An internal audit function has agreed to conduct an advisory consulting engagement related to evaluating the efficiency of a process. During this engagement, an internal auditor identifies a control weakness that could be material to the company. Required: 2.1 Since a consulting engagement is between two parties - the customer and the auditor - is there any obligation to disclose this weakness to senior management and the audit committee? 2.2 What are the benefits and drawbacks of an internal auditor communicating such a weakness?
An internal audit function has agreed to conduct an advisory consulting engagement related to evaluating the efficiency of a process. During this engagement, an internal auditor identifies a control weakness that could be material to the company. Required: 2.1 Since a consulting engagement is between two parties - the customer and the auditor - is there any obligation to disclose this weakness to senior management and the audit committee? 2.2 What are the benefits and drawbacks of an internal auditor communicating such a weakness?
Auditing: A Risk Based-Approach (MindTap Course List)
11th Edition
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Chapter14: Completing A Quality Audit
Section: Chapter Questions
Problem 39CYBK
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An internal audit function has agreed to conduct an advisory consulting engagement related to evaluating the efficiency of a process. During this engagement, an internal auditor identifies a control weakness that could be material to the company. Required:
2.1 Since a consulting engagement is between two parties - the customer and the auditor - is there any obligation to disclose this weakness to senior management and the audit committee?
2.2 What are the benefits and drawbacks of an internal auditor communicating such a weakness?
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