CA Puneet, engagement partner for the audit of a listed company, decided to use the work of the company's internal audit function for testing…

As per SA 610, "Using the Work of Internal Auditors", before using the work of the internal audit function, the external auditor is required to evaluate: The extent to which the internal audit function's organisational status and relevant policies and procedures support the objectivity of the internal auditors. The level of competence of the internal audit function. Whether the internal audit function applies a systematic and disciplined approach, including quality control. Where the external auditor plans to use internal auditors to provide direct assistance, additional requirements apply, including obtaining written agreement from an authorised representative of the entity and from the internal auditors, evaluating the existence and significance of threats to objectivity, and the level of competence of the internal auditors providing direct assistance, and discussing with them the planned use of their work. In the given case, CA Puneet has used the work of the internal audit function without evaluating the objectivity and competence of the internal auditors, and without discussing the planned use of their work with them. This is not in accordance with SA 610. CA Puneet should carry out the required evaluation before using their work, and the external auditor must, in any event, remain responsible for the audit opinion expressed and exercise judgement in determining the nature and extent of use of the internal auditors' work.