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CS Professional · Internal and Forensic Audit · Practices related to Internal Auditing

An internal auditor of Kaveri Pharma Ltd has completed fieldwork on the inventory function. Before issuing the final report, the auditor shares the draft observations with the warehouse head and obtains management responses. What is the main purpose of this step?

Sharing the draft with the auditee is done to verify factual accuracy and obtain management's responses and action plans, making the final report balanced and workable. The auditor keeps responsibility for the findings and independence, and follow-up is still required to confirm implementation.

  1. ATo confirm factual accuracy and obtain management's action plan so the report is balanced and practicableCorrect
  2. BTo transfer responsibility for the audit opinion to the warehouse head
  3. CTo allow management to remove findings it considers unfavourable
  4. DTo replace the need for any follow-up review

Explanation

Discussing the draft with the auditee checks that facts are correct and secures agreed actions with timelines, making the report fair and actionable. The auditor retains independence and responsibility for the findings, so management cannot delete them. Obtaining responses does not remove the need for follow-up.

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