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Group audit - Coggle Diagram
Group audit
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Joint audit
- grp auditor jointly with component auditor to provide joint opinion
Adv
- increase competition btwn auditors, improve performance
- increase manpower of audit staffs
- provide different expertise
- quality improve
Disadv
- more expensive
- different audit approaches & terminology
- time consuming
- problems for 2 audit firms work together
Planning & organisation
- meeting discuss the matters:
- commencement date & timeline
- task allocation & communication of expectations
- agreement on audit programme & methodology to be used
- scheduled closing meeting to discuss
- audit issues identified
- issuance of mgt letter
- conclusion of audit opinion
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Modified report
Effect on grp's audit report
- if immaterial to grp, :red_cross:effect on grp's audit report
- if material to grp, wld result corresponding qualification of grp's audit report
- if there is disclaimer note, grp's audit report will have 'accept for' opinion (effect had been diluted in grp lvl)
Outcome
- grp auditor satisfied with work performed by component auditor
- :red_cross:reference to component auditor, may misinterpreted qualification of their opinion
- grp auditor has sole responsibility for audit opinion
- grp auditor failed to obtain SAAE tht deemed material & alternative procedures are not available
- component auditor's report contains qualification / explanatory paragraph relating to uncertainty (cld relate to GC status of the component)
- Grp auditor
- auditor express opinion on consol FS
- Component auditor
- auditors of subsi, associate / JV where the FS are consol
- Component
- subsi, associate, JV / other special purpose vehicle