Relying Upon the Work of an Internal Auditor under AAS 7

Relying upon the work of an internal auditor is the auditing standard 7, it tells us the limit of external auditor’s dependence on the internal auditor. We know that internal auditor is the part of management team, so it is sure the decisions in the opinion of internal audit report will be affected by management. By considering these points, external auditor has to depend on the work of an internal auditor.

Here are some rules regarding this in this AAS 7

  • Both internal auditor and external auditor’s target is same. Both want to see correct accounting http://www.svtuition.org/2010/02/accounting.htmlinformation which is given through management’s financial statement. Both collect evidence for capturing frauds and errors in accounting data. So, as per simple rule, external auditor should keep faith on the information and opinion which is provided by an internal auditor. External auditor should not increase his tension by creating doubts on the reports which are provided by internal auditor. He should faith that internal auditor and his identity are just drops of rain whose aim is to clean the rock of company. No one can faith, how can drops clean the rock but it is the truth because these rain drops are fallen by God’s order and they do not do any jealousy with each other. Like this, external auditor should keep his behavior with internal auditor. He should love to internal auditor and in the refund, he will get love.
  • By loving deeply with internal auditor, he should not forget his duty. He is auditor; he should check every fact’s truth. External auditor should not faith in internal auditor’s report by closing his eyes.  He should check it one by one. It is true, internal auditing decreases the work of external auditor but internal auditor is also human being. So, there is the chance of mistakes in it. If external auditor does not satisfy from the reports of internal auditor, external auditor can start to work of auditing from beginning by checking each transaction and events of business.
  • External auditor should review the system of internal control. To know the system is important because if there is the weakness in it, then, there is chance of mistake in it. External auditor should check the qualification of employees of internal audit department. If external auditor will assure regarding the technical competence of these employees, then external auditor can rely on the information which are provided by internal audit department.
  • External auditor will have the option of sample test of work of internal auditor. If sample test is as per the standards of external auditor, external auditor can rely on these work and include in the part of his audit work. 
Related : AAS 6

COMMENTS

Comments on this Website
.
Share above Content to Your Friends



Name

access account accountant Accounting accounting definitions accounting ebook Accounting education accounting procedure accounting process outsourcing Accounting Software advance advertising africa Amalgamation amendments announcements Annuity assets audit auditing Australia B.Com. balance sheet bank Bank reconciliation banking basic accounting BBA benefits best bill black money blog bloggers book keeping bookkeeping Branch Accounting - full tutorial budget Budget variance business businessman CA calculator canada capital capital budgeting career cash cash book cash flow statement Chiense children china class coaching coins college commerce commerce students company computer computer accounting conference Contact vinod kumar corporate accounting cost cost accounting cost center cost centre CPA credit credit card cs currency data Debit and credit debit cards debt debtor degree depletion depreciation documents dollar domain Downloads Dubai e-accounting earning education Education Loans email employee EPF ERP euromoney examination excel excise duty expenses facebook factor of loan fans feature fifo FII fiji finacle finance Financial financial accounting fire insurance flickr flow forensic forex formula france fraud free fun function fund GAAP GDP gdr germany gold goodwill goodwill accounting google google apps google apps google base google buzz google calendar Google docs google finance google fusion tables google talk govt. GST guide health Hindi Hindi Language history holding company How to treat FBT in Tally 9 HRA ICAI ICAWI ICICI Bank IFRS income income statement Income Tax India indian railway Indonesia inflation inflation accounting infographics information inspiration insurance insurance accounting interest international Internet Introduction of Tally 9 inventory investment invoice IT Japan Job costing journal entries Kalculate keyboard kindle kuwait laptop law LBT learning lease lecture ledger leducation Leverage Analysis liabilities lifo linkedin loan logical point loss loss of profit M.Com. m.phil malaysia management accounting manual accounting manufacturing account market marketing mastercard material MBA MCA media migration mobile money ms word ms. excel multi currency in tally 9 Multicurrency Accounting mutual fund national security new and sacrifice ratio new york times new zealand news NGO nonprofit-accounting North Georgia Mountains NPV NSE odbc office oman online application online accounting otcei pakistan parents pay pal pdf pie chart pie chart of income pnb podcast ppf presentation price privacy policy prize money prof. vinod kumar profit profit and loss account project management provision purchase puzzles quickbooks Quote quotes quotes of svtuition rating agency ratio analysis RBI readers real estate rectification of errors remote control reports reserves responsibility accounting retirement revenue Revenue reserves review risk rupees salary sale saudi arabia saving sbi scholarship school SEBI security service tax share share trading Shares shri lanka singapore sms social accounting society solution South Africa stock stock exchange structure student students study subsidiary company svtuition swiss bank tally tally 9 Tally 7.2 Tally 9 Tally.ERP 9 tanzania tax Tax Accounting TDS teacher teaching technology test testimonial testimonials thailand tips trading trading on equity transaction trend trial balance tuition twitter UAE UGC - NET Commerce UK United Arab Emirates university usa valuation VAT Video Voucher and vouching wikipedia working capital youtube
false
ltr
item
Accounting Education: Relying Upon the Work of an Internal Auditor under AAS 7
Relying Upon the Work of an Internal Auditor under AAS 7
Accounting Education
http://www.svtuition.org/2013/10/relying-upon-work-of-internal-auditor.html
http://www.svtuition.org/
http://www.svtuition.org/
http://www.svtuition.org/2013/10/relying-upon-work-of-internal-auditor.html
true
2410664366776677676
UTF-8
Not found any lecture VIEW ALL Readmore Reply Cancel reply Delete By Home PAGES Lectures View All RECOMMENDED FOR YOU Category ARCHIVE SEARCH ALL Lectures Not found any lecture match with your request, please help to write it and send it to our email at vinod@svtuition.org for making this website free accounting and finance encyclopedia. Back Home Sunday Monday Tuesday Wednesday Thursday Friday Saturday Sun Mon Tue Wed Thu Fri Sat January February March April May June July August September October November December Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec just now 1 minute ago $$1$$ minutes ago 1 hour ago $$1$$ hours ago Yesterday $$1$$ days ago $$1$$ weeks ago more than 5 weeks ago Followers Follow THIS CONTENT IS PREMIUM Please share to unlock