M/s Sam Karan & Associates has been appointed as an auditor of Heaven Ltd. for the financial year 2024-25. CA Sam, one of the partners of M/s…

As per SA 220 “Quality Control for an Audit of Financial Statements", an engagement partner taking over an audit during the engagement may apply the review procedures such as the work has been performed in accordance with professional standards and regulatory and legal requirements; significant matters have been raised for further consideration; appropriate consultations have taken place and the resulting conclusions have been documented and implemented; there is a need to revise the nature, timing and extent of work performed; the work performed supports the conclusions reached and is appropriately documented; the evidence obtained is sufficient and appropriate to support the auditor's report; and the objectives of the engagement procedures have been achieved. Further, as per the Code of Ethics it is the auditor's professional responsibilities and should be complied with that when the auditor delegates work to assistants or uses work performed by other auditors and experts, he will continue to be responsible for forming and expressing his opinion on the financial information. However, he will be entitled to rely on work performed by others, provided he exercises adequate skill and care and is not aware of any reason to believe that he should not have so relied. However, the auditor should carefully direct, supervise and review the work delegated. He should obtain reasonable assurance that work performed by other auditors/experts and assistants is adequate for his purpose. In the given case, all the auditing procedures before the moment of signing of final report have been performed by CA Sam. However, the report could not be signed by him due to his unfortunate death. Later on, CA Karan signed the report relying on the work performed by CA Sam. Here, CA Karan is allowed to sign the audit report, though, will be responsible for expressing the opinion. He may rely on the work performed by CA Sam provided he further exercises adequate skill and due care and review the work performed by him.