Using the Work of Internal Auditors

CAS 610

Using the Work of Internal Auditors

CAS 610

Determining Whether and to What Extent to Use the Work of the Internal Auditors
  • The external auditor should determine:
    • If the work of the internal auditors is likely to be adequate for purposes of the audit; and
    • If so, the planned effect of the work of the internal auditors on the nature, timing or extent of the external auditor’s procedures
  • In determining whether the work of the internal auditors is likely to be adequate for purposes of the audit, evaluate:
    • The objectivity of the internal audit function
    • The technical competence of the internal auditors
    • If the work of the internal auditors is likely to be carried out with due professional care
    • If there is likely to be effective communication between the internal auditors and the external auditor
  • In determining the effect of the work of the internal auditors on the external auditor’s procedures, consider:
    • The nature and scope of specific work performed by the internal auditors
    • The assessed risks of material misstatement at the assertion level for particular classes of transactions, account balances, and disclosures
    • The degree of subjectivity involved in the evaluation of the audit evidence gathered by the internal auditors in support of the relevant assertions
Using Specific Work of the Internal Auditors
  • To determine the adequacy of specific work performed by the internal auditors, the external auditor should evaluate whether:
    • The work was performed by internal auditors having adequate technical training and proficiency
    • The work was properly supervised, reviewed and documented
    • Adequate audit evidence has been obtained to enable the internal auditors to draw reasonable conclusions
    • Conclusions reached are appropriate and reports prepared by the internal auditors are consistent with the results of the work performed
    • Any exceptions or unusual matters disclosed by the internal auditors are properly resolved

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