CS Professional · Internal and Forensic Audit · Reporting under Internal Audit
The head of internal audit at Sagar Pharma Ltd. wants the Audit Committee to see how well the internal audit function communicates risk and control information. Per SA 610 (Revised), which governance-related activity may the internal audit function perform?
The internal audit function may assess the governance process, including how effectively risk and control information is communicated among those charged with governance, external and internal auditors, and management. Approving financial statements, setting external audit materiality or appointing auditors are not internal audit activities.
- AAssess the effectiveness of communication among those charged with governance, external and internal auditors, and managementCorrect
- BApprove the entity's financial statements on behalf of the board
- CDetermine the statutory auditor's materiality level
- DAppoint the external auditor for the entity
Explanation
SA 610 (Revised) notes that the internal audit function may assess the governance process, including communicating risk and control information to appropriate areas and the effectiveness of communication among those charged with governance, external and internal auditors, and management. The other options are board, audit committee or statutory auditor responsibilities, not internal audit activities.
Did you get it right without looking?
One question tells you little. A timed set on Reporting under Internal Audit shows your real accuracy, how long you take and where you lose marks.
More Reporting under Internal Audit questions
- During coordination, Meera, an internal auditor at Bharat Logistics Ltd, tells the external auditor that she suspects a purchase manager has…
- Before relying on the internal audit function of Narmada Cements Ltd., the statutory auditor evaluates whether its work can be used. Which s…
- Hindustan Steel Components Ltd's internal audit function reports to the Managing Director, who is a member of management. The external audit…
- Before using internal auditors of Ganga Steels Ltd. to give direct assistance in the statutory audit, the external auditor obtains a written…
- Which activity of an internal audit function, as described in SA 610 (Revised), would a report most directly address when it comments on whe…
- During a quarterly review, the internal auditor of Kaveri Textiles Ltd. finds that two earlier recommendations on vendor payment controls re…