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ACCA Strategic Professional · Advanced Audit and Assurance (International) · Using the work of others

Harlow & Co proposes to use internal auditors of Tavish Logistics to provide direct assistance on the external audit, performing procedures under the engagement team's direction. Which of the following is prohibited under ISA 610?

Using internal auditors to make significant audit judgements, such as assessing risks of material misstatement or evaluating whether evidence is sufficient, is prohibited. Direct assistance on limited tasks is allowed if objectivity and competence are evaluated and the external auditor directs, supervises and reviews the work.

  1. AUsing direct assistance after the auditor has evaluated threats to the internal auditors' objectivity and their level of competence
  2. BUsing internal auditors to assist with tasks such as observing inventory counts under supervision
  3. CUsing internal auditors to make judgements about assessing the risks of material misstatement or evaluating the sufficiency of evidenceCorrect
  4. DDirecting and supervising internal auditors and reviewing their work

Explanation

ISA 610 prohibits using internal auditors for procedures involving making significant judgements in the audit, such as assessing risks of material misstatement or evaluating the sufficiency of evidence obtained. Direct assistance on limited tasks is allowed where objectivity and competence are evaluated and the auditor directs, supervises and reviews the work, if law does not prohibit it.

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