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Hi,
In page 2 of the article, we look at when can internal auditors be used to provide direct assistance and under Step 1 is Prohibition by law or regulation. Under this, it talks about first task being to understand the law or regulation of the jurisdiction in which the auditor is operating. It then says:
“in UK for example, FRC prohibits ext auditors from using internal auditors as ‘direct assistance’ members of the audit team in order to enhance the principle of auditor independence.”
What does this mean? Why does it not just say it is prohibited in UK under ISAs (UK and Ireland) if that’s what it means rather than all this wording. If it doesn’t mean its prohibited, then what does it mean? I hope I make sense.
Thanks for you help
BegumIt means that the external auditor cannot use the internal audit team to provide direct assistance.
In practice, it is safe to say that, although we may use the services of the internal audit team to assist in the collection of evidence, there is no material area of the financial statements where we are able to rely 100% on the work of the internal auditor – even though their integrity and thoroughness is not in question. The reason? It’s OUR opinion that is being expressed on the truth and fairness of the view shown by the financial statements.
You maybe forget that there is a World beyond UK and Ireland and that these articles are written for the Global community of accountancy students
And I’ve just read again the “offending paragraph” that contains “all this wording.”(quote from your post) I’m sorry but I don’t find there to be an excessive use of words there
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