During the audit of JKL Industries, the auditor identified certain significant deficiencies in the company's internal control system. Senior…

CA Intermediate · Auditing and Ethics · MTP · January 2026
During the audit of JKL Industries, the auditor identified certain significant deficiencies in the company's internal control system. Senior management acknowledged these issues but suggested that an oral briefing would be sufficient. The auditor, however, was required to determine the appropriate method and timing of communication. Which action is the auditor required to take?
(A) Provide only an oral communication to management since they have acknowledged the deficiencies.
(B) Communicate in writing the significant deficiencies in internal control to those charged with governance on timely basis.
(C) Delay the communication until the audit is completed to avoid disturbing the management's ongoing activities while the audit is still in progress.
(D) Communicate only if the deficiencies are expected to materially misstate the financial statements.

Suggested Answer and Working Notes:

Correct Answer: Option (B)

Communicate in writing the significant deficiencies in internal control to those charged with governance on timely basis.

Topics: Risk Assessment and Internal Control

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