1. IT Security Auditing
Martin Goldberg

2. Today’s Topics Defining IT Audit and the Auditor Steps of an IT Audit
Preparing to be Audited
How IT Audit Applications

3. Defining IT Security Audit
Financial Audit
IRS
Physical Audit
Inventory

4. Defining IT Security Audit (cont.)
IT Audit
Independent review and examination of records and activities to assess the adequacy of system controls, to ensure compliance with established policies and operational procedures, and to recommend changes in controls, policies, or procedures - DL 1.1.9
Good Amount of Vagueness
Ultimately defined by where you work
This is an audit of how the confidentiatlity, integrity and availablility of an organizations information assets is assured. The point of doing it is to catch problems before an incident occurs and exposes the problem to the world at large.
Base on where you work the phrase pen test and IT Security Audit may be used interchangalby. However a pen test is a very narrowly foucused attempt to look for security holes in a critical resource, such as a firewall or webserver. With little or no information on your intended target.
On the other hand and IT Audit is broader range assesment. For example when pen testing a web server you are looking for vulnerabilities in the service and/or underlying system. An IT Security audit you want to know, how has access to this machine, who is allowed to make changes, are there any change logs being kept, how accurate, etc. There is also a full disclosure of the information.

5. Who is an IT Auditor Accountant Raised to a CS Major
CPA, CISA, CISM, Networking, Hardware, Software, Information Assurance, Cryptography
Some one who knows everything an accountant does plus everything a BS/MS does about CS and Computer Security - Not likely to exist
IT Audits Are Done in Teams
Accountant + Computer Geek = IT Audit Team
Scope to large
Needed expertise varies

6. CISA? CISM? CISA - Certified Information Systems Auditor
CISM - Certified Information Systems Mangager - new
(Information Systems Audit and Control Organization)
Teaching financial auditors to talk to CS people
What are these and why should you take them seriously?
ISACA is an international organization

7. CISA
Min. of 5 years of IS auditing, control or security work experience
Code of professional ethics
Adhering to IS auditing standards
Exam topics:
1. Management, Planning, and Organization of IS
2. Technical Infrastructure and Operational Practices
3. Protection of Information Assets
Evaluate the strategy, policies, standards, procedures and related practices for the management, planning, and organization of IS.
Policies governing you IS department compared to best practices
Evaluate the effectiveness and efficiency of the organization's implementation and ongoing management of technical and operational infrastructure to ensure that they adequately support the organization's business objectives.
Right equipment of the job
3. Evaluate the logical, environmental, and IT infrastructure security to ensure that it satisfies the organization's business requirements for safeguarding information assets against unauthorized use, disclosure, modification, damage, or loss.
Really in depth IT Security Area. Checking for things like password usage, encryption, etc.

8. CISA (cont.) Exam topics: (cont.)
4. Disaster Recovery and Business Continuity
5. Business Application System Development, Acquisition, Implementation, and Maintenance
6. Business Process Evaluation and Risk Management
7. The IS Audit Process
4. Evaluate the process for developing and maintaining documented, communicated, and tested plans for continuity of business operations and IS processing in the event of a disruption.
Audting of Disaster Recovery Plans
5. Evaluate the methodology and processes by which the business application system development, acquisition, implementation, and maintenance are undertaken to ensure that they meet the organization's business objectives.
This area covers Application auditing which I will discuss more
6. Evaluate business systems and processes to ensure that risks are managed in accordance with the organization's business objectives.
Auditing risk management procedures and policies
7. Conduct IS audits in accordance with generally accepted IS audit standards and guidelines to ensure that the organization's information technology and business systems are adequately controlled, monitored, and assessed.
Following best practices

9. CISM Next step above CISA Exam topics:
1. Information Security Governance
2. Risk Management
3. Information Security Program Management
4. Information Security Management
5. Response Management
Establish and maintain a framework to provide assurance that information security strategies are aligned with business objectives and consistent with applicable laws and regulations
Higher level view of an organizations IT policies and procedures to make sure they are both useful to the organization on are in complience with laws and regulations that may apply
2.Identify and manage information security risks to achieve business objectives
CISA you were looking at risk management from the point of view of one entity within the corporation, here you are examining how a failure in that entity affect the entire organization
3.Design, develop and manage an information security program to implement the information security governance framework
For the most part when you are auditng you are a casual observer and make your suggestions at the end. When it comes to the management level your input is expected when developing organizational wide policies and procedures.
4. Oversee and direct information security activities to execute the information security program
Again you are expected to take a more proactive role
5. Develop and manage a capability to respond to and recover from disruptive and destructive information security events
Same as the last 3

10. Steps of An IT Audit 1. Planning Phase 2. Testing Phase
3. Reporting Phase
General approach to IT Auditing, remember IT Security Auditing is a large subset of IT Auditing
Ideally it’s a continuous cycle
Again not always the case

11. Planning Phase Entry Meeting Define Scope Learn Controls
Historical Incidents
Past Audits
Site Survey
Review Current Policies
Questionnaires
Define Objectives
Develop Audit Plan / Checklist
Controls are management controls, authentication/access controls, physical security, outsider access to systems, system administration controls and procedures, connections to external networks, remote access, incident response, contingency plan.

12. Defining Objectives & Data Collection
Some Points to Keep in Mind
OTS (Department of Treasury - Office of Thrift Savings) - Banking Regulations
SEC (Securities and Exchange Commission) - Mutual Funds
HIPPA - Health Care
Sarbanes Oxley - Financial Reports, Document Retention
Gramm-Leach Bliley - Consumer Financial Information
FERPA (Family Education Rights and Privacy Act) - Student Records
Clearence

13. Example Checklist
“An Auditor’s Checklist for Performing a Perimeter Audit of on IBM ISERIES (AS/400) System” - Craig Reise
Scope of the audit does not include the Operating System
Physical security
Services running
Example of defining objectives and scope

14. Testing Phase Meet With Site Managers What data will be collected
How/when will it be collected
Site employee involvement
Answer questions

15. Testing Phase (cont.) Data Collection Types of Data
Based on scope/objectives
Types of Data
Physical security
Interview staff
Vulnerability assessments
Access Control assessments

16. Reporting Phase Exit Meeting - Short Report Immediate problems
Questions & answer for site managers
Preliminary findings
NOT able to give in depth information

17. Reporting Phase (cont.)
Long Report After Going Through Data
Intro defining objectives/scope
How data was collected
Summary of problems
Table format
Historical data (if available)
Ratings
Fixes
Page # where in depth description is

18. Reporting Phase (cont.)
In depth description of problem
How problem was discovered
Fix (In detail)
Industry standards (if available)
Glossary of terms
References
Note: The Above Varies Depending on Where You Work

19. Preparing To Be Audited
This Is NOT a Confrontation
Make Your Self Available
Know What The Scope/Objectives Are
Know What Type of Data Will be Collected
Know What Data Shouldn’t be Collected
Generally specific records shouldn’t be needed instead an agregaion

20. Example - Auditing User & Groups
Very simple, this is an example of a real life example taken form the MTA just really dumbed down. Original one included close to 1,000 users 125 groups.
Being in 2 groups is ok, all 3 is a violation. Ideally, 1 person in group.
When clearence or guarded information is involved it puts a heavier burden on the site employees

21. Application Audit
An assessment Whose Scope Focuses on a Narrow but Business Critical Processes or Application
Excel spreadsheet with embedded macros used to analyze data
Payroll process that may span across several different servers, databases, operating systems, applications, etc.
The level of controls is dependent on the degree of risk involved in the incorrect or unauthorized processing of data

22. Application Audit (cont.)
1. Administration
2. Inputs, Processing, Outputs
3. Logical Security
4. Disaster Recovery Plan
5. Change Management
6. User Support
7. Third Party Services
8 . General Controls
An Application Audit, should, at a minimum determine the existence of controls in these areas
1 to 7 are more important
While 8 is a bit outside of the scope

23. Application Audit - Administration
Probably the most important area of the audit, because this area focuses on the overall ownership and accountability of the application
Roles & Responsibilities - development, change approval, access authorization
Legal or regulatory compliance issues
Roles & Responsibilities should be segregated. What compliance do you need to follow

24. Application Audit - Inputs, Processing, Outputs
Looking for evidence of data preparation procedures, reconciliation processes, handling requirements, etc.
Run test transactions against the application
Includes who can enter input and see output
Retention of output and its destruction

25. Application Audit - Logical Security
Looking at user creation and authorization as governed by the application its self
User ID linked to a real person
Number of allowable unsuccessful log-on attempts
Minimum password length
Password expiration
Password Re-use ability

26. Application Audit - Disaster Recovery Plan
Looking for an adequate and performable disaster recovery plan that will allow the application to be recovered in a reasonable amount of time after a disaster
Backup guidelines, process documentation, offsite storage guidelines, SLA’s with offsite storage vendors, etc.
Service level agreement

27. Application Audit - Change Management
Examines the process changes to an application go through
Process is documented, adequate and followed
Who is allowed to make a request a change, approve a change and make the change
Change is tested and doesn’t break compliance (determined in Administration) before being placed in to production

28. Application Audit - User Support
One of the most overlooked aspects of an application
User documentation (manuals, online help, etc.) - available & up to date
User training - productivity, proper use, security
Process for user improvement requests

29. Application Audit - Third Party Services
Look at the controls around any 3rd party services that are required to meet business objectives for the application or system
Liaison to 3rd party vendor
Review contract agreement
SAS (Statement on Auditing Standards) N Service organizations disclose their control activities and processes to their customers and their customers’ auditors in a uniform reporting format

30. Application Audit - General Controls
Examining the environment the application exists within that affect the application
System administration / operations
Organizational logical security
Physical security
Organizational disaster recovery plans
Organizational change control process
License control processes
Virus control procedures
Application doesn’t exist within a bubble. Not doing in depth audit on these points

31. References www.isaca.org
“An Auditor’s Checklist for Performing a Perimeter Audit of on IBM ISERIES (AS/400) System” - Craig Reise
“Conducting a Security Audit: An Introductory Overview” - Bill Hayes
“The Application Audit Process - A Guide for Information Security Professionals” - Robert Hein