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

While auditing purchases at Ganga Cements Ltd, internal auditor Neha has not yet received supporting records for a sample, but the manager urges her to finalise the report to meet a deadline. Which action reflects due professional care?

Neha should obtain sufficient appropriate evidence for the sample or, if that is not possible, disclose the scope limitation in her report. Due professional care demands conclusions supported by adequate evidence, so verbal assurance, omission or a presumed satisfactory result is unacceptable.

  1. AIssue the report stating the sample was satisfactory
  2. BIssue the report omitting that sample
  3. CComplete sufficient procedures to obtain adequate evidence or disclose the limitation in the reportCorrect
  4. DRely on the manager's verbal assurance

Explanation

Due professional care requires conclusions to rest on sufficient, reliable evidence. If evidence is unavailable, the auditor must obtain it or clearly report the scope limitation. Verbal assurance is weak evidence, and omitting or misstating the sample is misleading.

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