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Hello dear tutor…
I hope that you are well…
It is necessary for auditors to do these before place reliance on expert’s works:
1-assess his objectivity and independence(eg:by considering the reasonableness of fee paid to him-the more independent person,the more reliable work)
2-assess his competence and qualification( more competent person means more reliable work)
3-agree scope of work at start(any deviation from this agreed plan will reduce the reliability of his job)
4-evaluate the relevance and adequacy of his work( reasonableness of assumptions used, reliability of sources of data ,…)Now this is my question:
Q1:should we(as external auditor) evaluate the same things before reliance on internal auditor?(or we should consider other factors)Q2:should we(as group’s principal auditor) evaluate the same things before reliance on component auditors?(or we should consider other factors)
Thank you in advance
‘1-assess his objectivity and independence’
Yes
‘2-assess his competence and qualification’
Yes
‘3-agree scope of work at start’
Yes
‘4-evaluate the relevance and adequacy of his work’
Yes
‘Q1:should we(as external auditor) evaluate the same things before reliance on internal auditor?’
Yes
‘(or we should consider other factors)’
The above 4 points pretty much cover what you should be looking for
‘Q2:should we(as group’s principal auditor) evaluate the same things before reliance on component auditors?’
Yes
‘(or we should consider other factors)’
The above 4 points pretty much cover what you should be looking for
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