication 800-60, (Washington,
D.C.: June 2004).
U.S. Department of Commerce, National Institute of Standards and
Technology, Computer Security Incident Handling Guide, Special
Publication 800-61, (Washington, D.C.: January 2004).
U.S. Department of Commerce, National Institute of Standards and
Technology, Electronic Authentication Guidelines, Special Publication
800-63, (Washington, D.C.: April 2006).
U.S. Department of Commerce, National Institute of Standards and
Technology, Security Considerations in the Information System
Development Life Cycle, Special Publication 800-64, (Washington, D.C.:
June 2004).
U.S. Department of Commerce, National Institute of Standards and
Technology, Security Configuration Checklists Program for IT Products,
Special Publication 800-70, (Washington, D.C.: May 2005).
U.S. Department of Commerce, National Institute of Standards and
Technology, Interfaces for Personal Identity Verification, Special
Publication 800-73, (Washington, D.C.: March 2006).
U.S. Department of Commerce, National Institute of Standards and
Technology, Biometric Data Specifications for Personal Identity
Verification, Special Publication 800-76, (Washington, D.C.: January
2007).
U.S. Department of Commerce, National Institute of Standards and
Technology, Cryptographic Algorithms and Key Sizes for Personal
Identity Verification, Special Publication 800-78, (Washington, D.C.:
August 2007).
U.S. Department of Commerce, National Institute of Standards and
Technology, Guide to Intrusion Detection and Prevention Systems,
Special Publication 800-94, (Washington, D.C.: February 2007).
U.S. Department of Commerce, National Institute of Standards and
Technology, Establishing Wireless Robust Security Networks, Special
Publication 800-97, (Washington, D.C.: February 2007).
U.S. Department of Commerce, National Institute of Standards and
Technology, Information Security Handbook: A Guide for Managers,
Special Publication 800-100, (Washington, D.C.: March 2007).
U.S. Department of Justice, Vulnerability Assessment of Federal
Facilities, (Washington, D.C.: June 28, 1995).
U.S. General Accounting Office, Executive Guide: Information Security
Management, Learning from Leading Organizations, [hyperlink,
http://www.gao.gov/cgi-bin/getrpt?GAO/AIMD-98-68] (Washington, D.C.:
May 1998).
U.S. General Accounting Office, Standards for Internal Control in the
Federal Government, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO/AIMD-00-01.3.1] (Washington, D.C.: November 1999).
U.S. General Accounting Office, Key Elements of a Risk Management
Approach, [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-02-150T]
(Washington, D.C.: October 2001).
U.S. General Accounting Office, Technologies to Secure Federal
Buildings, [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-02-687T]
(Washington, D.C.: April 2002).
U.S. General Accounting Office, Assessing the Reliability of Computer-
Processed Data, (Washington, D.C. October 2002).
U.S. Government Accountability Office, Federal Information System
Controls Audit Manual, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO/AIMD-12.19.6]. (Washington, D.C.: January 1999).
U.S. Government Accountability Office, Government Auditing Standards,
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-162G] (Washington,
D.C.: July 2007).
[End of appendix]
Footnotes:
[1] Information system (IS) controls consist of those internal controls
that are dependent on information systems processing and include
general controls (entitywide, system, and business process application
levels), business process application controls (input, processing,
output, master file, interface, and data management system controls),
and user controls1 (controls performed by people interacting with
information systems).
[2] GAO, Government Auditing Standards, [hyperlink,
http://www.gao.gov/cgi-bin/getrpt?GAO-07-162G] (Washington, D.C.: July
2007).
[3] GAO, Government Auditing Standards, [hyperlink,
http://www.gao.gov/cgi-bin/getrpt?GAO-07-162G] (Washington, D.C.: July
2007).
[4] The GAO/PCIE Financial Audit Manual (FAM) provides a framework for
performing IS control audits performed as part of a financial audit.
This framework is summarized in Appendix VI. The FAM is a joint effort
between GAO and the President�s Council on Integrity and Efficiency
(PCIE) to provide a methodology for performing financial audits that
meets professional standards. It can be viewed or downloaded at
[hyperlink, http://www.gao.gov/special.pubs/gaopcie/].
[5] In addition, GAO guidance, �Assessing the Reliability of Computer-
Processed Data� (Washington, DC; October 2002) can be used to assist
the auditor in determining the use of IS control audits in assessing
data reliability in a performance audit.
[6] User controls are portions of controls that are performed by people
interacting with IS controls. The effectiveness of user controls
typically depend on the accuracy of the information produced by the IS
controls.
[7] The Financial Audit Manual is a joint effort between GAO and the
President�s Council on Integrity and Efficiency (PCIE) to provide a
methodology for performing financial audits that meets professional
standards. It can be viewed or downloaded at [hyperlink,
http://www.gao.gov/special.pubs/gaopcie/].
[8] The Security Content Automation Program (SCAP) is a joint program
of the National Security Agency (NSA), Defense Information Systems
Agency (DISA), and NIST. SCAP is designed as a free, public repository
of tools to be used for automating technical control compliance
activities, vulnerability checking, and security measurement. Such
tools can provide additional criteria. See [hyperlink,
http://nvd.nist.gov/scap/scap.cfm].
[9] GAGAS paragraph 7.04 states that �the concept of significance
assists auditors throughout a performance audit, including when
deciding the type and extent of audit work to perform, when evaluating
results of audit work, and when developing the report and related
findings and conclusions. Significance is defined as the relative
importance of a matter within the context in which it is being
considered, including quantitative and qualitative factors. Such
factors include the magnitude of the matter in relation to the subject
matter of the audit, the nature and effect of the matter, the relevance
of the matter, the needs and interests of an objective third party with
knowledge of the relevant information, and the impact of the matter to
the audited program or activity. Professional judgment assists auditors
when evaluating the significance of matters within the context of the
audit objectives.�
[10] There is a section of GAGAS entitled �Information Systems
Controls� (paras. 7.23-7.27).
[11] OMB uses the terms �general support� and �application� systems to
describe the two types of entity systems. As defined in OMB Circular A-
130, a general support system is an interconnected set of information
resources under the same direct management control that share common
functionality. It normally includes hardware, software, information,
data, applications, communications, and people. The term �application�
means the use of information resources (information and information
technology) to satisfy a specific set of user requirements.
[12] A feeder system is a system that provides information or data to
support the main application. For example, in a payroll system the time
and attendance system is the feeder system for the main application.
[13] Nonrepudiation is assurance that the sender of information is
provided with proof of delivery and the recipient is provided with
proof of the sender�s identity, so neither can later deny having
processed the information. Nonrepudiation may not be necessary to
evaluate integrity to meet an audit objective.
[14] Authenticity is the property of being genuine and being able to be
verified and trusted; confidence in the validity of a transmission, a
message, or message originator. Authenticity may not be necessary to
evaluate integrity to meet an audit objective.
[15] Inherent risk is the likelihood that a loss of confidentiality,
integrity, or availability could occur that would materially/
significantly affect the audit objectives (e.g., for a financial audit,
a material misstatement), assuming that there are no related internal
controls.
[16] Standards for Internal Control in the Federal Government
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO/AIMD-00-21.3.1]
describes the five standards of internal control as: control
environment, risk assessment, control activities, information and
communications, and monitoring. The specific IS controls assessed in an
IS controls audit are part of the control activities component.
[17] These risk levels are discussed further in National Institute of
Standards and Technology, Standards for Security Categorization of
Federal Information and Information Systems, Federal Information
Processing Standards Publication (FIPS PUB) 199 (December 2003).
[18] Adverse effects on individuals may include, for example, loss of
the privacy to which individuals are entitled under law.
[19] ERP systems consist of functional modules that support business
requirements such as human resources, financials, or inventory control.
The modules can be used individually or in conjunction with other
modules as needed. The individual modules contain the business process
necessary to complete their intended function.
[20] Federal Financial Management Improvement Act of 1996, 31 U.S.C.
3512 note.
[21] Federal Managers� Financial Integrity Act of 19828 (FMFIA) 31
U.S.C. 3512 (c), (d).
[22] OMB, Management of Federal Information Resources (Washington,
D.C.: November 28, 2000).
[23] OMB, Management�s Responsibility for Internal Control (Washington,
D.C.: December 21, 2004).
[24] Health Insurance Portability and Accountability Act of 1996
(HIPAA), Pub. L. 104-191, 42 U.S.C. 1320d, et seq. (� 68 FR 8334
(2/20/03), HIPAA Security Standards and � 67 FR 53182 (Aug. 14, 2002),
HIPAA Privacy Standards.
[25] Gramm-Leach-Bliley, Pub. L. 106-102 (Nov. 12, 1999), see, e.g.,
Title V, Privacy.
[26] Requirements for information security for Medicare Administrative
Contractors, Sec. 912, Medicare Prescription Drug, Improvement, and
Modernization Act of 2003, Pub. L. 108-173 (Dec. 8, 2003), 117 Stat.
2387.
[27] Chief Privacy Officer, sec. 522, Transportation, Treasury,
Independent Agencies, and General Government Appropriations Act, 2005,
Div. H, Omnibus Appropriations Act, 2005, Pub. L. 108-447 (Dec. 8,
2004), Cong. Rec. (Nov. 19, 2004), p. H10359.
[28] OMB, Designation of Senior Agency Officials for Privacy,
(Washington, D.C.: Feb. 11, 2005).
[29] OMB, Reporting Incidents Involving Personally Identifiable
Information and Incorporating the Cost for Security in Agency
Information Technology Investments (Washington, DC: July 12, 2006).
[30] OMB, Safeguarding Against and Responding to the Breach of
Personally Identifiable Information, M 07-16 (Washington, D.C.: May 22,
2007)
[31] Intergovernmental Information security Audit Forum, Information
Systems Security Auditing: Legal and Reporting Considerations (Sept.
11, 2003) [hyperlink, http://www.nasact.org/IISAF/legal.html]
[32] Fraud is a type of illegal act involving the obtaining of
something of value through willful misrepresentation.
[33] The terms �material� and �significant� are synonymous under
generally accepted government auditing standards. In the AICPA
standards, �material� is used in relation to audits of financial
statements. �Significant� is used in relation to performance audits
performed under GAGAS.
[34] Separation of duties so that no one individual controls all
critical stages of a work process. Also see section 3.4 and the
definition in the glossary.
[35] Is a voluntary private sector organization dedicated to improving
the quality of financial reporting through business ethics, effective
internal controls, and corporate governance.
[36] The first category of business process controls is defined as
general controls operating at the business process application level.
[37] The term �more than remote� used in the definitions for
significant deficiency and material weakness means �at least reasonably
possible.� The following definitions apply: (1) Remote�The chance of
the future events occurring is slight. (2) Reasonably possible�The
chance of the future events or their occurrence is more than remote but
less than likely. (3) Probable�The future events are likely to occur.
[38] The phrase �more than inconsequential� as used in the definition
of significant deficiency describes the magnitude of potential
misstatement that could occur as a result of a significant deficiency
and serves as a threshold for evaluating whether a control deficiency
or combination of control deficiencies is a significant deficiency. A
misstatement is �inconsequential� if a reasonable person would
conclude, after considering the possibility of further undetected
misstatements, that the misstatement, either individually or when
aggregated with other misstatements, would clearly be immaterial to the
financial statements. If a reasonable person would not reach such a
conclusion regarding a particular misstatement, that misstatement is
more than inconsequential.
[39] Intergovernmental Information Security Audit Forum (Sept. 11,
2003); see [hyperlink, http://www.nasact.org].
[40] The U.S. Government Standard General Ledger (SGL) provides a
uniform chart of accounts and pro forma transactions used to
standardize federal agencies� financial information accumulation and
processing throughout the year, enhance financial control, and support
budget and external reporting, including financial statement
preparation.
[41] Editing in this context is inspecting a data field or element to
verify the accuracy of its content.
[42] NIST, An Introduction to Computer Security: The NIST Handbook,
Special Publication (SP) 800-12, October 1995.
[43] GAO, Executive Guide: Information security Management, Learning
from Leading Organizations, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO/AIMD-98-68] (Washington, D.C.: May 1998).
[44] Executive Guide: Information Security Management, Learning from
Leading Organizations [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO/AIMD-98-68], May 1998.
[45] Personally identifiable information refers to any information
about an individual maintained by an agency, including any information
that can be used to distinguish or trace an individual�s identity, such
as their name, social security number, date and place of birth, or
biometric records, and any other information which is linked or
linkable to an individual.
[46] The act describes a �record� as any item, collection, or grouping
of information about an individual that is maintained by an agency and
contains his or her name or another personal identifier. It also
identifies �system of records� as a group of records under the control
of any agency retrieved by the name of the individual or by an
individual identifier.
[47] A system of records notice is a notice in the Federal Register
identifying, among other things, the type of data collected, the types
of individuals about whom information is collected, the intended
�routine� uses of data, and procedures that individuals can use to
review and correct personal information.
[48] According to FY 2006 Reporting Instructions for the Federal
Information Security Management Act and Agency Privacy Management, OMB
Memorandum M-06-20, July 17, 2006, a privacy impact assessment or a
system of records notice is current if that document satisfies the
applicable requirements and subsequent substantial changes have not
been made to the system.
[49] NIST Special Publication (SP) 800-60, Volume I: Guide for Mapping
Types of Information and Information Systems to Security Categories
(June 2004).
[50] Standards for Internal Control in the Federal Government (GAO/AIMD-
00-21.3.1; November 1999).
[51] OMB�s Circular A-130 requires that agencies review security
controls and re-authorize system usage (i.e., certification and
accreditation) at least every three years or more frequently if changes
occur.
[52] Assessments performed relying on reviews of system documentation
such as hardware and software security settings and use of software
features that are inherent to the application under review.
[53] Network �sniffers� (software that can intercept and log traffic
passing over a network) can identify the transmission of passwords or
sensitive information in clear text.
[54] SNMP (Simple Network Management Protocol) provides remote
administration of network devices.
[55] Office of Management and Budget, Management�s Responsibility for
Internal Control, OMB Circular No. A-123 (Washington, D.C.: December
2004).
[56] The FAR was established to codify uniform policies for acquisition
of supplies and services by executive agencies. The FAR appears in the
Code of Federal Regulations at 48 CFR Chapter 1.
[57] As used herein, users include those given any level of authorized
access to computer resources, including business process application
users, system administrators, etc.
[58] A computer program designed to help perform a business function
such as payroll, inventory control, accounting, and mission support.
Depending on the work for which it was designed, an application can
manipulate text, numbers, graphics, or a combination of these elements.
[59] Steganography is a technique that hides the existence of a message
(for example, by embedding it within another message) and may be used
where encryption is not permitted or to hide information in an
encrypted file in case the encrypted file is deciphered. Other uses
include digital watermarking and fingerprinting of audio and video
files.
[60] Infrastructure applications include databases, e-mail, browsers,
plug-ins, utilities, and other applications.
[61] OMB, Protection of Sensitive Agency Information (Washington, D.C.:
June 23, 2006).
[62] The optional cryptographic confidentiality algorithm specified by
IEEE 802.11 used to provide data confidentiality that is subjectively
equivalent to the confidentiality of a wired local area network (LAN)
medium that does not employ cryptographic techniques to enhance
confidentiality.
[63] Access privileges granted to a user, program, or process.
[64] The term �super user� denotes the highest level of user privilege
and can allow unlimited access to a system's file and set up.
[65] OMB Memorandum M-04-26, Personal Use Policies and �File Sharing�
Technology, (Washington, D.C.: September 8, 2004).
[66] Identity-based access is based on the identities of users and
information system resources. Role-based access is based on users'
roles/responsibilities. Rule-based access is based on user or resource
attributes and a predetermined rule set.
[67] See NIST Special Publications (SP) 800-10 and 800-41 for
information on configuring firewalls and filtering common protocols to
minimize vulnerabilities from Internet services. SP 800-10, from 1994,
contains basic information that is still applicable, but SP 800-41
updates the earlier document and covers Internet protocol packet
filtering and more recent policy recommendations.
[68] Mobile code is a software program or parts of programs obtained
from remote information systems, transmitted across a network, and
executed on a local information system without explicit installation or
execution by the recipient. Examples of mobile code include scripts
(JavaScript, VBScript), Java applets, Active X controls, and macros
embedded within Office documents.
[69] The process of removing sensitive information from computer media
is often referred to as sanitization. It includes removing all labels,
markings, and activity logs. NIST SP 800-36 provides guidance on
appropriate sanitization equipment, techniques, and procedures.
[70] The checklists and configuration guides at [hyperlink,
http://csrc.nist.gov/pcig/cig.html] provide recommended lists of
auditable events.
[71] Department of Justice, Vulnerability Assessment of Federal
Facilities, (Washington, D.C.: June 28, 1995).
[72] Critical Infrastructure Identification, Prioritization, and
Protection (Washington, D.C.: December 17, 2003).
[73] Also see Homeland Security Presidential Directive 12, Policy for a
Common Identification Standard for Federal Employees and Contractors,
(Washington, D.C.: August 27, 2004); and NIST Federal Information
Processing Standard Publication (FIPS PUB) 201-1, Personal Identity
Verification (PIV) of Federal Employees and Contractors, (Washington,
D.C.: March 2006).
[74] See, for example, IEEE Standard 1200-1998, SEI CMMI (ver. 1.1),
NIST SP 800-64, and Military Handbook 61A(SE).
[75] A Systems Development Life Cycle (SDLC) methodology consists of
the policies and procedures that govern software development and
modification as a software product goes through each phase of its life
cycle.
[76] Based on IEEE Standard for Software Configuration Management Plans
(IEEE Std. 828-1998), the Institute of Electrical and Electronic
Engineers, June 25, 1998.
[77] OMB, Implementation of Commonly Accepted Security Configurations
for Windows Operating Systems (Washington, D.C.: March 22, 2007).
[78] A configuration control board evaluates and approves or
disapproves proposed changes to configuration items and ensures
implementation of approved changes.
[79] Patch management is the process of applying software patches to
correct flaws. A patch is a piece of software code that is inserted
into a program to temporarily fix a defect. Patches are developed and
released by software vendors when vulnerabilities are discovered.
[80] Title X, Subtitle G�Government Information Security Reform, Floyd
D. Spence National Defense Authorization Act for Fiscal Year 2001, P.L.
106-398, October 30, 2000.
[81] Worms propagate through networks; viruses destroy files and
replicate by manipulating files.
[82] Phishing is tricking individuals into disclosing sensitive
personal information through deceptive computer-based means.
[83] Spyware is software that is secretly or surreptitiously installed
into an information system to gather information on individuals or
organizations without their knowledge; a type of malicious code.
[84] Malware (malicious software) is defined as programs that are
designed to carry out annoying or harmful actions. They often
masquerade as useful programs or are embedded into useful programs so
that users are induced into activating them. Malware can include
viruses, worms, and spyware (GAO-05-231).
[85] Botnets are compromised computers that can be remotely controlled
by attackers to automatically launch attacks. Bots (short for robots)
have become a key automation tool to speed the infection of vulnerable
systems [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-05-231].
[86] NIST, An Introduction to Computer Security: The NIST Handbook,
Special Publication (SP) 800-12, October 1995.
[87] NIST, Contingency Planning Guide for Information Technology
Systems, Special Publication (SP) 800-34, June 2002.
[88] Observations of Agency Computer Security Practices and
Implementation of OMB Bulletin No.90-08: Guidance for Preparation of
Security Plans for Federal Computer Systems that Contain Sensitive
Information, February 1993. OMB Bulletin 90-08 was superseded by NIST
Special Publication (SP) 800-18, dated December 1998, Guide for
Developing Security Plans for Information Technology Systems. [OMB
Circular A-130, Appendix III, directs NIST to update and expand
security planning guidance.]
[89] An enterprise resource planning (ERP) system is a commercial
software package that integrates all the information flowing through
the entity. ERP systems contain functional modules (e.g., financial,
accounting, human resources, and supply chain and customer information)
that are integrated within the core system or interfaced to external
systems.
[90] In addition, agency-specific requirements should be addressed.
[91] See GAO, Information Security: Improving Oversight of Access to
Federal Systems and Data by Contractors Can Reduce Risk, (Washington,
D.C.: April 2005).
[92] In addition, this Circular requires and the NIST guide recommends
a plan for general support systems.
[93] NIST defines Business Impact Analysis (BIA) as follows: An
analysis of an information technology (IT) system�s requirements,
processes, and interdependencies used to characterize system
contingency requirements and priorities in the event of a significant
disruption.
[94] Special Publication 800-12, An Introduction to Computer Security:
The NIST Handbook.
[95] Data standards are designed to enable systems to easily
interoperate and transfer information. Standard definitions for data
elements are intended to ensure that users of all entity systems define
the same data in the same way and have a common understanding of their
meaning.
[96] In contrast, system interconnections refer to the direct
connection of two or more IT systems for the purpose of sharing data
and other information resources.
[97] Government Auditing Standards: July 2007 Revision [hyperlink,
http://www.gao.gov/cgi-bin/getrpt?GAO-07-731G], paragraph 3.43.
[98] The IS control specialist is a person with technical expertise in
information technology systems, general controls, business process
applications and controls, and information security.
[99] The single audit is intended to provide a cost-effective audit for
nonfederal entities in that one audit is conducted in lieu of multiple
audits of individual programs. Such audits are performed in accordance
with the Single Audit Act Amendments of 1996 and OMB Circular A-133
(Audits of States, Local Governments, and Non-Profit Organizations) to
determine whether federal funds to nonfederal entities are expended
properly.
[100] User controls are portions of controls that are performed by
people interacting with IS controls. The effectiveness of user controls
typically depend on the accuracy of the information produced by the IS
controls.
[101] The definitions currently in Circular A-133, based on superseded
GAGAS, are as follows: Reportable conditions involve matters coming to
the auditor�s attention relating to significant deficiencies in the
design or operation of the internal control over compliance that, in
the auditor�s judgment, could adversely affect the entity�s ability to
administer a major federal program in accordance with the applicable
requirements of laws, regulations, contracts, and grants. A material
weakness is a reportable condition in which the design or operation of
one or more of the internal control components does not reduce to a
relatively low level the risk that noncompliance with the applicable
requirements of laws, regulations, contracts, and grants caused by
error or fraud that would be material in relation to a major federal
program being audited may occur and not be detected within a timely
period by employees in the normal course of performing their assigned
functions.
[102] Standards for Internal Control in the Federal Government
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO/AIMD-00-21.3.1],
November 1999.
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