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