Advanced Auditing, Assurance and Professional Ethics · Group Audits

Procedures When Using Other Auditor's Work (SA 600)

Updated 5 October 2026 · Fact-checked

When a principal auditor uses another auditor's work on a component, SA 600 expects the principal auditor to assess the other auditor's professional competence, tell them what is needed, and review their work. The procedures depend on the component's significance and risk. You then judge whether the work is enough for your opinion.

Understand Procedures When Using Other Auditor's Work

In a group audit, one auditor signs the report on the financial statements of the whole entity. This is the principal auditor. Some parts, such as a branch, a subsidiary or a division, are audited by a different auditor. This is the other auditor. The principal auditor still has to form an opinion on the whole financial statements, so the other auditor's work has to be reliable.

That is why SA 600 asks for procedures. The principal auditor cannot simply accept the other auditor's report. First, you must be satisfied that the other auditor is competent and can be relied on. Second, you must make sure the other auditor knows what you need from them. Third, you must look at their work to see whether it is enough for your purpose.

The extent of these procedures is a matter of judgment. It depends on how material the component is, how risky it is, and what you already know about the other auditor. A large, high-risk component needs more work than a small, low-risk one. A well-known firm of the same network, working under the same quality control, needs less inquiry than an unknown firm.

The principal auditor also decides how far to rely. If the other auditor's work is not sufficient, you may do extra procedures yourself or ask the other auditor to do more. If you still cannot obtain sufficient appropriate evidence, this is a limitation of scope. It leads to a qualified opinion or a disclaimer of opinion, depending on the materiality and pervasiveness of the possible effects.

Be careful on responsibility. If the principal auditor does not refer to the other auditor in the report, the full responsibility for the opinion stays with the principal auditor. If the report refers to the other auditor's work, the reference indicates a division of responsibility in the report, under SA 600 as adopted in India. Such a reference is not a qualification.

For a company with a branch office, the Companies Act, 2013 also matters. Section 143(8) allows the accounts of the branch to be audited by a person other than the company's auditor. Under Section 143(3)(c), the company's auditor reports whether the report on the branch accounts has been sent to them and how they dealt with it in preparing the audit report. This applies to branch audits only. For a subsidiary, the principal auditor's use of the component auditor's report is governed by SA 600 and the consolidation provisions. Document your reliance on the other auditor's work and how you dealt with their report.

As a suggested answer structure in the exam, write the procedures in the order of the engagement: assess, communicate, review, conclude.

Key rules to remember

Competence assessment: Professional competence + independence + working relationship → basis for reliance; Use this as a memory frame. Inquire about the other auditor's professional qualifications, experience, independence and, where relevant, the quality control environment they work in.
Extent of procedures: Extent of procedures depends on: materiality of component + risk of material misstatement + knowledge of the other auditor; The principal auditor uses judgment. There is no fixed number of procedures.
Coordination: Principal auditor informs → other auditor confirms: requirements, ethics, reporting, timing; Communicate in writing where practical, so the other auditor knows what work is expected of them.
Review of work: Review of other auditor's audit procedures, findings and conclusions → sufficiency decision; If the work is not sufficient, perform additional procedures, or ask the other auditor to do so. If still not sufficient, it is a scope limitation: qualified opinion or disclaimer, depending on materiality and pervasiveness.
Responsibility rule: No reference to the other auditor in the report → full responsibility stays with the principal auditor; reference to the other auditor's work → division of responsibility indicated in the report, not a qualification; Under SA 600 as adopted in India, if the principal auditor does not refer to the other auditor, the full responsibility for the opinion stays with the principal auditor. If the report refers to the other auditor's work, the reference indicates a division of responsibility. It is not to be read as a qualification. Check the reporting provisions in the related SA 600 topics.

How to solve Procedures When Using Other Auditor's Work questions

Use this order for any question on the principal auditor's procedures. It keeps your answer in provision-facts-conclusion form.

1Identify the roles: who is the principal auditor, who is the other auditor, and what is the component (branch, subsidiary, division).
2Judge the component's significance and risk from the facts: size, share of the group, nature of the business, any known problems.
3Assess the other auditor's professional competence: qualifications, experience, independence, reputation, and any prior work with them.
4State the coordination steps: inform the other auditor of the requirements, the ethical rules, the form of reporting and the timeline.
5State the review steps: look at the other auditor's findings, working papers where necessary, and conclusions, and discuss significant matters with them.
6Decide whether the work is sufficient. If not, say what extra procedures are needed. If sufficient appropriate evidence still cannot be obtained, say it is a scope limitation leading to a qualified opinion or disclaimer, depending on materiality and pervasiveness.
7Conclude clearly with the principal auditor's responsibility and the effect on the audit opinion, linked to the facts of the case.

Quickest way: Assess, Tell, Review, Decide

When to use it: Use this when you have little time, for MCQs or for a short descriptive part of a case where the question asks what the principal auditor should do.

Assess: competence and independence of the other auditor.
Tell: communicate what is needed, including ethics and reporting.
Review: examine the work and discuss significant findings.
Decide: is the work sufficient? If not, do more. If evidence is still not enough, it is a scope limitation: qualified opinion or disclaimer, by materiality and pervasiveness.
Add one line on responsibility: if the report does not refer to the other auditor, full responsibility stays with the principal auditor; if it refers to the other auditor's work, the reference indicates a division of responsibility and is not a qualification.

Common mistakes in Procedures When Using Other Auditor's Work

Treating the other auditor's report as final without any review.
Students assume that a signed report from a qualified auditor is proof enough.
Fix: State that the principal auditor must assess competence and review the work. The extent depends on significance and risk, but some procedures are always needed.
Applying the same procedures to every component.
Students memorise a list and write it out the same way every time.
Fix: Link the extent of procedures to the component's materiality and risk. Say that a small, low-risk component needs less than a large, high-risk one.
Confusing competence with independence.
Both appear in the assessment and are often mixed in one sentence.
Fix: Treat them separately: competence is about skills, qualification and experience; independence is about ethical requirements relevant to the group audit.
Treating a reference to the other auditor in the report as a qualification, or missing the division of responsibility it indicates.
Students think any mention of another auditor weakens the opinion, or they mix up the idea of relying with the idea of dividing work in the report.
Fix: Write that if the report does not refer to the other auditor, full responsibility stays with the principal auditor. If the report refers to the other auditor's work, the reference indicates a division of responsibility under SA 600 as adopted in India, and it is not a qualification.
Writing only the rule and not applying it to the case facts.
Students are used to theory-only answers.
Fix: Quote the facts of the scenario (size of the component, firm's reputation, timing) and tie each procedure to them.
Stopping at the review without a conclusion on sufficiency.
Students think listing the procedures finishes the answer.
Fix: End with a decision: the work is sufficient, additional procedures are needed, or the report is affected.

Worked examples

Example 1

Alpha & Co. is the statutory auditor of Zenith Ltd. A branch contributes about 35% of total revenue and is audited by Beta & Associates, a firm Alpha has never worked with. The branch deals with complex contracts. What should Alpha do before relying on Beta's work?

Show the solution

Provision: the principal auditor must assess the other auditor's professional competence and coordinate and review their work. The extent depends on significance and risk.
Facts: the branch is material (about 35% of revenue), the contracts are complex, and Alpha has no past experience with Beta. So the extent of procedures should be high.
Competence: Alpha should inquire about Beta's qualifications, experience, reputation and independence and, where relevant, the quality control environment Beta works in. Alpha should also obtain information from Beta's professional body or from other sources where useful.
Coordination: Alpha should tell Beta what work is required, the ethical requirements, the form and timing of reporting, and the areas of risk in the branch contracts.
Review: Alpha should review Beta's audit findings and conclusions, discuss significant matters with Beta, and where necessary look at Beta's working papers on the contract revenue.
Legal basis and documentation: the unit is a branch office of Zenith Ltd, so Section 143(8) of the Companies Act, 2013 applies where Beta audits it as a person other than the company's auditor. Under Section 143(3)(c), Alpha reports whether Beta's report on the branch accounts has been sent to it and how it dealt with that report in preparing its own report. Alpha should document its reliance on Beta and how it dealt with Beta's report.
Conclusion: if the work is not sufficient, Alpha should perform additional procedures or ask Beta to do so. If sufficient appropriate evidence is still not available, this is a limitation of scope. Alpha must modify its report with a qualified opinion or a disclaimer of opinion, depending on materiality and pervasiveness. If Alpha does not refer to Beta in its report, the full responsibility for its opinion on the whole financial statements stays with Alpha.

Answer: Alpha should assess Beta's competence and independence, communicate its requirements and risks, and review Beta's work in depth because the branch is material and risky and Beta is unknown. It should deal with Beta's branch report as Section 143(3)(c) requires and document its reliance. It then decides on sufficiency and, if needed, does more work. If evidence is still insufficient, it issues a qualified opinion or disclaimer, depending on materiality and pervasiveness.

Example 2

Sigma & Co. is the principal auditor of a group. A subsidiary that is less than 2% of group assets is audited by a firm from Sigma's own network, which has worked with Sigma for years with no issues. A partner says Sigma can skip all procedures. Is this correct?

Show the solution

Provision: the extent of the principal auditor's procedures depends on significance, risk and knowledge of the other auditor. It is a matter of judgment.
Facts: the subsidiary is small (under 2% of assets), likely low risk, and the other auditor is known to Sigma with a good record.
Application: these facts allow Sigma to carry out limited procedures. Sigma can rely on its past experience for competence, confirm independence, and do a light coordination and review.
Limit: skipping all procedures is not appropriate. Sigma should still communicate its requirements, confirm that the work was done, and make sure no significant matters have been missed.
Conclusion: the partner is not correct that all procedures can be skipped, but the extent can be reduced.

Answer: No. Sigma can reduce the extent of its procedures because the component is small, low risk and audited by a known firm. It cannot skip them entirely and still has to coordinate, review at a limited level and conclude on sufficiency.

Exam tips

Use the sequence assess, coordinate, review, conclude as a suggested answer structure. It keeps your answer in order and easy to follow.
In a case, always tie the extent of procedures to the component's size and risk, and to your knowledge of the other auditor.
For MCQs, watch for options that say the principal auditor has no responsibility or that procedures are not needed. These overstate the rule.
Keep competence and independence as separate points. It makes your answer clearer.
Finish with the effect on the report when evidence is not sufficient: a scope limitation leads to a qualified opinion or disclaimer, depending on materiality and pervasiveness. This links the topic to the reporting chapter.

Practice questions from Group Audits

Procedures When Using Other Auditor's Work in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

ACCA Applied SkillsUsing the Work of Internal Auditors

Procedures When Using Other Auditor's Work: frequently asked questions

What are the main procedures of the principal auditor under SA 600?

The principal auditor assesses the other auditor's professional competence, communicates the requirements, and reviews the work. The extent depends on the component's significance and risk. The principal auditor then decides if the work is sufficient.

How do I assess the professional competence of the other auditor?

Look at the other auditor's qualifications, experience, reputation and independence. You can use past experience with the firm, inquiries and information from their professional body. If you do not know the firm, do more inquiry.

What is the difference between the responsibility of the principal auditor and the other auditor?

The other auditor is responsible for the work on the component they audit. The principal auditor gives the opinion on the whole financial statements. If the report does not refer to the other auditor, the full responsibility stays with the principal auditor. If the report refers to the other auditor's work, the reference indicates a division of responsibility under SA 600 as adopted in India, and it is not a qualification.

What if the other auditor's work is not sufficient?

The principal auditor can perform additional procedures or ask the other auditor to do so. If sufficient appropriate evidence still cannot be obtained, this is a limitation of scope. The report is then modified with a qualified opinion or a disclaimer of opinion, depending on materiality and pervasiveness.