Using the Work of Internal Audit (1)

Question 1

What can auditor rely upon?

Answer 1

The audit of inventory is the internal audit function at a client

Question 2

What happens during the course of their planning?

Answer 2

External auditors should perform an assessment of the internal audit function if they consider it may be possible to rely on internal audit’s work

Question 3

What may be reduced?

Answer 3

Volume of detailed work undertaken by the external auditor

Question 4

What is internal audit function? (assurance effectiveness)

Answer 4

A function of an entity that performs assurance and consulting activities designed to evaluate and improve effectiveness of entity’s governance, risk management and internal control processes

Question 5

What does ISA 610 provide guidance?

Answer 5

For external auditor when external auditor expects to use the work of internal audit function to modify nature or timing, or reduce the extent, of audit procedures to be performed directly by the external auditor

Question 6

What work of internal audit used for?

Answer 6

Purposes of the external audit

Question 7

What can external auditor not make reference to

Answer 7

Work done by internal auditor in their auditor’s report

Question 8

What is important to note?

Answer 8

External auditor has sole responsibility for audit opinion expressed on the financial statements