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CA Final · Advanced Auditing, Assurance and Professional Ethics · Digital Auditing & Assurance

During the audit of Brahmaputra Finserv Ltd., a listed company, the engagement partner proposes to use an AI-based tool, built by the firm's technology team, to summarise board minutes and flag unusual contracts. The tool output will be used as audit evidence on related party identification. Which approach is most consistent with SA 500, SA 220 and the Code of Ethics?

The tool may be used only after the auditor evaluates its reliability and the completeness and accuracy of its inputs, with the partner reviewing results and retaining professional judgement. Client confidentiality must be preserved, so minutes should not go to public platforms, and the work must still be documented.

  1. AUse the output directly, since AI tools are free from human bias
  2. BUse the output only after assessing the tool's reliability and completeness of its input, with partner review of results and no delegation of professional judgement to the tool; client confidential data must be protectedCorrect
  3. CUse the output and omit documentation because the tool keeps a log
  4. DShare the client's minutes with a public AI platform to improve accuracy

Explanation

Information produced with a tool must be assessed for relevance and reliability (SA 500), and the engagement partner remains responsible for direction, supervision and review (SA 220). Professional judgement cannot be delegated, and confidentiality under the Code of Ethics prohibits uploading client data to public platforms without safeguards. The other options skip validation, documentation or confidentiality.

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