English|NetherlandsStandardsonAuditing|600699UsingWorkofOthers|600UsingtheWorkofAnother

Auditor
terug

UsingWorkofOthers
600 UsingtheWorkofAnotherAuditor

APPENDIX

Minimumprogramtobeconsideredbytheprincipalauditorusingtheworkofanother
auditor1)

Setoutbelowaretheprocedurestobecarriedoutbytheprincipalauditorifheintends
tousetheworkofanotherauditor.Theserepresenttheminimumrequirementsineach
case.However,dependingonthecircumstances,theprincipalauditorwouldconsider
whethersupplementaryproceduresarenecessary.Whentheotherauditorbelongstothe
same(international)firmastheprincipalauditorandwhenthefirmhasacceptable
qualitycontrolpoliciesandproceduresandmonitorstheircompliance,thereviewofthe
workoftheotherauditorcanbelimitedtotheauditingstandardsappliedandtheaudit
findings.

Duecareinselectingtheotherauditor

1. Theclientshouldexerciseduecareinselectingtheotherauditor.Aspartofhisauditofthe
entity'sfinancialstatementsasawhole,theprincipalauditorwouldconsiderwhethersuchdue
carehasbeentaken,particularlybyreferencetotheworkperformedbytheotherauditor.The
principalauditormayormaynothavebeeninvolvedintheselection.Ifhewas,hewould,as
regardshisroleintheselectionoftheotherauditororauditfirm,havebeenablepriortothe
selectiontosetthecriteriaheconsideredappropriate.Ifhewasnot,hewouldmerelybeable
toreviewtheselectionafterwards.Theprincipalauditorwillreviewtheselectionoftheother
auditorbyreferencetothefollowingcriteria:

Independence

2. Independencewouldbereviewedonthebasisofthesamecriteriaasthosethatarelaiddown
elsewhereintheStandardsonAuditingandbyrequestingtheotherauditortoconfirmhis
independence.Themostimportantaspectsforestablishingauditorindependenceoftheother
auditorareasfollows:

a. professionalindependence

b. financialindependence

c. avoidanceofrelationshipsbybloodorbymarriagewiththeclientand

d. independenceofmind.

Professionalcompetence

3. TheprofessionalcompetenceofauditorsintheNetherlandsisreviewedonthebasisofthe
requirementsincludedintheRulesofProfessionalConductandPracticeofAccountants.Thatof
overseasauditorsisreviewedonthebasisofthefollowingcriteria,whichtogetherwould
enableanopiniontobeformedontheirlevelofprofessionalcompetence:

a. Membershipofarecognizedprofessionalbody.Informationmaybeobtainedby
inquiriesfromtheRoyalNIVRA,theNOvAAand/orfromtheprofessionalbodyin
thecountryconcerned.Thequalityofeducation,trainingandprofessionalcodeof
conductareimportantinthiscontext.

b. Professionalrulesanddisciplinaryrulings.Thiscriterioncanbetestedonlyifthe
otherauditorisamemberofaprofessionalbodywhichissuesitsowndisciplinary
 rulings.Lawsandregulationsmayalsostipulatetheprofessionalbehaviorofthe
otherauditor.

c. Individualprofessionalskillsandexperience.Itwillbenecessarytoconsider
whethertheotherauditorhasreceivedadequatetraining.Otherconsiderationsin
thiscontextincludethequestionofwhethertheotherauditorisapartnerin,oris
liaisedwithareputablefirmwithappropiatetechnicalexperience.
Further,itisimportantthattheotherauditorisexperiencedandknowledgeablein
relationtolocalconditionsandregulationswhicharerelevanttotheengagement.

Properworkingrelationshipsbetweenprincipalauditorandotherauditor

4. Toachievethis,thefollowingquestions,amongothers,wouldbeconsidered:

Hastheotherauditorbeeninformedinrelationtotheusethatwillbemadeofhis
work?

Havearrangementsbeenmadetocreateconditionswhichwillensureanopen
dialoguebetweentheprincipalauditorandtheotherauditor?

Haveappropriatestepsbeentakentoensurethattheotherauditorwillbe
providingallmaterialinformationtotheprincipalauditortoenablethelatterto
formanopinion?

Willanymaterialmatterswhichmightcausetheprincipalauditortoqualifyhis
auditreport,bebroughttotheattentionoftheprincipalauditorpromptly?

Doestheprincipalauditorknowtheretentionperiodsapplicabletoworkingpapers
offoreignauditors,responsiblefortheauditofforeigngroupcompanies(inview
oftheconsequencesofshorterretentionperiodsinforeigncountries)

Requirementsastoformandcontentofthefinancialinformationofacomponent

5. Anauditorreportingonthefinancialstatementsofanentitywhoplanstousetheworkof
anotherauditorreportingonthefinancialinformationofacomponentwouldrequiretheirform
andcontenttocomplywithcertainstandards.Thefollowingquestionswouldbeofimportance
inthisrespect:

Hasthefinancialinformationofthecomponentbeenpreparedforconsolidation
purposes?

Istheotherauditorfamiliarwiththeaccountingpoliciesfortheconsolidated
accounts?

Doesthereportoftheotherauditorincludecompliancewiththesepolicies?

Reviewoftheworkoftheotherauditor

Reviewofauditingstandards

6. Forthefirstyearinwhichtheengagementiscarriedout,theauditingstandardsappliedbythe
otherauditorwouldbesubjecttotcomprehensivereviewbytheprincipalauditor.The
followingpointsareimportantinthiscontext:

Doestheengagementletterimposerestrictionsuponthescopeofworkofthe
otherauditor?

Arethereasonsunderlyingtheauditapproachadoptedbytheotherauditor
adequatelyexplained,forexampleintheauditplan?

Iftheauditplanshowsdeficienciesorshortcomings,havetheybeenremedied?

Insubsequentyears,theprincipalauditorwouldaskwhethertheotherauditorhase
madeanysignificantchangestohisauditapproachfromthatofthefirstyear.
Reviewofauditfindings

7. Theotherauditor'sfindingsarereviewedby:

Areviewofthefinancialinformation.

Studyingthereportsonauditfindings,ifany.

Reviewofauditprocedures

8. Forthispurpose,theprincipalauditorwouldexaminewhethertheotherauditorhassufficient
resourcestocarryouttheaudit,andwhethertheaudithasbeenproperlyplanned.The
principalauditorwouldalsoreviewanyauditquestionnairescompletedbytheotherauditor.

9. Further,theprincipalauditorwouldhaveregardtothefollowingmatters:

Hastheinternalcontrolstructurebeenexaminedtoestablishitseffectivenessand
howitoperates?

Doestheotherauditorascertain:

whetherrevenueandexpensesarecorrectandcomplete?

theexistenceandcompletenessofassetsandliabilities?

Isattentionpaidduringtheauditto:

reportinginconformitywithgroupaccountingpolicies?

theappropriatenessofthegroupaccountingpolicies?

thecorrectapplicationofthesepolicies?

disclosureinthefinancialinformation?

thenecessityforadditionalinformationonliquidity,solvencyand
returnoninvestment?

contingentliabilities(contracts,pendingclaims,etc.)?

postbalancesheetevents?

Doestheotherauditormakeuseoftheworkofinternalauditorsorofother
auditors?Ifso,onwhatbasisdoestheformerdecideonthelevelofrelianceto
placeontheirwork?

Doestheotherauditormakeuseofotherspecialists,forexample,toexaminethe
taxposition(currentanddeferred)oristheotherauditorcompetentinthose
areas?

Doesthereportoftheotherauditorcontainaclearopiniononthecomponentto
theeffectthatthefinancialinformationpresentsatrueandfairview(present
fairly)thefinancialpositionandtheresults?

Ifaqualifiedopinionwasgiven,whatwerethereasons?

Ifanunqualifiedopinionwasgiven,arethereanymatterswhicharoseduringthe
otherauditor'sauditwhichshouldbebroughttotheattentionoftheprincipal
auditor?

Suchproblemscouldrelateto:

theorganisationandtheinternalcontrolstructure
 theconductoftheaudit

thecomponent'sfinancialinformation.

Arethereanymattersintheotherauditor'sreportwhichcommentuponthe
organisation'smanagement?

10. Dependingupontheoutcomeofthisreview,theprincipalauditorwoulddeterminewhetherhe
wouldcarryoutareviewoftheotherauditor'sworkingpapers.Basedontheconclusionsof
thisreview,theprincipalauditorwoulddecidewhetheradditionalauditprocedures,tobe
carriedoutbytheotherauditororbyhimself,arenecessary.

1)Seedefinitioninparagraph4ofthisStandard