CAF-8 · Chapter 12 · Question 6 of 10
If an auditor uses a 'Service Organization' (e.g., an external company that processes the client's payroll), which ISA applies?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) ISA 402
Explanation
ISA 402 (Audit Considerations Relating to an Entity Using a Service Organization) guides the auditor on how to obtain evidence when a client outsources key business processes.
More Reliance on Others MCQs
- Q8Which of the following is an indicator of LOW 'Objectivity' for a client's internal audit department?
- Q9When the external auditor decides to use the work of an expert, which of the following must be agreed upon in writing between the auditor…
- Q10In Pakistan, if the external auditor mentions the name of an auditor's expert in an 'Unmodified' audit report, what is the prerequisite?
- Q1Under ISA 610, when can the external auditor use the work of the 'Internal Audit Function'?
- Q2Which of the following tasks is considered too high-risk for the external auditor to delegate to internal auditors as 'Direct Assistance'?