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CS Professional · Internal and Forensic Audit · Reporting under Internal Audit

Orion Steels Ltd's internal audit report on inventory is well written, but the statutory auditor wants to judge the quality of the work behind its conclusions. Which procedure is listed in SA 610 (Revised) as a way to do so, in addition to reperformance?

SA 610 (Revised) lists reviewing the internal audit function's work program and working papers, along with inquiries of its people and observing its procedures, as ways to evaluate quality in addition to reperformance. A signature, committee praise or management confirmation does not test the underlying work.

  1. AAccepting the report because it is signed by the head of internal audit
  2. BReviewing the internal audit function's work program and working papersCorrect
  3. CRelying only on the audit committee's praise of the report
  4. DAsking management to confirm the report is accurate

Explanation

The listed procedures include making inquiries of appropriate individuals within the function, observing procedures performed, and reviewing the work program and working papers. A signature, committee praise or management confirmation does not evaluate the underlying work.

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